Should you buy pet insurance?

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Should you buy pet insurance?
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Are you thinking about getting a pet insurance policy? Read this before you do…

Pet insurance review: Cost, coverages and more

Pet insurance is a controversial topic among pet owners. Some people love it, while others think it’s a waste of money. The truth is probably somewhere in between.

Here’s what to consider if you’re thinking of buying a policy. First of all, let’s take a look at the two most popular options out there.

Pet insurance guide: Table of contents

Banfield: Optimum Wellness Plans

Banfield Pet Insurance Optimum Wellness Plans

Banfield pet insurance is one of the more popular policies out there. You may know Banfield as the in-store vet offices found at PetSmart stores.

Banfield offers a range of Optimum Wellness Plans that it’s quick to say are not insurance.

Traditional insurance is something you use when you have a medical need. But with Optimum Wellness Plans, the focus is instead on preventive care basics with unlimited office visits and other services to monitor, maintain and improve your pet’s health.

Here’s what you get with an Optimum Wellness Plan for a dog:

  • Comprehensive physical exam (2x/year)
  • Routinely recommended vaccines
  • Early screening for serious illnesses
  • Discounts on most other Banfield products & services
  • Unlimited office visits

Below is a quote for a sample plan that we shopped online for a 5-year old mixed breed dog weighing 80 lbs.

banfield dog insurance
Banfield

When it comes to cats, there are three flavors of Optimum Wellness Plans available with each offering progressively more services.

Essential Wellness, the entry-level wellness plan, offers the following:

  • Comprehensive physical exam (2x/year)
  • Vaccinations
  • Diagnostic testing
  • Fecal exams (2x)
  • Deworming treatments (2x)
  • Unlimited office visits

Getting a quote for a wellness plan for a cat online is considerably more difficult than it is for a dog.

You can’t just plug in your cat’s age, breed and weight to get a quote, like you can with a dog. Instead, you’re advised to fill out a form online and wait for Banfield to contact you to discuss options.

Veterinary Pet Insurance

veterinary pet insurance VPI logo

Veterinary Pet Insurance (VPI), a Nationwide Insurance company, is a popular pet insurance option.

Like Banfield’s Optimum Wellness Plans, VPI has a Pet Wellness plan that covers basics like wellness exams & tests, flea/heartworm prevention and vaccinations.

But unlike Banfield, VPI also has plans that are true pet insurance in the traditional sense. These plans include the limited Major Medical plan and the robust Whole Pet with Wellness.

Major Medical offers:

  • Exams, lab tests, X-rays
  • Prescriptions
  • Surgeries & hospitalization
  • Chronic conditions
  • Some hereditary conditions (waiting period applies)

Whole Pet with Wellness offers:

  • Exams, lab tests, X-rays
  • Prescriptions
  • Surgeries & hospitalization
  • Chronic conditions
  • Hereditary conditions (no waiting period)
  • Wellness exams & tests, flea/heartworm prevention and vaccinations
  • And more

Team Clark newsletter editor Chelsea uses VPI for her family’s two dogs — a Dachshund and a Yorkie — and has been pleased so far.

dogs

“I’ll admit the idea of paying for health insurance on our two dogs seemed a bit overboard at first,” Chelsea says. “It wasn’t until we had to pay more than $3,000 for our dachshund’s back surgery that I was thankful we had the insurance.”

The bill for that back surgery came out to $3,166. When Chelsea submitted it for reimbursement, VPI paid back $2,536 of it. So she only paid a net out-of-pocket of $630 on that operation.

Chelsea’s monthly premiums are $42/month ($512/annually), so even factoring in that, she still benefited from having VPI. Of course, your results may vary.

If there’s one thing Chelsea’s learned from the experience of having VPI, it’s this:

“Had we waited until our dachshund started showing signs of back problems before buying this insurance, the plan would have likely excluded any coverage related to her spine. My advice is, if you have a breed known to have specific medical issues, get the insurance when they are young and in good health.”

Clark’s take on pet insurance

If you’re going to buy pet insurance, money expert Clark Howard recommends that you talk with your vet before purchasing a policy. You want to make sure you’re getting the best coverage that you can afford with the least amount of loopholes.

“Otherwise it often doesn’t make sense when you consider the typical coverages versus the exclusions,” the consumer champ says.

Clark says to pay special attention to breed exclusions in particular. If you don’t read the policy closely, you’re liable to pay for coverage that you can’t use because your animal’s breed is blacklisted.

Clark’s preferred alternative to pet insurance: A pet emergency fund

two dogs

An alternative to traditional pet insurance that Clark has long recommended is to set up a pet emergency fund.

The idea is simple. You just put what you would pay for pet insurance into a savings account for future use.

Remember our Team Clark newsletter editor Chelsea? She took Clark’s advice and did this.

“We started a savings account for our two dogs,” Chelsea says. “Knowing we have money set aside keeps us from panicking and dipping into our own emergency fund when there’s a large, unexpected bill.”

Chelsea says she and her husband contribute to the pet savings account just like they do their own — but they have a set goal amount for the pet emergency fund.

Once they hit their goal, they stopped putting money aside and simply maintain the goal amount by replenishing any funds they have to withdraw for veterinary services.

You can see more of Team Clark’s favorite ways to save money on pets here.

Consumer Reports: Keep these pointers in mind if purchasing a policy

Consumer Reports has long said pet insurance is rarely worth the price. However, it may be beneficial if your pet is older and requires veterinary care several times a year.

But if you’re going to buy, be sure to heed the following advice:

Read the fine print.  Know the limitations, cost-sharing and service fees. What are your deductibles? What are your co-pays? Select coverage with simple, percentage-based payouts. Skip the stuff that relies on judgments of what’s ‘reasonable.’

Know the exclusions. Chronic diseases generally aren’t covered, and insurers often won’t pay for known defects among certain breeds. And, of course, no insurer covers pre-existing conditions. Watch out for a maximum limit on treatment for individual illnesses, too.

Skip the riders. Wellness care riders, as just one example, are deemed “generally not worth the price” by Consumer Reports magazine.

Take the highest deductible that makes sense. As with all insurance, a higher deductible will usually result in lower premiums for you.

Watch out for premium increases. Pet insurers raise rates based on the age of your pet, veterinary cost inflation and the types of treatment that are potentially available for an illness.

Final thought

Pet insurance offers peace of mind, but you’ve got to be sure you’re getting the value out of what you pay for it.

In many cases, you could be better off just paying yourself into a pet emergency fund, stashing the money in a high-yield interest bearing account with an online bank. This is particularly true if your pet is young and healthy.

More pet stories you might enjoy on Clark.com

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