Is Pet Insurance Worth It? Our Pros & Cons For 2022

You have insurance for your health, your car, your house — but what about your pets? Do they have pet insurance coverage?

If you don’t currently have pet insurance, you’re not alone. While more than 70% of U.S. households have pets, just 26% of those American pet parents have actually purchased insurance for their pets, according to a 2021 study from Liberty Mutual.

But given the price of vet care, it’s worth looking into. The ASPCA estimates the annual cost of routine vet visits is $225 for dogs and $160 for cats, depending on your pet’s age. Emergency vet visits can cost from $800-$2,500, and sometimes more. And if your pet develops cancer and you choose to treat it, you might spend $10,000 or more.

If you’ve ever found yourself at the animal hospital at 3 a.m. with a beloved pet in distress, you know what it’s like to be willing to shell out pretty much anything to make your pal feel better, no matter the cost. But that dedication to our pets can also lead to financial ruin, which is why pet insurance is worth the cost for many pet owners.

Lemonade insurance provider, which offers pet insurance, says that pet insurance provides peace of mind and allows the insured to save on routine care with preventative plans.

We’ve put together this breakdown to help you decide: Is pet insurance worth it for you and your pets?

How Does Pet Insurance Work?

Like with human health insurance, pet insurance providers alleviate some of the costs of keeping your pet healthy. You can choose from different levels of coverage, with each plan costing a monthly or annual premium based on how much coverage you choose.

Some plans cover basic scenarios like accidents and injuries, some only cover accidents, and others include injury, accident and illness, as well as genetic/hereditary conditions.

Accident-only coverage is the most affordable; accident and illness coverage is more expensive; and the most expensive plans include wellness care and even death-related expenses. In general, the more comprehensive the coverage, the higher you can expect the monthly premium to be.

Pro Tip

Whether or not you opt for pet insurance, start an emergency fund now for vet care to make sure you can handle unexpected out-of-pocket costs. 

Many plans have a deductible, a certain amount you must pay out of pocket before coverage kicks in. Depending on your policy, this could be anywhere from $0 to $2,500 in a plan year. Typically, higher-deductible plans will yield lower monthly premiums.

While human health insurance works on a copay basis (you pay a certain percentage when you see the doctor and the insurance covers the rest), pet insurance is largely a matter of reimbursement.

You pay the full amount due when you take your pet in for care, then submit a claim to the insurance company afterwards. Depending on your policy, they’ll pay you back anywhere from 20% to 100% of covered costs. This means you might have to put the cost of emergency vet care on a credit card temporarily, if you can’t pay out of pocket.

Rates are calculated based on your pet’s age and breed, as well as your location (vet costs are higher in some areas than others).

How Much Does Pet Insurance Cost?

While individual costs will vary based on your pet’s breed, age, health and the tier you opt for, the average cost for accident and illness dog insurance is $49.50/month (or $594/year), while the same level of pet insurance for cats is about 40% less, according to the North American Pet Health Insurance Association (NAPHIA).

Remember, pet insurance costs largely depend on the deductible you choose, the age of your pet, any preexisting conditions and the type and amount of coverage you ask for. That said, we have compiled a list of the best pet insurance companies in the U.S., factoring in cost, types of coverage offered, reimbursement speed, mobile app and website ease of use and more. Among our favorites are Trupanion, Healthy Paws, Lemonade and Figo.

Have an exotic pet (i.e. anything other than a dog or cat)? Your options are a bit more limited, but you can still find coverage. Check out Pet Assure and Nationwide for plans for birds, rabbits, reptiles and other members of the animal kingdom.

Is pet insurance worth itA dog receives cancer treatment at BluePearl Veterinary Partners in Tampa, Florida. Tina Russell / The Penny Hoarder

The 5 Pros of Pet Insurance

So is pet insurance worth it? There certainly are a lot of reasons to get your pet covered:

1. It’s Easy to Compare Options

Unlike human health insurance, which can be a labyrinth of plans and riders you need a pro to help decode, pet insurance is relatively straightforward. Policies are simple, tiers are easy to compare, and you can get a no-commitment quote from different companies within minutes, making price shopping a breeze.

2. Premiums Can Be Low for Young Pets

If your pet is young or healthy, or you choose a lower tier, you can get coverage for less than the cost of your Netflix and Hulu subscriptions. Such a low monthly premium is not a huge price to pay for the security of knowing your pet can get the help they need.

3. Deductibles Are Reasonable

Compared to the cost of one late-night animal ER visit, most plans’ deductibles are affordable. If, heaven forbid, your pet is seriously injured or ill, you could wind up paying at least the cost of the deductible anyway — but with insurance, you can get your pet the extra care and piece of mind toward vet bills that you may not have been able to afford on your own.

4. You Get to Choose Your Vet

There are no “out-of-network” provider headaches when it comes to pet insurance. As long as your vet is licensed, eligible expenses should be covered and there’s no need to worry if your vet “accepts” your plan. Since you pay for the cost out of pocket and then submit a claim to the company for reimbursement, all you need from your vet is a copy of their invoice and for them to fill out a section of the claim form (or to send along your pet’s records).

5. You Can Do More for Your Pet

According to a recent joint analysis by Nationwide and VetSuccess, owners with pet insurance are more likely to seek medical care for their pets than those without. Parents of insured dogs visit 73% more often while cat parents with insurance take their feline friends into the vet 43% more often.

