Who Let the Dogs Out?

March 15, 2021 By Kristan Anderson, CEBS®, CFP® | Dir. Of Retirement Plan Services & Dir. Of Financial Planning

As an independent young adult, soon after I brought home my first puppy, I found myself in the vet’s office. He had apparently ingested a piece of metal, making him throw up repeatedly. After a round of expensive x-rays and a diagnosis of “it will eventually work its way out,” the vet tech told me about pet insurance. It was too late for this incident, but pet insurance might have covered some of these diagnostic costs. The tech explained that this coverage is often more beneficial for puppies, due to their otherwise good relative health. After reading the policy limitations, I decided not to purchase the insurance for the puppy. But this doesn’t mean I haven’t thought about whether there was some benefit to having coverage for what can be fairly significant pet care costs, especially now that I have three dogs of various ages and healthcare needs.

In general, it appears that pet insurance is relatively cheap. Coverage costs normally range from $10 to $100 a month, with an average somewhere in the middle. Coverage for dogs is (understandably) higher than coverage for cats. ValuePenguin and LendingTree did a comprehensive review of both pet insurance coverage and average treatment costs for common conditions. Their findings suggest that average annual premiums can be more expensive than the average treatment cost for dogs, but may be worth it for most cat conditions.

Some other things to consider: 

  • Are you looking for payment for maintenance visits, or just catastrophic coverage? Some plans might cover once a year vet visits, while others may just pay for serious illness or injury. 
  • Most plans do not cover routine care. So, consider your reasons for purchasing pet insurance and know that you will have to pay the cost of care up-front, as most plans are reimbursement, only.
  • Does your pet have a pre-existing condition or injuries as a result of sport or work? If so, then you may not qualify for coverage, or the cost might be prohibitive. 
  • And if your pet, like my new puppy Loki, has emotional/behavioral issues, there are not a lot of good coverage options.

So, if you have a healthy pet and want to purchase coverage for unanticipated illness or injury, you may find an average policy to be of value. However, you could also budget for a certain level of pet care costs and save for potential catastrophic events as your pet ages. The more predictable and smaller the loss, the greater the benefit of “self-insuring.”

Meet Kristan Anderson, CEBS®, CFP® | Dir. Of Retirement Plan Services & Dir. Of Financial Planning »

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