Pet Health Insurance

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zoe-picPeople buy insurance of any kind to help them pay for large, unexpected or unplanned expenses for which they would normally have trouble paying for out-of-pocket.

Pet health insurance is a tool to help pet owners avoid a financial crisis due to unexpected veterinary expenses from accidents and illnesses. Our pets have become a part of our family, and just like the rest of our family, we want to do everything we can to keep them healthy and happy. Pet health insurance makes that possible! It pays, partially or in total, for veterinary treatment of the insured ill or injured pet. Some policies will even pay out when the pet dies, or if it is lost or stolen.

The state of veterinary science has changed in recent years, as well as the economics of running a veterinary practice. Vets today can offer treatments that were unheard of just a few years ago – and at prices that could make you howl like a beagle!

For example, treatments once reserved for humans, like radiation therapy or kidney transplants, are now available for pets. This means that once-fatal conditions are now treatable at costs ranging from $1,000 to more than $5,000.

In fact, today’s vets have access to increasingly sophisticated and costly diagnostic tools, such as MRIs, which have helped create health care inflation in the pet doctor world. New treatments have been developed to treat diseases that previously resulted in euthanasia – but these treatments can be expensive. Such expensive tools and advanced procedures not only boost the cost of exams, but on the plus side, often detect problems that once would have gone unnoticed and untreated.

But with the advances in veterinary medicine and the higher cost of treatments, pet health insurance allows dog owners to give their pets the best care available while still being able to control costs. Pet health insurance allows pet parents to not feel guilty because they are not able to afford their pet’s healthcare. With pet health insurance, they can seek the care their pet needs because they know they will be reimbursed for the cost of the procedures and treatments.

In 1982, the first pet insurance policy was sold in the United States, and issued to television’s “Lassie” by Veterinary Pet Insurance (VPI).

Even so, pet owners with insurance remain a small minority. The American Veterinary Medical Association estimates that in 2007 alone, 72 million dogs were kept as pets in the U.S. Yet, there were only 850,000 pet health insurance policies in effect that year, according to the National Commission on Veterinary Economic Issues.

VPI, the oldest pet insurer, has seen its revenue climb at an average annual rate of 26.8% since 1998. The company, which has about 71% of the U.S. pet health insurance market, had gross sales of $149 million in 2007 and $253 in gross written premiums in 2013. And it’s expected that total pet health insurance premiums in the U.S. will surpass $1 billion dollars a year by the end of the decade.

Is pet health insurance worth the cost?

This is a very important question, and one which pet owners are starting to ask and explore more frequently. And from the standpoint of both financial health for the owner and overall health for their dog, this increased interest in pet health insurance is a very good thing!

But you must first be aware that not all pet protection plans are created equal. Some operate more like discount health plans than true insurance, and you need to know the difference between wellness plans and pet health insurance before you begin shopping.

Wellness Plans

These plans are not the same as insurance, but they work more as a form of prepaid vet care. You pay a monthly fee that could be as much as $20 to $40, and in return the plan covers routine care for the year. Some plans are bare-bones while others throw in extras, such as nutrition counseling and dental cleanings. Wellness plans are often offered by specific pet providers, and if you use all of the offered services you might come out ahead. But, if you only take your pets in for an annual checkup, you might not get your money’s worth.

Pet Health Insurance

True pet health insurance is provided by a third party and can be used either at any vet or one within a participating network of providers. Just like human health insurance plans, there may be a deductible, co-payments and exclusions. Premiums typically vary depending on your pet’s species, breed and age, and whether you purchase comprehensive or catastrophic coverage. A 2012 analysis conducted by found that the average monthly premium for full coverage for a dog was $29.42.

Consider that at an average of $30 a month for full dog coverage, you will spend $3,600 in premiums over a 10-year period. If your dog has some torn cartilage or gets cancer, you may come out ahead. Otherwise, the pet health insurance company gets the financial win on your policy. However, we all have a lot of emotion tied up in our pets and if having pet health insurance gives you peace of mind, it can be money very well spent.

But pet health insurance is far from a cure-all, though:

  • The policies typically have deductibles, co-pays and caps that limit how much will be paid out annually.
  • Pre-existing problems and hereditary conditions, such as hip dysplasia in retrievers and German shepherds, are normally excluded.
  • Usually, the older your dog, the more you’ll have to shell out in premiums. Some insurers don’t cover pets older than 9, while others levy stiff surcharges.

But every owner who has walked out of the vet office with sticker shock knows medical treatment for pets isn’t cheap.

According to PetFinder, annual medical care for pets can range from $150 for small dogs to $200 for large dogs. Spaying or neutering your pet can tack on an extra $100 to $150 or more. But, preventive care is only the “tip of the iceberg.” If your dog has a medical emergency or develops a critical illness such as cancer, your bill could quickly run into the thousands.

So, if your pet were seriously sick or injured and required major surgery and/or an extended hospital stay, would you be willing to spend $5,000, or $10,000, if required – and could you afford to pay for it? If not, then you should at least look into purchasing pet health insurance.

It is expected that more and more pet owners will purchase pet health insurance in the future because technology and the costs of delivering quality healthcare to pets have outpaced the ability of many pet owners to pay for it. While pet owners and veterinarians can potentially benefit from third party insurance company payments to help pay for the healthcare of their pets, the real winners will be the dogs, themselves!

It’s a simple fact – mishaps occur, and your dog can get sick! That’s why there’s pet health insurance to help you cover the cost of treating your dog’s unexpected illnesses, accidents and injuries. In other words, with pet health insurance, you can guard against illnesses or accidents before they happen!


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