Is Pet Insurance Worth It? Compare Premiums From 5 Popular Insurers

The love of your pet is priceless, but veterinarian visits are not. Here’s what you need to know about pet insurance.
Last updated May 26, 2020 | By Matt Miczulski
Woman walking two beagles

FinanceBuzz is reader-supported. We may receive compensation from the products and services mentioned in this story, but the opinions are the author's own. Compensation may impact where offers appear. We have not included all available products or offers. Learn more about how we make money and our editorial policies.

At least one good thing has emerged amid the coronavirus pandemic and the ensuing financial worries many people are facing — pet adoptions are way up. According to NBC News, shelters across the U.S. are emptying as more and more people step up to foster and adopt dogs and cats as they’re forced to shelter at home.

As wonderful as that may be, let’s face it: being a pet parent is expensive. According to American Pet Products Association (APPA) estimates, pet owners will spend $30.2 billion on vet care in 2020, an increase from $29.3 billion last year. Add the costs of food (and treats, of course) and grooming services, and you can see how quickly it adds up.

As the cost of vet bills continues to rise, you might be wondering: is pet insurance worth it? My wife and I recently had to bring our 7-pound Yorkiepoo to the vet, and we walked away with a nearly $800 bill. I was wondering the same thing, so I did some research.

Here’s what you need to know about pet insurance policies.

Jump To

How does pet insurance work?

Similar to human health insurance, pet insurance pays for a portion of your pet’s veterinary care if they’re ill or injured. With most plans, you pay the vet bills for your furry friend upfront and then get reimbursed by your pet insurance provider. Usually, you can visit any licensed veterinarian for treatment, though some providers may have a network you need to stick with.

Although you can find pet insurance for birds and exotic pets, pet insurance is most common for dogs and cats.

What does pet insurance cover?

Pet insurance plans will likely vary from company to company, and there are 17 major pet insurance companies in North America that are members of the North American Pet Health Insurance Association (NAPHIA). Some insurers may offer one level of wellness coverage for your pet; others may offer different levels of coverage tailored to your pet’s needs.

That being said, there are typically three main types of pet insurance coverage:

  • Accident and illness: Comprehensive coverage that reimburses for vet costs for unexpected injuries, sickness, and disease.
  • Accident only: Reimburses for costs associated with treating accident-related medical care.
  • Wellness: Sometimes called routine or preventative care, wellness coverage may include reimbursement for checkups, vaccinations, tests, and dental work.

Depending on the plan, you may also find some additional benefits. This can include things such as emergency vet treatment if you’re traveling with your pet internationally, liability coverage if your dog bites someone, and even the cost of advertising a reward for a lost or stolen pet. But again, these additional benefits vary from plan to plan.

What is not covered by pet insurance?

Things that are not covered by pet insurance can also vary from one company to another. As you’re comparing pet insurance policies from different insurers, make sure to familiarize yourself with what is not covered.

Although this list is not exhaustive, here are some things that tend to not be covered by pet insurance:

  • Preexisting conditions: Pet insurance will likely only pay toward health issues that arise after the policy has been put in place, not health problems that existed prior to having coverage.
  • Pregnancy and/or birth: Pet insurance likely won’t cover anything that has to do with your pet’s pregnancy.
  • The purchase price of your pet if it dies: According to NAPHIA, most insurance policies won’t cover the death of your pet after nine years of age.

How much does pet insurance cost?

Just as the cost of health insurance for people depends on a number of factors, so too does pet health insurance. This can include factors such as where you live, your pet’s breed, its gender, and its age. Where you live actually plays a bigger role in your premiums than you may think. For example, the costs of running a veterinary practice tend to be more expensive in urban areas, which means the average cost for services will likely be higher. As a result, your insurance will likely charge higher premiums as well.

In addition to paying premiums to maintain coverage, you may also have to pay a deductible and a copay or coinsurance. The deductible is the amount you would pay yearly before the insurance company starts reimbursing you. A copay or coinsurance is an amount of money you would pay out of pocket toward a covered claim after you’ve met your deductible. According to NAPHIA, the most commonly offered copay amount is 80%, which is also the amount most people choose. This means you are reimbursed for up to 80% of the amount on your claim after you’ve met your deductible.