No one wants to have to choose between a sick pet and a mountain of debt. Too many pet owners, faced with a catastrophic medical crisis they hadn’t prepared for, are forced to make the heartbreaking decision to elect for “economic euthanasia,” according to the University of Melbourne in Australia. If you invest in pet insurance, you could save yourself — and your pet — from ever facing such a decision.

The 4 Cons of Pet Insurance

But for some, the cons of pet insurance outweigh the pros. Here are a few of the biggest problems with pet insurance policies:

1. Premiums Can Be High for Older Pets

If your pet is older or has a pre-existing condition or you choose a high tier, you could be looking at monthly premiums of $50 or more. You’ll want to carefully weigh whether the annual cost makes sense for you. The more customized coverage you require (like if you want a specific chronic or behavior condition covered), the higher you can expect to pay.

2. You Still Have to Pay Up Front

Having pet insurance won’t save you from having to shell out big bucks if your pet needs a costly procedure. Whether you have coverage or not, it’s wise to have a separate savings fund for vet emergencies to ensure you can handle upfront charges until your claims are processed.

3. It Doesn’t Cover Everything

On average, a pet owner with insurance still pays around 20% of their pets’ medical expenses, according to a report by the New York Times. Routine wellness checkups usually aren’t covered (unless you pay extra for that), so you’ll still pay for those out of pocket. Certain hereditary/genetic conditions may also not be covered; be sure to check each policy’s specifics carefully.

4. The Coverage has Limitations

Many plans also limit the amount you can claim, either annually or over your pet’s lifetime. If your pet is unfortunate enough to suffer a major medical problem, you could max out your plan’s limit quickly and find yourself paying the difference.

5. You Could Even Spend More

If your pet only needs routine vet care, you won’t save much. And pet owners with insurance spend an average of $324 out of pocket on a dog and $264 out of pocket on a cat, according to the zoology and veterinary sciences journal, Animals, compared to $251 for an uninsured dog and $146 for an uninsured cat.

Yep, pet parents with insurance spend more on veterinary care than those without.

This is largely because, unsurprisingly, owners with pet insurance take their animals to the vet more often than those who don’t have insurance. This is a good thing, as our animals age more quickly than humans and do deserve the kind of care vets can provide. It’s just something to be aware of if you’re already struggling to pay your vet bills.

And these numbers don’t include the annual price of pet insurance premiums. With an average cost of $49.50 a month for dogs and $29.70 a month for cats, insuring your pet could mean your total costs hit $918 for a dog or $620.40 for a cat (barring catastrophic expenses of unexpected vet bills). If your pet is fortunate enough to avoid any big issues, the cost of pet health insurance could outweigh the savings.

But that’s insurance in a nutshell: Most of us will spend more on monthly premiums to cover those rare but expensive calamities, but those of us who do encounter such tragedy will be grateful for having the insurance.

A dog is held down by two vet techs while receiving cancer treatment.
Veterinary technicians comfort a dog as it receives cancer treatment at BluePearl Veterinary Partners in Tampa, Florida. Tina Russell / The Penny Hoarder

Should You Get Pet Insurance?

Like property insurance (car, home, etc.), you won’t necessarily “save” or “make” money in an average scenario, but in the event of a catastrophe, you may find it’s worth the investment.

While you may not get the most bang for your buck with a relatively healthy pet, there’s no way to predict what illnesses or injuries might occur, and for many pet owners, knowing they have a safety net in place is value enough. And because pre existing conditions generally aren’t covered, it’s wise to start your pet insurance policy when your pet is young and healthy, meaning the first few years you can certainly expect to spend more than you save.

“Pet insurance can help offset routine medical expenses and can be especially helpful for the unknown. Keeping the coverage may give you the freedom to make medical decisions for your beloved pets based on quality of life, not finances,” Dr. Jennifer Welser, former chief medical officer of BluePearl Veterinary partners in Tampa, Florida and now with Mars Veterinary Health in Vancouver, Washington, told The Penny Hoarder.

Pro Tip

To get the most benefit from pet insurance, enroll your pet when they’re young for maximum savings. 

Talk to your vet to get an idea of your pet’s potential breed-specific health problems, and ask them which insurance they’d recommend. If you decide to choose catastrophic coverage (generally the best cost-to-savings option), spring for the highest deductible you can afford.

A dog stares at the camera.
Most insurance companies will require a vet visit before you sign up for a plan.  Tina Russell/The Penny Hoarder

How to Get Pet Health Insurance

To sign up for pet health insurance, you’ll need the following information for your pet:

  • Name
  • Breed
  • Age
  • Pre-existing conditions (if any)
  • Vet’s name and contact information

Have your pet seen by a vet if you haven’t done so within the past year.

Most pet insurance providers have waiting periods, which means you can’t get coverage immediately following an accident or illness. (This ensures people don’t sign up for pet insurance plans only when they know they need to cover a big bill.) So if you think you’d be interested in pet insurance, apply now before you end up needing it.

Choosing the Best Pet Insurance Plan for Your Needs

Ready to move forward with a pet insurance policy but unsure which company to go with? We recommend getting quotes from a few top companies; our list of the best pet insurance companies is a good place to start.

While there are some niche companies on the list (Nationwide covers lizards and birds, Trupanion has lifetime deductibles and Lemonade prides itself on super-affordable premiums and its charitable giving), we find that any of the insurers included in our list are well worth consideration.

Timothy Moore covers banking and investing for The Penny Hoarder from his home base in Cincinnati. He covers a variety of other topics, including pets, insurance, taxes, retirement and budgeting and has worked in the field since 2012. Reporting from contributors Kelly Gurnett and Olivia Snow Smith is included in this report. 

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