Doing the Math: Pet Insurance vs. Savings Accounts

Increasingly dog owners are choosing to buy pet insurance.  Is it a good idea?  As with any insurance, you are paying to join a risk pool that will help you cover unexpected costs you may not otherwise be able to comfortably handle.  It comes down to simply doing the math:  pet insurance vs. savings accounts.  First, you will want to get an idea of what the veterinary bill might be for a mishap.  Yes, the odds are you won’t have  such a mishap (especially if you have insurance.)  But, if you do, what are the options?  Pets Best Insurance walks us through some typical scenarios.

Doing the Math:  Pet Insurance vs. Savings Accounts

Can You Save Fast Enough?

Financial advisors sometimes recommend savings accounts instead of pet health insurance. They argue that you can put a little away each month in anticipation of future vet bills. In theory, that sounds okay. But what if your “future” vet bill comes next week, or even a year from now? Will your savings account hold enough to cover it?

Even if you’re putting around $20 into the account each month, (which is more than the approximate cost of apet insuranceplan, monthly) basic math exposes the real weaknesses of pet health savings accounts. If your pet gets sick or injured two months in, you’ll only have around $40 at your disposal.

Pets Best Insurance plans start at about $16 per month, so we’ll use that number to start.

• If a pet owner puts $16 into a savings account every month, it will take about 13 years to reach $2,500, the maximum per-incident benefit of our Pets Basic plan.

• If a pet owner puts $25 into a savings account every month, it will take about 23 years to reach $7,000, the maximum per-incident benefit of our Pets First plan (which runs about $25 per month).

In either case, it would take more than three years to save just $1,000. And in many markets, that may not be enough to cover the most basic accident or illness.

Common Veterinary Care Costs
Depending on your pet’s accident or illness and where you live, even the most routine procedures can costs thousands of dollars.

• Treating a broken leg can cost $2,000 – $5,000.
• Surgically removing ingested items such as rocks, sticks or toys can cost $1,000 – $3,000.
• Cancer treatments can cost $2,000 – $10,000, depending on the type of cancer, severity, and the treatment plan chosen.

Don’t Forget About Freak Accidents
A recent promotion on the Pets Best Insurance Facebook page revealed all sorts of pet “freak accidents” pet owners hadn’t planned for, emotionally or financially. Some of the most common unexpected accidents that required vet care included:

• Small pets being dropped, stepped on or injured by their owners or other pets
• Cats swallowing string and sewing needles
• Dogs swallowing party favors, human foods and kitchen utensils
• Dogs breaking glass and getting cut – sliding doors, fish bowls and light fixtures
• Pets injuring themselves during ordinary activities like jumping off a porch step or running in the yard
• Pets being electrocuted by lightening or peeing on electrical boxes