Is Pet Insurance Worth It for an Indoor Cat or Dog?

Costs of Owning a Cat or Dog

With average annual routine veterinary care costing between $200 and $400 for a dog—and $90 to $200 for a cat—routine care is not the main reason you might want to consider pet insurance. This is particularly true because the average annual Wellness policy can cost $300 per year.

It’s the accident and illness part that drives up costs and is the primary reason pet owners buy insurance. For example:

• The cost to diagnose diabetes in a cat runs about $300. Treatment generally continues for the rest of the animal’s life and costs $240 to $360 per year.

• If your pet develops heartworm, treatment could run between $400 and $1,000.

• Emergency room care in the case of an accident could run $1,000 or more.

• A torn ACL might cost up to $3,300 to treat and repair.

• The big “C” (cancer) could cost $5,000 or more, depending on treatment.

Another factor that helps determine cost of care is breed. This is especially true for dogs, due to the fact that certain breeds are predisposed to develop certain medical conditions. Hip dysplasia—a condition in which the bones that make up the hip ball and socket of large dog breeds such as retrievers are not aligned and cause pain—is one such example. This can eventually lead to hip replacement surgery, which can cost as much as $3,500 to $7,000 per hip.

What Is Pet Insurance?

Pet insurance is the pet equivalent to human health insurance. Having your dog or cat protected by a good health insurance plan can put your mind at ease by knowing that large, unexpected medical bills will be covered.

There are three types of pet insurance coverage: accident, illness, and wellness. Depending on your preference, you can sign up for one, two, or all three of these coverages (but not all pet insurance companies offer wellness plans).

1. Accident Coverage

You can’t predict an accident, but you can plan ahead for potential incidents that could cost you a fortune. Every pet insurance company offers accident coverage, which can include：

• Torn Ligaments

• Broken Bones

• Bite Wounds

• Foreign Body Ingestion

• Poisoning
  

• Eye Tauma

• Injuries

• Emergencies

2. Illness Coverage

Many pet insurance companies limit their illness coverage as pets age. It’s essential to get insurance while your pet is young to reduce pre-existing condition exemptions and your monthly cost. Illness coverage can cover things like:

• Skin Infections

• Cancer

• Arthritis

• UTls

• Allergies

• Ear Ifections

• Vomiting and Dirrhea

• Obesity

• Internal Parasites

3. Wellness Coverage

Is pet insurance worth it for wellness/preventative coverage? Wellness coverage is always optional because, depending on your preferences, you can pay for wellness expenses on your own or invest every month with an insurance company to avoid paying out of pocket all at once for routine vet visits.

A pet wellness plan may cover fees associated with:

• Annual exams

• Spay/neuter procedures

• Routine blood panels

• Heartworm testing and treatment

• Fecal testing

• Urinalyses

• Routine vaccinations (e.g., rabies, distemper, hepatitis, leptospirosis, parvovirus, Bordetella)

• Teeth cleanings

• Flea and tick treatments

Keep in mind: a single routine annual vet exam can cost upwards of $300 depending on your vet, where you live, and the types of procedures, vaccinations, and tests your pet requires. Wellness plans are becoming increasingly popular to manage these expenses, so more companies are offering them, including an add-on to some pet health insurance plans. But not every company covers every item you may expect in a preventative care package, so be sure to read the fine print before you sign up.

Costs of Pet Insurance

The cost of pet insurance varies depending on where you live, your pet's age and breed, and the level of coverage you want. In most cases, you'll end up paying between $25 and $70 a month to insure your dog and between $10 and $40 a month to insure your cat.

These costs can be lower or higher depending on how much coverage you want. For example, you can increase your premium in exchange for a larger payout when your dog or cat gets an eligible treatment.

If you're looking to purchase a policy, get a quote from an insurer's website. You can also compare pet insurance plans to find the policy that best matches your budget and desired level of coverage. The table below shows quotes for two sample pet profiles: a 4-year-old male Labrador and a 4-year-old female Bengal cat. For older pets, the costs of pet insurance will likely be much higher and may not be worth the expense.

