Is Pet Insurance Worth It? Evaluating the Cost

Pets are part of the family. To ensure they live long, healthy, happy lives, we must foot the bill for expensive veterinary care—for checkups, illnesses, and injuries. But this can put a strain on many pet parents’ wallets.

Pet insurance ensures you get the veterinary care your pet deserves without taking on debt or draining your emergency savings. So, is pet insurance worth it? We’ll explore how much pet insurance costs (and what you get for that monthly premium) to help you decide.

How much does pet insurance cost?

The average cost of pet insurance is $56.30 a month for dogs and $31.94 a month for cats, with an accident and illness policy, according to recent data from the North American Pet Health Insurance Association (NAPHIA).

However, pet insurance costs can vary depending on several factors:

Breed

Certain dog and cat breeds are more prone to illness, injury, and shorter lifespans, which can lead to higher pet insurance premiums.

According to Figo, the five most expensive dogs to insure are:

• Bernese mountain dogs
• Great Danes
• English bulldogs
• Rottweilers
• Dalmatians

Age

Getting pet insurance when your animal is young can ensure you’ll lock in a lower rate—but you should still expect prices to go up over time. Senior dogs and cats are more expensive to insure.

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Location

Where you live affects the cost of pet insurance because the cost of veterinary care varies across different cities and states. Some companies, such as Lemonade, aren’t available in every state.

Company

Certain pet insurance companies are more expensive than others. The more expensive companies tend to offer unique coverages, shorter waiting periods, faster claims processes, and better customer service.

Coverages

The breadth of coverage you choose—as well as the deductible, annual benefit limit, and reimbursement rate—can affect your pet insurance costs.

The table below shows how choosing an accident-only plan instead of an accident and illness plan can lower your pet insurance costs. All data is from NAPHIA.

Pet	Accident-only plan	Accident and illness plan
Dog	$17.01 a month	$56.30 a month
Cat	$9.68 a month	$31.94 a month

What does pet insurance cover?

Pet insurance coverages vary by insurance company and the plan you choose, but a typical pet insurance plan covers:

• Injuries
• Illnesses and medications
• Emergency vet care
• Surgery
• Cancer treatment
• Breed-specific conditions
• Treatment for chronic conditions
• X-rays and diagnostics

Many pet insurance companies allow you to tack on additional coverages, including wellness plans, behavioral therapy, dental, and end-of-life costs.

The table below shows common illnesses and injuries your dog or cat may experience—and what you’d pay without pet insurance over the pet’s lifetime, according to Healthy Paws:

Condition	Potential vet costs (🐶)	Potential vet costs (🐱)
Skin conditions	$4,150	$1,700
Ear infections	$12,950	$3,100
Cancer	$21,650	$11,650
Eye conditions	$7,650	$4,075
Heart conditions	$18,000	$7,600
Stomach issues	$29,100	$24,400
Urinary tract infection	$9,100	$12,600

In addition, CCL injuries are common for dogs and can cost $12,975 over their lifetime. Cats are more prone to diabetes ($9,600) and kidney conditions ($14,750).

Looking at the potential veterinary costs you can incur, pet insurance is worth it for most pet parents. Sure, you could adopt a pet who stays healthy their whole life, but it’s always a gamble—and knowing you have pet insurance to cover any issues your fur baby develops is reassuring.

Eric Kirste

CFP®

As a pet owner, I always recommend that potential pet owners look at their finances before adopting or purchasing a pet. They are a long-term financial commitment, and just like any living being, medical needs come up, as well as accidents. Using the above table, could you reasonably afford $4,000 to $29,000 in extra costs for large medical needs? If you can’t but can reasonably afford ongoing and extra care for pets, look into pet insurance. Insurance covers routine and large medical costs. However, be sure to consider the breed and any exclusions in the policies. 

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How does pet insurance work?

Unlike with human health insurance, with pet insurance, you’ll generally:

• Take your pet to the vet.
• Pay the vet at the time of the visit.
• Submit the bill to your insurance.
• Get reimbursed for whatever portion of the bill is covered.

That means you must pay in full out of pocket at the time of the visit.

A few pet insurance companies pay the vet directly. These are often more expensive, but if you’re worried about not being able to pay at the time of the visit, this pet insurance can be worth it.

So how does pet insurance work? The three basic elements to be aware of when considering coverage for your pet are the deductible, reimbursement rate, and annual limit.

