What's changed in recent years is the state of veterinary science, as well as the economics of running a veterinary practice. Vets today can offer treatments that were unheard of just a few years ago -- and at prices that could make you howl. Consider:
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Treatments once reserved for humans, from radiation therapy to kidney transplants, are currently available for pets. That means once-fatal conditions are now treatable at costs ranging from $1,000 to $5,000 or more.
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Vets have access to increasingly sophisticated and costly diagnostic tools such as MRIs. Such screenings not only boost the cost of exams but often detect problems that once would have gone unnoticed, and untreated.
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These expensive tools and procedures have helped create health-care inflation in the pet doctor world.
That inflation has helped fuel a significant rise in the pet insurance industry. American Demographics magazine estimates that 5% of American pet owners have the insurance, up from less than 1% in 1995. Insurers have teamed with the American Kennel Club and Petco Animal Supplies to offer the insurance, while several major employers now provide the coverage as an optional employee benefit.
Taking out a veterinary pet insurance for your cat or dog will help you to make sure that your pet can and will be taken care of in the event of an unexpected emergency requiring treatment by a vet. Pet health insurance enables you to take an animal to the vet even when you might be in a position where you might not have sufficient funds to afford it.
You can take out a pet insurance for any kind of cat or dog, and sometimes even for other, smaller, animals such as birds, rats and hamsters.
The oldest company, Veterinary Pet Insurance, has seen its revenues climb at a 40% annual rate since 1997 -- the year it finally broke even after 15 straight years of losses, according to founder Jack Stephens. VPI, which has about 85% of the pet insurance market, had gross sales of $110 million in 2005.
Pet insurance is far from a cure-all, though:
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The policies typically have deductibles, co-pays and caps that limit how much will be paid out annually.
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Pre-existing problems and hereditary conditions, such as hip dysplasia in German shepherds and retrievers, are normally excluded.
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The older your animal, the more you'll have to shell out in premiums. Some insurers don't cover pets older than 9, while others levy a stiff surcharge.
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Industry leader Veterinary Pet Insurance offers two levels of coverage that pay 50% to 90% of covered treatment costs after a $50 deductible. Here's how the numbers work out.
Since insurance is best used as protection against catastrophic expenses -- not those you could easily pay out of pocket -- the question becomes: How deep in the hole would you go for your pet? And then could you afford to pay those costs yourself?
Pet insurance is a nonstarter for many pet owners, simply because they take a pragmatic approach to their animals. If the cost of treatment got too high, they would choose to put the animal to sleep.
"About half see the pet as disposable. If it got really ill they just wouldn't treat it," said Stephens, whose company conducted research on the issue. "The other half were willing to treat, whatever it took."
If you're in the latter category and you don't have sufficient savings to cover the treatments, you might consider pet insurance. But do your homework before you buy:
Shop around. Policies and premiums can vary widely. Note not just the monthly or annual cost but the differences in deductibles, co-pays and caps, which may limit payouts by incident, annually or the animal's lifetime. Ask whether the insurer offers discounts for insuring multiple pets. Some of the companies to check include:
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PetCare Pet Insurance, (866) 373-7387
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Petshealth Care Plan, (800) 807-6724
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Veterinary Pet Insurance, (800) 872-7387
Check with state insurance department. Like human health insurers, pet insurers should be registered with your state regulators.
Scrutinize the policy and understand the exclusions. Remember, the conditions most likely to afflict your pet are often the ones most likely to be excluded from your policy.
Beef up your savings. A Consumer Reports analysis found that pet owners with insurance may actually spend more over time on their animals than those without.
