Do You Need Pet Insurance? Here’s How to Decide

Most people who love their pets go the extra mile to make sure they receive the highest quality of care possible. This includes taking the time to get them to the veterinarian’s office for wellness checkups and shots, making sure they have nutritious food and fresh water, and providing them with a cozy place to sleep. None of these basics are cheap, but most animal-lovers believe their furry friend is well worth the cost.

Unfortunately, the price tag for keeping a pet can surge dramatically if your pet becomes ill or is diagnosed with a chronic condition. And, many times, these costs can creep up with little or no warning, meaning you have no time to prepare your finances for the expense. The American Veterinary Medical Foundation also notes that, as veterinary medicine becomes more technologically advanced, costs can and will increase even more.

One way animal-lovers can defray these costs is by purchasing a pet insurance policy similar to health insurance you buy for humans. With pet insurance, you typically pay a monthly premium for a certain level of coverage along with a deductible if you need to file a claim. While pet insurance isn’t cheap, it can often save you from covering exorbitant medical bills when your pet suddenly becomes ill or injured.

And, like it or not, none of us knows if our pet will one day get hit by a car, get sick with cancer, or swallow a sock.

Related: Pet Ownership Costs Guide for 2018

Do You Need Pet Insurance?

While it seems at least some people don’t believe pet insurance could possibly provide a good value, we wanted to ask people who have actually purchased pet insurance and filed claims. Sylvia Inks of Raleigh, N.C., is one such consumer, having filed $3,300 in claims through her ASPCA pet insurance policy for her dog since 2011.

Inks says her ASPCA Level 2 coverage covers accidents and illnesses with a $100 annual deductible, $3,000 limit per incident, and 20% co-insurance requirement. However, her policy does not cover congenital and hereditary care, continuing care, or wellness care.

When Inks originally bought her policy in 2008, she says she had heard and read about people who were unhappy with their plans. As a result, she asked her veterinarian which insurance companies they work with and have faith in. That’s how she ended up buying a policy through the ASPCA.

While Inks only has $3,000 in coverage per incident, which is fairly limiting, she says this coverage has been perfect for her needs and a “great experience.” Almost every time she has filed a claim, she’s been reimbursed in around 30 days. Plus, the process is infinitely easier and faster now than when she first bought her policy in 2008. Where you used to have to mail the claim form and vet receipt to the ASPCA, you can now file the entire claim online.

“I just need to provide information including where my pet received treatment, when my pet was treated, how much I am claiming, what type of claim, describe why I took my pet to the veterinarian, and upload the invoice file and medical records,” she says.

Unfortunately, not every consumer has a positive experience with their pet insurance like Inks — and even with the same insurer. Some people who use ASPCA pet insurance and other providers complain online that service is poor or that claims were paid extremely slowly. Across pretty much every pet insurance provider, there are consumers who rage on about “fine print” they didn’t read in their policies, and about how their coverage didn’t kick in to help with their pet’s medical bills.

For that reason and others, it pays to be diligent about the details when you shop for a pet insurance policy.

How to Shop for Pet Insurance

According to Sa El, co-founder of Simply Insurance, an online company that provides pet insurance as well as other insurance products, there are a wide range of details to explore as you compare pet insurance policies to find the right option for your needs. Cost should play a role in the policy you buy, but you also need to conduct due diligence so you know what your policy actually covers. Here are the factors to consider as you shop around:

Pre-existing conditions: El says the most important detail to note is whether your pet has any pre-existing conditions. If your pet is older and has had multiple surgeries or has a chronic medical condition, then pet insurance is probably not going to help you, since pet insurance companies do not cover pre-existing medical conditions.
Age: If your pet is older and in good health, however, you can buy pet insurance — just at a higher cost, since your premiums will be adjusted to make up for increased risk associated with your pet’s age.
Coverage limits: “Some companies have unlimited benefits while others limit you to $5,000 or $10,000 a year in covered benefits,” says El. While you will likely pay more for a policy with an unlimited benefit, these beefier policies can be a life-saver if your pet winds up needing especially expensive veterinarian care.
Coverage exclusions: While pet insurance companies don’t cover pre-existing conditions, most also have a list of excluded conditions they don’t cover under any circumstances. Some may cover wellness care while others do not, and it’s up to you to know what your policy includes and excludes. According to the AMVA, the insurance provider should “clearly spell out to you the details, including the limitations and exclusions, of coverage for routine and/or wellness care as well as emergency treatments and conditions that require extensive care.”
Reimbursement level: While some pet insurance policies reimburse you for 100% of your pet’s medical bills after your deductible up to your policy’s limit, others offer an 80/20 or 70/30 reimbursement structure. Make sure you know this ahead of time so you know how much you’re liable for.
Claims process: El says you want to be sure you find a company that will either pay the vet bill directly or one that has a very fast claims process for sending out your reimbursement when you have to file a claim. If you don’t, you could be stuck in a situation where you pay your vet bills upfront and wait for what seems like forever to be reimbursed.
Monthly premiums: Once you’ve compared the above criteria, you’ll also want to make sure to compare monthly premiums to find the best deal. With this in mind, it makes sense to compare policies and the cost of coverage with at least three or four different providers.

The Bottom Line

If you believe your pet could need expensive medical care one day and worry you won’t have the funds to cover the bills, pet insurance could provide you with some peace of mind. Before you purchase a policy, however, make sure you understand what is and isn’t covered, any policy limits you have, reimbursement levels, and any other fees you’ll need to pay if you use your plan. That way, you can save up some money to cover these costs if the worst-case scenario were to happen.

And if you’re unable to get coverage for your pet due to pre-existing conditions or you can’t find a policy you like, you can also self-insure against potential problems with a special savings account for your pet. Like any other savings goal, you will open a high-interest savings account, set up automatic direct deposits for every month or every payday, and start saving. Then you can pull money from that account to pay any big, unexpected veterinarian bills — but hopefully, you’ll never need it.

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