To give you a better idea of the cost of pet insurance, I pulled some quotes for a dog and a cat from a number of different providers. For the quotes for a dog, I used my dog’s breed (Yorkipoo), male, and gave him the age of three for a baseline (he’s eight). I also used my South Florida zip code. For the quotes for a cat, I used a domestic shorthair breed, male, age three. For each pet insurance company, I chose the highest level of coverage they offer.

Pet insurance company Embrace Figo Healthy Paws Nationwide PetFirst
Plan Comprehensive Ultimate Comprehensive Whole pet with wellness Additional coverage
Wellness included? No No No Yes No
Monthly premium for cat $27.19 $27.19 $37.60 $34.76 $8.44
Monthly premium for dog $38.99 $55.38 $52.40 $69.52 $21.10
Reimbursement 90% 80% 80% 90% 100%
Annual deductible $200 $250 $200 $250 $2,500
Annual reimbursement limit $30,000 Unlimited Unlimited Unlimited $10,000

As you can see, prices vary greatly from one company to another. And each provider offers different levels of coverage, which is why it’s important to shop around.

How to get pet health insurance

The process of purchasing pet insurance is actually typically fast and easy. Most pet insurance companies allow you to obtain quotes and purchase a policy online in just a matter of minutes.

In general, you need to enter the basic information about your pet to first obtain a pet insurance quote: its name, type of animal (dog or cat), breed, age, your zip code, and your email address. After selecting the plan based on the insurance coverage you need, you will likely have to provide some additional information. This can include more detailed information such as whether your pet is spayed/neutered, if your pet has had an exam in the past year, and any health conditions your pet has or had. After that, you should be able to purchase coverage. With some pet insurance policies, there’s a waiting period. Often, policies won’t go into effect until 14 days from when your application is approved, so keep that in mind throughout the process.

It’s best to obtain quotes from the different pet insurance providers you’re considering in order to narrow down which companies seem right for you and your pet. You’ll want to compare what is and isn’t covered across insurance plans, as well as cost. It doesn’t hurt to check reviews either to get an idea of customer sentiment. When looking at prices, don’t just look at your monthly premium. Also factor in the deductible and reimbursement limits.

FAQs about pet insurance

What is the best pet insurance?

The best pet health insurance likely depends on which one provides the coverage your furry friend needs at the most affordable price. You should, however, do your due diligence in researching any pet insurance companies you’re thinking of taking out a policy with. You may want to consider other factors in addition to affordability, such as customer service and whether the insurance company is financially stable.

What does pet insurance actually cover?

The types of things that are covered by pet insurance will likely vary from company to company and can range from wellness exams, vaccinations, and ear infections to hospitalization, surgeries, and more serious procedures such as cancer treatment. The best way to determine you have the coverage you need for your pet is to shop around and compare providers.

How many pet owners have insurance?

According to the North American Pet Health Insurance Association, there were 2.16 million pets insured in the U.S. at year-end 2018. Furthermore, the 2017-2018 APPA National Pet Owners Survey estimates there were 183.9 million pet dogs and cats. So we can deduce from these numbers that approximately 1.17% of pets were insured in 2018. The 2017-2018 APPA National Pet Owners Survey also tells us there were 84.6 million households with a pet. Therefore, roughly 989,820 pet owners have pet insurance.

Does every vet accept pet insurance?

Pet insurance usually works by reimbursing you for the costs of covered treatment. Therefore, it typically doesn’t matter what licensed veterinarian you visit. Most often, you submit your vet bills and get reimbursed accordingly.

When should I get pet insurance?

Pet insurance typically won’t provide coverage for preexisting conditions. Many also require that your pet has visited a vet in the last 12 months prior to purchasing coverage. In other words, you can’t wait until something happens to decide you want pet health insurance. If pet insurance is something you feel you need, it’s best not to wait.

Is pet insurance worth it? The bottom line

We pay for insurance for what might happen and hope that we will never need it. But if we are indeed on track to spend $30.2 billion on vet bills in 2020, a $50 monthly premium might start sounding a lot more appealing.

To determine whether pet insurance is worth it, weigh the cost of insuring your pet against your ability to pay for your pet’s treatment. Do you have enough in your emergency fund to cover a hefty vet bill? Will a monthly premium help relieve some financial stress instead of having to pay the full cost of a trip to the animal hospital? Can you fit a pet insurance premium into your budget? These are all questions you should ask yourself.

While there’s no guarantee you’ll need it, pet insurance might provide some savings if your pet requires medical treatment. At the very least, it will give you some peace of mind.