Is Pet Insurance Worth the Price?

Pet Insurance: To Buy or Not To Buy

Fifi and Fido are part of the family, right? So shouldn't you have pet insurance for your furry friend just like you would have health insurance for any other member of your family? Not necessarily. Before you run out and buy a pet insurance policy, there are some things you need to consider.

Less Than 1 Percent

Did you know that less than one percent of the pet owning population has purchased a pet insurance policy for their pets? This isn't because 99 percent of pet owners don't adore their furry family members. It's because pet insurance doesn't always make sense.

Doing the Math

Sometimes pet owners with pet insurance end up paying more out of pocket than they would have had they just put those premiums into a savings account.

Let's say, for instance, that you pay $11 per month for Fido's pet insurance policy and after ten years Fido gets an injury and you need to go to the vet. So far, the policy has cost you $1,320 in premiums over the past ten years. The vet bill is $650, but you have to pay a deductible and other uncovered expenses so the pet insurance only actually covers $550 of that bill.

The above scenario means you've paid $1,320 in premiums for $550 worth of coverage. Had that $1,320 been put in an interest-bearing savings account you'd be ahead of the game. Because you opted for pet insurance premiums, you're actually taking a loss.

The Bottom Line

If you have a pet and you're worried about having money to pay unexpected pet bills, you may want to forgo the pet insurance premiums and put $10 or $20 a month in an interest-bearing savings account. If you need it, it's there. If you don't, at least you didn't throw it away on premiums for a policy you never had to use.

That being said, there are times when pet insurance does indeed make sense. For more information on when pet insurance is a good idea and how to choose a pet insurance provider, read this pet insurance article.

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