Stacks of $100 bills

Part 5. Still Wondering if Pet Insurance Is for You?

This is the fifth of a five-post client information series Brownsburg Animal Clinic is offering on pet insurance—part of our Pet Care Costs collection of posts and pages to help you manage the costs of pet ownership more effectively. As they describe step-by-step processes, we suggest you read the Pet Insurance posts in order from first to fifth.

If you’ve read our four previous posts about pet insurance and remain unsure if it’s for you, we’re guessing you may have become overwhelmed and abandoned our suggested purchase process somewhere along the way. 

As we’ve noted before, choosing pet insurance is a complex purchase decision. Unfortunately, there are few if any shortcuts for a pet owner who wants to make a well-informed choice of coverage for a cherished pet. 

Maybe the complexity of the purchase is part of the reason why only 2-3% of American pets are insured. 

Other reasons reported by pet owners who haven’t bought pet insurance include thinking it’s too expensive, thinking it’s not worth the money, not knowing what it covers or never having heard of pet insurance in the first place.

The best reason not to buy pet insurance is knowing you can easily afford to pay any vet bill that may come your way for the rest of your pet’s life—even bills totaling tens of thousands of dollars. 

So who buys pet insurance? 

According to its “State of the Industry Report 2023,” the North American Pet Health Insurance Association (NAPHIA), California leads the way in insuring pets with 18.6% of pets covered as of year-end 2022, followed by New York at 7% and Florida at 6.2%. 

But in Indiana, only 1.3% of pets had insurance coverage at the end of 2022. 

NAPHIA reports most insured pets in the USA are dogs, accounting for 80.1% of the total in 2022. Insured cats’ market share has been growing every year since 2017, with an increase of 19% in 2022, bringing them to 19.9% of all insured pets at year-end.

BBVA, a global wealth management concern based in Switzerland, identifies Sweden as the country with the highest number of insured pets—80%. In the United Kingdom, 30% of pets have insurance. In Spain, fewer than 5%. says about 7% of pets in Australia are insured.

Clearly, apart from the Swedes, most pet owners throughout the world elect not to insure their pets. As veterinarians who deal every day with clients who tell us they can’t afford the care we offer, we think that’s a shame. 

Although we’ve elected not to recommend specific policies and companies, we do believe most our our clients would benefit from insuring their pets, and most of our patients would benefit from being insured. If you’re still wondering if pet insurance is for you, read on.

Why Buy Pet Insurance At All?

To address any misgivings you may still have about buying insurance for your pet, we suggest you consider why you became at least mildly interested in buying pet insurance in the first place. 

If you’re like most pet insurance shoppers, your primary motive for buying a policy is to reduce the impact of financial considerations on major, possibly urgent, life-and-death veterinary care decisions you may face in the future impacting the pet you love.

Whether it’s helping pay for expensive emergency surgery or ongoing, lifelong management of a newly-diagnosed chronic condition, a well-chosen pet insurance policy frees you to choose the best treatment options for your pet without having money—or the lack of it—limit your choices or, at worst, resort to “economic euthanasia” because you simply can’t afford to treat your ill or injured pet. 

A sound policy from a reputable insurer with well-chosen policy options lets you enjoy the peace of mind that comes with knowing the impact of unexpected, potentially sizable vet bills on your finances will be manageable. You know you’ll be able to provide what’s best for your pet as well as what’s best for your bank accounts.

So Is Pet Insurance Really for You?

In his book, Pet Health Insurance: A Veterinarian’s Perspective, Dr. Doug Kenney asks two questions that together, can help you decide if pet insurance is for you.

  • How much would you be willing to spend to save your pet’s life if there is a reasonable chance of recovery and a good quality of life after treatment?
  • How much would you be able to spend to save your pet’s life if there is a reasonable chance of recovery and a good quality of life after treatment?

If you’d be willing to spend more than you are able, Dr. Kenney writes, “you should seriously consider the purchase of pet insurance.”

Dr. Kenney continues, “Whenever you are faced with the decision about whether to go forward with treatment when your pet has a serious illness, you want the decision to be based on prognosis for recovery and quality of life rather than finances.”

If you want to minimize money as a factor in your decisions about your pet’s medical care, pet insurance can help you accomplish that.

Keep in mind, regardless of the type and amount of insurance coverage you ultimately decide to buy, you still need immediate access to cash and an available credit line to cover the up-front costs of your pet’s treatment. After you file your claim, you can use any reimbursement for covered expenses you receive from the insurance company to pay down your debt or replenish your savings.

In Lesson 4, Part 3, of her online “Pet Insurance Guide,” Dr. Fran Wilkerson presents a more comprehensive “Pet Insurance Test” you can use to determine if pet insurance really is for you. If you still have doubts about buying pet insurance, we strongly recommend Dr. Wilkerson’s test as a way to clarify your thinking.

Bad Advice and Dumb Ideas

As part of your research, if you ventured beyond our posts, it’s likely you encountered plenty of additional advice on the pros and cons of pet insurance. Some of the information is accurate and truly helpful, but some of the suggestions are best ignored. For example—

Instead of paying the insurance company, just deposit the premiums into a savings account. Sorry, but this advice to self-insure just doesn’t add up—at least, not for decades, and it surprises and frustrates us when we see this idea passed off as a viable strategy. 

In 2022, the North American Pet Health Insurance Association reports the average annual premium for a policy covering accidents, illness and wellness expenses for a cat averaged $613.67. For a dog, the total was $1,134.29. Accident and illness coverage alone for a cat averaged $387.01 and for a dog, $640.04.

