Is Pet Insurance Worth It?

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By Becky Turner

Is pet insurance worth it? Do the numbers add up? What are the risks? What pet insurance discounts are there? Should I take out pet insurance for my dog?

Is pet insurance worth it? This is a question I've been mulling over ever since I added up all the vet bills during the first year of having our Sheltie puppies Howard and Piper. For instance, so far we've paid the vet: $130 on vaccinations, $180 on appointment fees, and $400 on neutering. This adds up to $710 for two Shelties to have their basic vaccinations, annual check-ups, desexing, plus a visit for Howard when he had a bacterial infection from a scratch.

With an average monthly pet insurance premium of $15 (adding up to $180 per year) it appears at face value that pet insurance is worth it. But let's dig a littler deeper...

Is pet insurance worth it?

For a start, the most expensive vet bill was neutering two dogs and that is a one-time thing. In this article I have looked realistically at the vet visits over a lifetime, what treatments are actually covered, and the fine print which stipulates important issues like payment caps and co-pay limitations.

What is Pet Insurance - Really?

Realistically, pet insurance is a form of enforced savings - that almost never covers the entire vet bill. Consumer Reports points out that you can achieve the same thing by paying the same monthly premium into your own savings account.

The upshot is that if your Sheltie never gets seriously injured or diseased, the savings will belong to you. This can range from $2,000 to $9,000 over your dog's lifetime (where monthly insurance premiums range from $11 to $50). Thankfully, the odds are stacked in your favor too. Many well-bred dogs live long, healthy lives without complications, so the biggest vet bill you will ever shell out for is desexing.

Of course, the downside is that if your Sheltie ever does need expensive medical treatment, you will need to spend those savings. So the question - is pet insurance worth it - really comes down to the chances of your dog developing serious ailments, paired with the cost of premiums and how much the insurance will cover.

Lucky The Labrador Retriever

To assess this, let's look at the example set out on the Consumer Reports website. They created Lucky, a fictional purebred Labrador Retriever, and gave him a list of common ailments over his lifetime. Then they calculated some pet insurance comparisons and the overall cost of treating Lucky with and without insurance.

Common Ailments

Lucky has 9 claims over 11 years: a broken leg, an ear infection, a cut needing stitches, an eye infection, hypothyroidism needing years of drug claims and a torn knee ligament.

Without pet insurance, this would cost $3,301. With pet insurance, it would cost from $3,798 to $6,681 depending on your insurance provider.

Whichever insurance provider they went with, Lucky's owners would have lost money even with his numerous minor ailments.

Major Problems

But what if Lucky is not so lucky after all? Imagine if he has ALL the common ailments from the list above, PLUS needs hip replacement surgery.

Without pet insurance, the total cost would be $10,414. With pet insurance, it would cost from $7,794 to $12,016 depending on your insurance provider.

What does Lucky teach us? If your dog requires an expensive treatment, pet insurance may be worth it. The Pet Care QuickCare Gold Double Benefits policy would save you as much as $2,620.

Then again, you may still end up paying more despite taking out pet insurance because of the restrictions in the fine print. The Veterinary Pet Insurance Superior policy would actually cost you $1,602 more than if you had no insurance at all!

Bear in mind that a lot of people pay expensive pet insurance premiums for years and never need to make a large claim. This is where it's good to look at pet insurance as "enforced savings". The only difference? If your dog never gets seriously ill, your savings actually remain in your own bank account.

Read The Fine Print

If you have a dog who is prone to ailments, or you do decide to buy pet insurance in order to help protect yourself from large vet bills, make sure you read the fine print. Pay special attention to the following factors:

• Lifelong Pet Insurance - like humans, dogs face more health complications as they get older. To protect their profits, most pet insurers won't cover pets over 9 years old (and if they do, the premiums are very high). So try to lock in the cheaper 'young dog' premium - or your provider will just hike it up as your Sheltie gets older.


Reading the fine print could save you lots

• Deductibles - All pet insurance plans have deductibles (also called an excess) which is a minimum amount you have to pay the vet before the insurance company will pay out anything. Choosing a sliding deductible from zero to $1,000 means you can cut the cost of vet bills right down - but this will jack your premiums up.
• Co-pay - As well as deductibles, your insurance company may insist that you pay 10-20% of the vet bill. For most, co-pay prevents pet insurance being worthwhile.
• Payment Caps - A cap is the maximum amount your pet insurance provider will pay out - per condition, per year, and per lifetime. Again, this covers their profits, so even if your Sheltie has one or more serious conditions, they will only pay so much to help. Even the most expensive insurance providers can impose payment caps.
• Claim Delay - Be aware that even if you have comprehensive pet insurance, you will still have to pay the vet yourself at the time of treatment. You then fill out an insurance claim and mail it to your provider, who calculates your entitlement and reimburses part of the bill usually within 2 to 4 weeks.
• Fine Print - Always read the fine print of a pet insurance policy. There will be a host of rules set out regarding what treatments are covered, when the policy goes into effect, whether prescriptions are covered, and whether emergency treatment is covered. To ensure you get the best pet insurance for a Sheltie, make sure you compare policies and choose wisely depending on your circumstances.

Becky Turner is a writer and zoologist-in-training. Learn more about Becky here. If you'd like to support her work, check out her ebook, The Sheltie Anthology, a complete guide to everything Sheltie.

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