If you’ve ever taken a sick pet to the vet’s office, you know the pain of seeing your four-footed family member hurting. Then, of course, comes the secondary anguish of figuring how to pay for their veterinary care, which may have you wishing you’d ponied up for pet insurance.
While Insurify reports that the average cost of a routine vet visit is about $138 for a cat and $214 for a dog, emergency veterinary care can run the gamut from $300 to $10,000, according to Marketwatch.
The insurance industry touts pet insurance as the financial solution to the high cost of veterinary care. Like human health insurance, you pay monthly premiums so that your pet insurance will help cover veterinary bills for your dog or cat (and in some cases for your exotic pet) when you make a claim.
But is pet insurance worth the money? And does it truly help lower the cost of pet ownership? Here’s the skinny on pet insurance so you can decide if it’s right for your fur babies, reptile pals, and/or feathered friends.
Coverage options
Typically, there are three types of coverage options for pet insurance: accident-only, accident and illness, and wellness coverage, according to the North American Pet Health Insurance Association (NAPHIA).
Just like it sounds, accident-only will pay for veterinary care when your pet needs treatment because of an accident. This is the least expensive type of pet insurance coverage.
Accident and illness coverage will cover treatment for accidents and also any other injuries, disease, or changes to your pet’s normal health. This might include some kind of embedded wellness coverage, but that is usually a rider or add-on to an accident and illness policy.
Finally, wellness coverage—which most insurers will not sell as a standalone plan—is a preventative or routine care plan. It generally includes coverage for things like vaccinations, tests, and dental work. This is the most expensive type of pet insurance available, in part because it’s usually purchased alongside an accident and illness policy.
Coverage limitations
If this sounds a little too straightforward and lacking in insurance industry shenanigans, don’t worry! There are shenanigans aplenty.
To start, every insurance company gets to decide which specific ailments, conditions, and veterinary services it will cover, and of course not everything is covered by every plan. Coverage can vary depending on the specific breed of your pet, since some breeds are prone to hereditary and congenital disorders that insurers will not cover. Additionally, diagnostic exams for illnesses generally aren’t covered, even if treatment for the illness itself is.
And then there’s the exclusion for pre-existing conditions. Just like human health insurance, pet insurance won’t cover any preexisting health problems. Many pet insurers define “preexisting” pretty liberally, too, considering any health issue that occurs within a year of purchasing the policy to be a preexisting condition.
Premium expectations
To receive the pet insurance coverage, you’ll pay a monthly premium, just like with your human health insurance. Paying these monthly premiums makes it possible to afford the high cost of veterinary care for your pets.
NAPHIA found that in 2024, accident-only pet insurance premiums cost an average of $16.10 per month ($193.29 annually) for dogs and $9.17 per month ($110.03 annually) for cats. Accident and illness coverage cost an average of $62.44 ($749.29 annually) for dogs and $32.21 per month ($386.47 annually) for cats in 2024.
But the operative word here is “average.” Just as health insurance companies may increase premiums each year, many pet insurers may raise premiums as your pets age, since the likelihood of filing a claim increases as Zeus and Jasper age. That can make pet insurance premiums more difficult to keep up with as your furry companions are more likely to need age-related medical intervention. Add in the potential higher premium prices for hereditary or congenital conditions for certain breeds, and premiums may be out of reach for some pet owners.
Premium affordability
That’s not to say that you have no control over the cost of premiums. Just like with other types of insurance, making tweaks to your policy can help lower your premium prices. For instance, increasing your deductible is an easy way to lower your premiums to a more affordable level. Just make sure you have a plan for meeting the higher deductible if you need to make a claim.
Alternatively, you could increase your coinsurance amount, which refers to the amount of money the policyholder must pay toward the cost of a claim. Most pet insurance offers a default coinsurance amount of 80%, meaning the insurer pays 80% of the claim, while the policyholder covers the remaining 20%. Choosing a coinsurance amount of 70% or less can help reduce your monthly premium costs.
Claims process
One important difference between your health insurance and pet insurance is how the claims process works. Pet insurance almost universally requires you to pay your vet out of pocket and file a claim with your insurer for reimbursement—after you have met your annual deductible.
In other words, even though pet insurance can make eye-watering vet bills more affordable and make heart-wrenching medical decisions for your beloved animal less fraught, it’s not as though this kind of insurance relieves you of the immediate financial stress of a vet visit.
Even if you have pet insurance, you still need to have either the cash or the credit available to pay the vet before you can be reimbursed.
What’s best for Bella and Loki?
Considering the coverage gaps, reimbursement requirements, and potential caveats, you might be thinking pet insurance is more trouble than it’s worth. If you have the financial discipline to make it happen, put aside an amount equal to a monthly premium into a savings account for your pet’s future veterinary care. But if that doesn’t sound like something you’re likely to do, pet insurance can be a good way to protect your animal companions without having to make heartbreaking financial decisions.
Make sure you understand what coverage options are available from various pet insurance providers, as well as the coverage limitations. Even if the premiums are relatively low for your pets now, find out if they may go up as your pets age. Remember, you can help keep your premiums affordable by increasing your deductible or your coinsurance amount.
And whether or not you decide to get a pet insurance policy, remember that the claims process is based on a reimbursement model. Even with insurance, you need to pay the veterinarian out of pocket for covered care and get reimbursed, so you’ll still need to have access to funds to pay for kitty’s kidney stone removal at the time of care. Which means it’s a good idea to beef up your emergency fund whether or not you opt for pet insurance.
Then you can enjoy the wagging tails and throaty purrs without worry.