Top 5 Pet Insurance Comparison: Nationwide vs. Lemonade vs. Trupanion vs. Pet Plan vs. Healthy Paws

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Comparing Coverage and Cost

While there are many variables when it comes to the cost of pet insurance and the coverage provided by the amount you pay, a basic comparison of coverage and cost is possible.

Wellness Coverage vs. Wellness Cost

The average cost of wellness coverage is $240 to $300 per year ($20 to $25 per month). Recall from above that the average cost of wellness or routine care is $90 to $400. If you use every available care option (some, such as spaying/neutering, can only be used once), you stand to come out ahead as much as $160, at least in that spay/neuter year. Depending on how many care options you actually use, you could just as easily lose money. For that reason, most experts advise against wellness coverage.

Accident-Only Coverage vs. Accident Cost

The average annual premium for accident-only coverage is $126 to $194 ($11 to $16 per month). Even if your pet never swallows a foreign object, breaks a bone, or gets hit by a car, many pet owners believe the relatively low cost of accident coverage is worth the peace of mind it brings. As noted above, owners of older animals that no longer qualify for illness coverage may find that accident-only coverage is their only reasonable alternative.

Accident and Illness Coverage vs. Accident/Illness Cost

The majority of pet insurance policies written (98%) are for accident and illness. The average annual premium for dogs is $585 ($48.50 per month) and for cats $350 ($29 per month). This does not include wellness coverage, which is typically an extra-cost add-on. If your pet suffers no accident or illness, you recover nothing during the year. On the other hand, if it gets cancer, most of the up-to-$5,000 cost of treatment will be reimbursed.

Some pet owners end up paying an insurance premium for years and never receive the benefit, but it's better to think of insurance as an annual cost. If nothing happens to your pet during one policy year, then you've protected your pet and your wallet for the next year.

Is Pet Insurance Worth It?

Like property insurance (car, home, etc.), you won’t necessarily “save” or “make” money in an average scenario, but in the event of a catastrophe, you may find it’s worth the investment. Unlike human insurance, pet insurance is more about peace of mind and being prepared for a potential emergency than guaranteed savings.

While you may not get the most bang for your buck with a relatively healthy pet, there’s no way to predict what illnesses or injuries might occur, and for many pet owners, knowing they have a safety net in place is value enough.

“Pet insurance can help offset routine medical expenses and can be especially helpful for the unknown,” said Dr. Jennifer Welser, chief medical officer of BluePearl Veterinary partners in Tampa. “Keeping the coverage may give you the freedom to make medical decisions for your beloved pets based on quality of life, not finances.”

If you do decide to get pet insurance, enroll your pet when they’re young for maximum savings. Talk to your vet to get an idea of your pet’s potential breed-specific health problems, and ask them which insurance they’d recommend. If you decide to choose catastrophic coverage (generally the best cost-to-savings option), spring for the highest deductible you can afford.

Whether or not you opt for pet insurance, start an emergency fund now for vet care to make sure you can handle unexpected out-of-pocket costs. 

How Do I Choose The Right Dog Insurance?

Before you purchase your dog’s insurance plan, be sure to familiarize yourself with what each plan offers. Compare the coverage provided under each plan with individual health concerns for your dog and his breed.

Medical billEven if you have a healthy puppy today, knowing what illnesses are prevalent in your dog’s breed will help you select the right plan. Talk with your vet about what you should plan for as your pet ages. For example, some breeds are more susceptible to hip and joint problems and cancer. While no one wants to anticipate the worst, it’s the best plan of action when shopping for your dog’s insurance policy. Choose the best plan based on the right cost AND coverage benefits, not price alone.

1. Narrow down your choices.

2. Contact at least three companies and obtain quotes based on the information you provide about your pet’s breed, age, health, and needs.

3. Have your vet send in each of your pet’s records to the company that you’re considering. A company that’s genuinely interested in your business will review your pet’s records and clearly outline any excluded conditions from your pet’s insurance plan (such as pre-existing conditions). It’s important to understand the coverage details before you buy any insurance plan.

