Pet owners love to spend money on their pets! But what happens when their dog is hit by a car or their cat needs emergency surgery? Advances in medical care for pets have made miracles possible, but they also come with a price. What are your options to help with these unexpected pet costs? Serious illnesses and traumatic injuries can take their toll on your pet’s health as well as your pocketbook. Unexpected healthcare costs can also lead to heart-wrenching decisions. For more than two decades, pet insurance has been an option for some pet owners, but pet savings plans and even credit for pets are now more common. Which idea will work best for you?
Between the United States and Canada, pet owners will spend more than $45 billion on toys, foods, accessories and healthcare for their four-legged family members. But, despite this love for our pets, a single traumatic event or serious disease can devastate personal finances or potentially lead to heart-wrenching decisions. Fortunately, the availability of pet insurance, pet health savings plans and even credit for pets may help some pet owners keep their pets around longer. The problem…consumer advocates don’t think it’s a good plan.
Pet insurance is not a brand new idea and actually has been around for more than 25 years. In almost every case, pet insurance works as a reimbursement insurance. This means that you, the pet owner, pay the veterinarian for the services and then submit a claim to the company. After deductibles are applied, the insurance company will send out a check based on the type of plan you purchased for your pet. Although you won’t get 100% of your money back, it can help to ease the financial burden in the event of serious disease or injury.
But some consumer advocate groups don’t agree. Consumer Reports® has stated that insurance is only beneficial if something catastrophic happens to your pet. They recommend placing your premium payments into a savings account instead. Saving just $30 per month (a typical premium for pet insurance) in an account that generates 5% interest will create $6,000 over the lifetime of the pet, according to their calculations.
And, veterinarians, as a whole, have not been overly receptive of pet insurance. Many fear becoming part of a managed care system and some fear being disappointed by the insurance company. Dr. Thomas Beall of Iowa feels strongly about helping pet owners plan for unexpected events. His website, www.PetVetPro.com, encourages owners to set up a pet health savings plan. Beall says that packages on his site will help. “This will be set up for them as a automatic withdrawal and will help “weak willed” savers. Just like is done for retirement plans. If you don’t see the money, you don’t miss it.”
Jack Stephens, founder of Pets Best Pet Insurance has a different view of savings plans. He says, “Medical problems don’t wait until you have saved enough and then stay within the savings you have accumulated.” He further describes the story of Abby, a young lab mix puppy who needed more than $7,000 worth of veterinary care. Pets Best paid about 80% of the total bills even though less than $100 of premiums had been paid. “If they had a pet savings account, they would have had $30-60”, says Stephens. It is quite possible that Abby could have been put to sleep if her owners had not opted for pet insurance.
With less than 1% of American pet owners and only about 9% of Canadian owners utilizing any sort of pet insurance or savings plan, what other options are available? Most veterinarians cannot offer any sort of billing plan and many owners have their cash and credit cards tied up with other purchases. Fortunately, for some pet owners, CareCredit (www.carecredit.com) may be a solution. CareCredit offers several flexible payment options that allow clients to make payments over a period of several months. But, like other lines of credit, interest rates can skyrocket if the balance is not paid within a specified time frame.
The advances in veterinary medicine over the past few decades have been absolutely amazing. Our pets are living longer due to the skills and dedication of their veterinarians. But, there are costs associated with the life-saving skills and high-tech equipment. If your pet suffers a traumatic injury or serious illness, make sure that you understand the costs as well as the procedures. Talk with your veterinarian about the options that are available to you and, above all, be proactive in planning for your pet’s healthcare. Visit www.MyVNN.com to learn more about how unexpected pet health costs can affect you.