Deductible

You must pay this amount during a coverage period (typically a year) before any reimbursement from the pet insurance company begins. The lower the deductible, the higher your monthly premium. Common deductible amounts range from as little as $250 to as much as $1,000 a year.

Reimbursement rate

This is the percentage of the vet bill your pet insurance company will pay once you meet your deductible. Typical reimbursement rates are 70%, 80%, and 90%. The lower the reimbursement rate, the more affordable the pet insurance.

Annual limit

Pet insurance companies also let you choose an annual limit. They’ll pay up to a certain amount each year. Common annual limits are anywhere from $2,000 to $10,000, but some companies’ coverage limits exceed $20,000—and many offer an unlimited benefit option.

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What types of pet insurance are available?

When selecting a pet insurance policy, you’ll have two main options:

• Accident-only
• Accident and illness

As the name implies, accident-only insurance only covers injuries caused by accidents. If you want to cover illnesses—from cancer and ear infections to bloat and kidney disease—you need to opt for the more expensive accident and illness policy.

Tip

Pet insurance policies typically have a waiting period for accidents and illnesses. This is the period that must pass after initiating a policy before coverage kicks in.

You may also be able to opt in to additional types of pet insurance coverage, including a wellness plan or pet insurance that covers prescription food.

Should I get pet insurance?

The table below can help you decide whether pet insurance is worth it for you and your four-legged friend:

Consider pet insurance if…	Reconsider pet insurance if…
You would struggle to pay for emergency vet care for your pet	You have a sizable emergency fund
You just adopted a young dog or cat	Your pet is old, and rates will be too high
Your dog or cat is likely to be prone to certain illnesses or injuries	Your pet has a number of pre-existing conditions

Consider pet insurance if…

• You would struggle to pay for emergency vet care for your pet: If there is a scenario where you would take on high-interest debt to get your pet the care they need or skip the vet altogether, you should consider pet insurance. Your pet deserves proper care in emergencies; pet insurance is a manageable monthly cost you can budget for so those unexpected emergency costs don’t ruin your financial well-being.
• You just adopted a young dog or cat: Prices for pet insurance are much lower for young animals. Now is a terrific time to start a policy: Not only will costs be down, but your pet has not likely yet developed any health conditions. Waiting to get coverage until after a chronic condition develops can mean treatment for that condition won’t be covered.
• Your dog or cat is prone to certain illnesses or injuries: Research your pet’s breed to understand what illnesses are common. Large dogs, for instance, are more at risk for canine bloat. Buying coverage is wise if your pet’s breed is a higher risk. Injury is more likely if you have a playful or curious dog or cat—and you may want coverage just in case.

Reconsider pet insurance if…

• You have a sizable emergency fund: If you have significant savings, you may not need pet insurance. Skip the monthly premium and instead add more money to your emergency fund. Just be prepared to drain your savings if your pet develops an expensive issue to treat, such as cancer.
• Your pet is old, and rates will be too high: If you’ve rescued a senior pet, good for you! However, pet insurance for older dogs and cats can be expensive. You might be better off saving the money and focusing on providing the best quality of life you can for your pet in their remaining years.
• Your pet has a number of pre-existing conditions: If your pet has already developed major chronic conditions, pet insurance won’t help you cover them. You may want to skip the premiums and instead use that money to pay for the medicine and treatment your pet needs.

How to get pet insurance

Here’s how to start coverage for your dog or cat:

1. Research several companies: You have many options when it comes to pet insurance. Start your search with our roundup of the best pet insurance companies. Get quotes from at least three companies that seem best suited to your and your pet’s needs. Make sure you’re looking at similar policies (same deductible, reimbursement rate, and annual limit) for a fair comparison.
2. Input your information: When getting a quote, you’ll need to input basic information, including where you live, your dog’s age and breed, and any pre-existing conditions. Once you decide to move forward with a specific plan, you’ll also need to put in your billing details.
3. Submit your pet’s veterinary records: Many pet insurance companies require access to your pet’s veterinary records when starting a policy. You’ll need to coordinate this between the company and your vet.
4. Pay your first premium: Once you have the green light, pay the initial premium to start the policy. You’ll want to do this as soon as possible because a waiting period is likely associated with accidents and illnesses. The sooner you start the policy, the sooner your pet is fully covered!