4. Weigh the cost of monthly premiums against the types of coverage offered: accident, illness, and wellness, as well as any add-ons.

5. Review plan deductibles and payout percentages that may impact your real out-of-pocket costs.

6. The sooner you sign your pet up for health insurance, the lower the premiums. Consider purchasing a plan for your puppy before they get too much older and possibly develop pre-existing conditions. 

Note: No pet insurance company covers pre-existing conditions, but different companies may have different criteria and waiting periods for what they consider a pre-existing condition. If you’re unsure, ask. It’s better to know upfront.

You should expect annual increases in your premiums from most pet insurance companies. These rates and increases will vary based on your location, changes in vet costs, and more.

What Criteria Do I Need To Consider?

• A.M. Best Ratings

• BBB Ratings

• Claim Repayment Reputation

• Contract Coverage

• Customer Service

• Frequency Of Vet Visits

• Price

• Plan Customization

How to Get Pet Insurance：

To sign up for pet insurance, you’ll need the following information for your pet:

• Name

• Breed

• Age

• Pre-existing conditions (if any)

• Vet’s name and contact information

Have your pet seen by a vet if you haven’t done so within the past year.

Most policies have waiting periods, which means you can’t get coverage immediately following an accident or illness. (This ensures people don’t sign up for coverage only when they know they need to cover a big bill.) So if you think you’d be interested in pet insurance, apply now before you end up needing it.

Tips for Buying Pet Insurance

The standard of value in pet insurance is not found in scoring more benefits than you pay in premiums; rather, you’re buying peace of mind knowing that you’re covered against the risk of being inundated by vet bills.

If you have the bucks, and you’re willing to pay any price for advanced veterinary medicine to save your seriously ill or injured pet, here’s how to find the best pet insurers and get the best deal:

• Before buying, learn how your premium will increase as your pet ages by using the insurer’s online quote engine. First, get a monthly premium quote using your pet’s age; then get quotes for the 10 or 12 ensuing years. Multiply each age’s monthly premium by 12; then add up all the resulting annual premiums to estimate what insurance will cost over that period.

• Understand what’s not covered. A leading complaint to regulators is claims being rejected for conditions or treatments not covered by the policy. No policy covers preexisting conditions, and some conditions that are covered may be considered preexisting if they develop up to a year after you enroll. If your pet is ill or injured, the diagnostic exam is often not covered by many plans, even though the treatment is covered. Follow-up exams for that covered condition are often not covered, either. Those $50 to $100 exam fees amount to a hidden added deductible.

• Avoid claim rejection for a preexisting condition by insuring your pet when it’s a puppy or kitten — before it has a chance to develop a preexisting condition (but don’t forget the caveat above). You can typically enroll when your pet is 6 to 8 weeks of age.

• Forget add-ons for wellness, preventive and elective care. When Checkbook added up the lifetime costs of Woof’s routine care, about $2,400, and used that information to compare Nationwide’s Major Medical illness and injury plan with its Whole Pet with Wellness plan, it found that adding wellness coverage was a poor deal. Total lifetime Whole Pet premiums for Woof were much higher — almost $11,400 more — almost five times the dog’s lifetime wellness costs. For moderate-problem Woof, that helped raise the owner’s total out-of-pocket costs by about $9,900 with Whole Pet, 70 percent more than with Major Medical. Even for high-problem Woof, Whole Pet cost the policyholder $260 more in out-of-pocket costs vs. Major Medical, a 1 percent increase.

• Consider accident-only policies, which cover injuries but not illness and can be considerably less expensive. ASPCA would charge Woof $35 a month for its accident-only plan, a price that doesn’t increase with age.

• You must pay premiums every month, but you may or may not have to pay deductibles and co-pays, depending on your pet’s health. So it may be worth it to cut your premium costs by increasing your deductible, reducing the percent reimbursed, and choosing an annual limit of only $5,000 or $10,000 instead of unlimited. These are standard insurance cost-reduction tactics, but be aware that they shift more of the risk of future vet bills to you.

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