Is Pet Health Insurance Really Necessary?
Veterinarian Reviewed on March 5, 2009 by Dr. Janice Huntingford
According to the American Pet Products Manufacturers Association, the typical dog owner spends $800 per year on veterinary care, whilst the typical cat owner spends about $500 per year. It therefore makes sense to have health insurance for pets.
Vet bills have increased over the years mostly because Veterinarians are now using sophisticated diagnostic tools, such CAT scans and MRI’s. These very expensive medical tools help in detecting any problem that may require further medical treatment, such as kidney transplants and radiation therapy.
Just as there are different companies that offer pet health insurance, there are different types of policies that are available.
One of the most economical pet health insurance plans are those that are considered to be safety plans. These plans only cover veterinary treatment for injuries, such as broken bones and bee stings.
The next level up is where you will find the more common wellness plans. Such plans are typically found in veterinary offices that are housed inside major pet stores. They usually include routine care, like physicals and vaccinations. There has been some debate, however, on whether or not this type of plan would actually save you money. It seems that in some cases the premiums, deductibles, and co-pays for routine care usually costs a bit more than paying out-of-pocket. However, should your pet get injured, such a plan may save you money.
The most expensive pet health insurance plans are called comprehensive plans. These are the policies that cover a broader range of treatments, such as cancer medications and acupuncture.
Another type of policy are HMOs. These work similar to the HMOs for humans: The pet owner will usually pay a nominal monthly fee. When your pet is treated by a vet who is an HMO participant, the vet will then submit all of the insurance paperwork directly to the HMO and will then get reimbursed directly from the HMO. The major disadvantage to this type of pet health insurance policy is that your choice of Veterinarian is limited to only those who are participants in the HMO plan.
Policy Exclusions and Limitations
When deciding on a pet health insurance policy, you should also think about the coverage exclusions, limitations, and other costs that are common to pet insurance plans:
Deductibles – How much do you have to pay out-of-pocket each year before the insurance coverage takes effect?
Co-payments – What is your co-payment? What percentage of the treatment does the insurance cover?
Annual and lifetime caps – Does the policy include any annual or lifetime cap? Keep in mind that once you go over the cap, you will have to pay out-of-pocket for any further treatment that your pet may need.
Unfortunately, most policies have exclusions for hereditary conditions, and will not cover health problems that are common in certain breeds of dogs or cats.
Make sure that you understand your policies benefit schedules and know how much the policy will pay for certain procedures as you do not want to be sitting with an additional expense. For example, your dog has broken his leg and you take him in to see the Vet. The Vet sets the leg and bills your insurance $300. Your insurance may have capped such a charge to only $250. You will then be responsible for the remaining $50.
Do You Need Pet Insurance?
Before deciding on whether or not pet health insurance is the right choice for your family and pet situation, calculate how much you’ll pay for vet care if you did obtain insurance by adding up all the premiums, deductibles, co-pays, and expenses after caps. Then compare that amount to how much you would have to pay out-of-pocket if you didn’t have any pet health insurance.
There are a few factors to consider when trying to figure out how much you will be paying:
Higher premiums are always given to older pets. There are even a few policies that refuse to cover dogs that are older than 10 years. On the flip side, your premiums will go up as your pet ages.
Dogs and cats that are considered to be purebred usually have more health problems than mixed breeds. Some policies will not cover certain breed-specific ailments.
If your pet is in general good health and is not overweight and does exercise, then your pet’s healthcare costs will be lower. Keep in mind as well that indoor cats have far less injuries than outside cats.
The toughest question to consider is how much you would be willingly to pay to keep your pet alive? Having adequate pet health insurance may help by reducing the chance that you’ll have to put a dollar value on the life of your pet.
Choosing the Right Policy
If you truly feel that pet health insurance is right for you, then keep the following in mind:
Always shop around for the best available policy. Ask for recommendations from your Veterinarian and friends and neighbors. Search online and compare policies and prices.
Make sure that the pet health insurance company that you choose is registered with your state’s Department of Insurance.
Check to see if your employer offers any pet health insurance plans.
Be sure that have read and understood all of the fine print before signing any contract. Know about all the costs involved such as premiums, co-pays, and deductibles. Find out whether the premiums will rise as your pet ages or if you file multiple claims. Also remember to pay close attention to any exclusions, such as dental care, vaccinations, and breed-specific health conditions.
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Janice Huntingford, DVM, has been in veterinary practice for over 30 years and has founded two veterinary clinics since receiving her Doctor of Veterinary Medicine at the Ontario Veterinary College, University of Guelph. She has studied extensively in both conventional and holistic modalities. Ask Dr. Jan