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Is pet insurance worth the price?
The most important thing you need to know about pet insurance is that it is a form of enforced savings that almost never covers the entire bill. You can accomplish the same thing by paying the same monthly premium to your savings account.
The advantage: If your pet has little cause to visit a vet beyond annual checkups, the amount saved belongs to you, not an insurance company. The risk, of course, is if you run into unusually expensive veterinary needs, though our money-saving tips show how to avoid or reduce those (see 20 ways to cut vet costs).
The problem with pet insurance is all its fine-print pitfalls. Indeed, buying a policy may end up increasing a pet owner's total expenditures on veterinary care by thousands of dollars, according to our analysis of five plans. That's because on top of deductibles required by all the insurers, plus any co-pays, unreimbursed costs, and exclusions--all of which you pay out-of-pocket--you also pay premiums. Seemingly small $11 to $50 per-month premiums can add up to $2,000 to $6,000 or more over a pet's lifetime.
"That's quite a bit of money to shell out ‘just in case,'" says Dr. David Lee, a lecturer on practice management at Cornell University's College of Veterinary Medicine. "A lot of pets go for many years living a long healthy life without ever needing a $1,000 to $2,000 procedure."
Poor value may help to explain why less than 1 percent of pet owners have bought pet insurance.
To assess this insurance, we created "Lucky," an Oakland, Calif., Labrador retriever, the most popular of purebreds, and gave him some of the most common problems that vets see. We then calculated the benefits that a selection of policies would pay and the premiums Lucky's owner would bear over 11 years.
The results appear in the table below.
 COMMON AILMENTS: Pet insurance is no bargain |
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"Lucky" had 9 claims over 11 years--a broken leg, an ear infection, a cut requiring stitches, an eye infection, hypothyroidism requiring years of drug claims, and a torn knee ligament. Total cost of care: $3,301. The insurance plans below would have cost Lucky's owners an extra $497 to $3,380 for care. |
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Cost of care |
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Savings (or extra cost)
with insurance |
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WITHOUT INSURANCE Cost is total vet bill. |
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Directly to vet |
$3,301 |
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- |
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WITH INSURANCE Cost includes co-payments, deductibles, and premiums. |
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PetsHealth Care Basic |
3,798 |
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($497) |
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Veterinary Pet Insurance Standard |
3,852 |
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(551) |
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Pet Care QuickCare Gold |
4,707 |
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(1,406) |
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Veterinary Pet Insurance Superior |
4,903 |
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(1,602) |
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Pet Care QuickCare
Gold Double Benefits |
6,681 |
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(3,380) |
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| MAJOR PROBLEMS: Some plans may save you money |
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If Lucky had the problems described in the chart above over 11 years plus needed major surgery such as hip replacement, the total cost of his care would have been $10,414. Three plans in our study would have paid more in benefits than Lucky's owners would have paid in total costs. But because this scenario is unlikely, a savings account is still a better option. |
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Cost of care |
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Savings (or extra cost)
with insurance |
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WITHOUT INSURANCE Cost is total vet bill./div> |
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Directly to vet |
$10,414 |
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- |
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WITH INSURANCE Cost includes co-payments, deductibles, and premiums. |
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Pet Care QuickCare Gold Double Benefits |
7,794 |
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$2,620 |
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Pet Care QuickCare Gold |
8,820 |
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1,594 |
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PetsHealth Care Basic |
9,411 |
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1,003 |
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Veterinary Pet
Insurance Standard |
10,965 |
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(551) |
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Veterinary Pet Insurance
Superior |
12,016 |
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(1,602) |
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