Best Value Pet Insurance

Looking for the best value pet insurance is a must these days, with budgets being tight.  However, best value is not the same as cheapest.  Read this article, and find out why going for the cheapest policy is not always the smartest decision.

Best value = best return on your investment. 

In the equation above, your investment is the cost of your monthly insurance premiums.  The return is how much you get back from your insurance company. 

Let’s say you buy the cheapest policy and pay $15 per month for a year.  Your beloved Chihuahua then swallows a rubber ball and your vet tells you that it will cost $800 to remove the object. 

The terms of your cheap policy indicate that you must first cover a $500 deductible and then you will be reimbursed for 70% of the remaining vet bill.   Thus, you are reimbursed $210  (800 less 500 deductible times 70 percent.)

So you have paid out $180 in premiums and received back $210.  A return on investment (ROI) of about 16%.  Not too bad. 

However, assume that you opted for a higher level of coverage that cost $25 per month.  This policy has a $200 annual deductible and covers 80% of vet bills.

Your insurer would reimburse you $480 for the same vet bill (800 less 200 times 80 percent.)

Your investment of $300 (one year’s cost of insurance) would have returned $480 – a ROI of 60%.

In this case, the more expensive policy provided you with a better return on your investment and therefore was a better value. 

So the lesson here is that cheaper is not always better.

Another example:

You buy the cheapest policy and your cat, Miss Tinkle, needs a vet visit.  The visit will be $100, and then the antibiotics and overnight stay will be $500. That is a total of $600. Your deductible is only $50, however, only the medication and vet visit are covered – the overnight stay is out of your own pocket and it costs $400. So you just paid $450 to get your policy to cover $200. This just cost you a bundle.

So in addition to running the numbers, you need to carefully read the terms of your policy to understand what is covered and what is not. Going for the cheapest does not mean it is a good value, it just means you pay less up front.  Focus on the big picture.

Now that you have read this article, you know know that going for the cheapest insurance is not always the best idea.  Focus on getting  the best value pet insurance and you will save yourself a lot of hassle, time, and money.