If, instead of paying insurance premiums, you deposited the money in a savings account, by the end of the first year you’d have accumulated a whopping $387 to $614 to meet emergency medical expenses for your cat or $640 to $1,134 to self-insure your dog. 

You do need savings on hand, not only to cover expected expenses for wellness care, but to help pay the policy deductible and co-insurance, bills for treating pre-existing and other excluded conditions as well as any large, unexpected vet bills. You also need available credit to cover any shortfall between cash on hand and the total amount of money you need immediately to pay vet bills up front.

Even if you increased your savings from year to year to allow for premium increases, it would take many years for you to accumulate sufficient savings to cover the costs of just one fairly serious injury or illness. And once you paid the vet bill, your savings would be wiped out—and then some—with no reimbursement on the way.

The idea of self-insurance is certainly valid for those who can afford it. We expect you know who you are. 

If your pet had an injury or illness that ended up costing $10,000—$20,000—$30,000 or more to diagnose and treat and you know you would be willing and able to pay it without a second thought, then you probably don’t need pet insurance. You may want it, though, just as you want other types of insurance to manage financial risk and protect your assets. 

Do the math to see if the policy has paid more in claims than you’ve paid out in premiums. Adding up the premiums you’ve paid so far, measuring it against claims reimbursements you’ve received and declaring pet insurance a mistake—one YouTuber even called it a scam—if your claims don’t exceed the premium total betrays a misunderstanding of the nature and purpose of insurance. 

Don’t let any self-appointed “experts” convince you to think in these terms.

You buy insurance to  manage risk—not to make a profit. The more claims you have, the more misfortune you and your pet have experienced. The insurance helps mitigate the negative financial consequences of those misfortunes, but having your claims exceed your premium totals is generally a bad, sad situation. 

If you’re not using your pet insurance, you should cancel it. The whole point of insuring your pet is to protect your financial assets in case of an unexpected, potentially expensive accident or illness. If you don’t have such an expense, that’s a very good thing.

Meanwhile, you are using the protection your policy provides every day the policy is in force, whether or not you ever make a claim. Having insurance gives you peace of mind and the choice of treatment options you would lose if you cancelled the policy and took on all the risk yourself.

The pet insurance company might deny your claim. If you read enough one-star reviews from policyholders on pet insurance review sites, you may begin to wonder if you can really count on any insurer to pay claims. 

The answer is yes—you can count on insurers to pay eligible claims according to the terms of the policy. But no, they won’t cover expenses they’ve explicitly excluded in the policy contract. Disgruntled policyholders do sometimes dispute claims denials and appeal insurers’ decisions. Sometimes they prevail.

More often, you can tell from the commentary that the unhappy policyholders didn’t bother to look beyond the premium quotes and the marketing copy before enrolling their pets. They don’t have a clue what their policies cover, but they’re angry those policies don’t cover what they assumed they would.

If you take the time to read and understand the policy before you buy and are honest with the insurance company when you sign up and later file claims, you can expect to receive your reimbursement as promised. It’s the law.

Ask your veterinarian to recommend a policy and just buy that one. It’s very commonly suggested that you ask your veterinarian for advice about pet insurance. What a handy shortcut that would be!

We are more than happy to answer these kinds of insurance-related questions:

  • What pre-existing conditions are already documented in my pet’s medical records?
  • Do the records show we’ve discussed and treated any common symptoms—like vomiting or diarrhea—that could later be interpreted as an early sign of a condition that gets diagnosed after the policy is in force?
  • What potential health problems will a pet of my pet’s age, breed and current state of health be most likely to encounter in the future?
  • What can I expect to spend on wellness—annual exams, vaccines, parasite preventives, dental cleanings—in the coming year? Can you prepare an itemized estimate for me to compare to a wellness plan reimbursement schedule?

The question we are not qualified to answer: What is the best pet insurance company and/or policy for me to buy for my pet? 

And if you’ve already bought a policy, we’re not qualified to tell you what it will and will not cover.

Even if our doctors were like Doug Kenney and Fran Wilkerson—the two veterinarians who are recognized experts in pet insurance—we would have no business telling you a specific policy to buy. 

While we do know quite a lot about your pet’s past and present state of health, we don’t know exactly what your pet’s health care needs and expenses will be in the future.

We don’t know the pet insurance policy features you would value most and we don’t know your personal financial situation. 

We don’t know all the companies and policies flooding the pet insurance market. 

We don’t know what problems you may encounter with an insurer—even one we have every reason to consider reputable—should the insurer deny a claim, delay a reimbursement or dramatically increase premiums from one year to the next. 

And frankly, we never want to hear a disgruntled client of ours say, “But you told me to buy that policy.”

Instead, with our pet insurance blog post series, we’re suggesting one way to go about choosing the best policy for you and your pet on your own. 

Admittedly, pet insurance is complicated, but if you follow our suggested steps, it’s certainly possible for you to understand well enough to make a sound buying decision. 

Then, it’s up to you to act promptly and insure your pet before any health problems occur. 

Never Too Soon

We’ll leave the final words of our series to Doug Kenney and Fran Wilkerson.

“I’ve never talked to anyone who regretted buying pet insurance too soon,” says Dr. Kenney, “but I’ve talked to many who regret not buying it soon enough.”

“Get pet insurance as early as possible,” adds Dr. Wilkerson.