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Is Pet Insurance a Scam?

By Amy DeYoung

Updated Jan 19, 2023

By Amy DeYoung

Updated Jan 19, 2023

Home > Pet Insurance > Is Pet Insurance a Scam?

Veterinary care can be costly, with the average cost of emergency or unexpected veterinary care for cats and dogs falling between $800 and $1,500. On top of that, only 39% of Americans have enough savings to cover a sudden $1,000 emergency without borrowing or selling something. Unfortunately, this puts many pet owners at risk if their beloved furry friend needs sudden medical treatment.

As a result of this reality, many Americans consider whether or not pet health insurance is a good choice for protecting their pet’s health and finances. But is pet insurance a scam, or is paying the monthly insurance premiums worth it?

cut dog being held at a vet clinic while papers are being signed — Image Source: Canva

Is Pet Insurance a Scam?

For years, many financial advisors warned against pet insurance because there was little competition among the few pet insurance providers, allowing them to charge less competitively and offer poorer reimbursements.

However, today the percentage of vets’ bills reimbursed is usually between 70% to 90%, which often includes developed, expensive health conditions like cancer, cruciate ligaments, and even vet-recommended euthanasia. In the past, pet insurance may have been more of a “scam,” but today, it’s often worthwhile, especially as veterinary treatments continue to improve. While veterinary care improvements are wonderful, this also means an increased cost to provide our pets with excellent medical care, so we must carefully plan for these expenses.

Is Pet Insurance Worth It?

Pet insurance is usually worth it for many pet owners and their pets. Consider the following questions when determining whether pet insurance is worth it for you and your pet:

Can I cover the cost of emergency medical care for my pet out of pocket? Remember, emergency medical care can easily cost thousands of dollars. Do you have an emergency fund or dedicated pet savings account that can cover these expenses?
Does the peace of mind that a pet insurance policy provides me reduce my stress about potential future health catastrophes? While you may not always get every dollar back in payouts, the peace of mind you receive knowing that you have a pet insurance policy in place in case your pet has a huge medical emergency may be well worth it. Remember, most of us don’t purchase insurance in hopes that we’ll actually need to use it. For example, think about your homeowners insurance. You probably don’t want to be in a situation where you need to file an expensive claim after a tornado destroys your home, but it can give you peace of mind knowing it’s there.
Does your pet already have pre-existing conditions? No pet insurance company will cover pre-existing conditions unless they’re completely curable in rare cases, such as an ear infection. If your pet already has a lot of pre-existing conditions and is at the tail end of its life, it may not be worth purchasing pet insurance. Instead, consider it for your other pets or future pets.
Do you understand the fine print, exclusions, and annual limit on the pet health care insurance plan you’re considering purchasing? Read through all the details of the pet insurance plan carefully and take special care to look at the exclusions and fine print, which may discuss expensive conditions that are excluded or changes in your policy as your pet ages. For example, some pet insurance companies may decrease the annual limit and increase your monthly premium as your pet ages due to the risk of increased health problems.
How far are you willing to go to pay for your pet’s medical expenses? This question is a challenging one. Some of us would be willing to pay anything to save our pet’s life, whether $5,000 or $20,000. For others, if the costs were too high, they would opt for euthanasia or surrender their pet. If you’re in the former group where you would pay anything to treat your pet, pet insurance is probably a worthwhile investment.

In addition to these considerations, look into wellness plans or preventative care pet insurance plans which cover routine pet care costs like regular checkups, vaccines, and even neutering and spaying. We also recommend looking for a policy with simple percentage-based reimbursement rates rather than reimbursements based on what is “reasonable” for your pet’s health situation.

couple looking at papers with their dog — Image Source: Canva

Final Thoughts

Pet insurance is a personal decision for a pet owner. Depending on your financial situation, paying for your pet’s medical bills out-of-pocket as you go may be an option. However, for most pet owners, a sudden $1,000 or more medical bill would be challenging to cover without relying on credit cards or going into debt. As a result, the cost of pet insurance every month is likely a good investment in your pet’s health and a financial safety net for yourself. Before enrolling your pet in an insurance policy, read through all the fine print and spend some time studying deductibles, exclusions, and more. Shopping around for different policies can save you a lot of money and help you find a plan matching your priorities.

Other Pet Insurance Resources

Is Pet Insurance a Scam?

Is Pet Insurance a Scam?

Is Pet Insurance Worth It?

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