Does it pay to have pet insurance?

Every pet owner is well aware of just how expensive vet bills can be and with no Medicare or similar scheme in place for pets, owners can find themselves unable to afford (or, at least, shocked at) the cost of expensive treatment.

Pet insurance can cover the cost of vet fees for treating illness or injury to your fur baby. Most vets recommend that owners take out pet insurance as they’ve witnessed first-hand when treatable animals have to be put down because their owners can’t afford the vet bills. But it’s not for everyone. Have a look at the pros and cons of pet insurance, and whether it's worth it in the long run for your furry friend.

PROS CONS
You’re spoilt for choice.
The huge variety of options available, ranging from the level of cover to the extras that are included, gives you plenty of scope to choose the best policy for your pet’s needs without breaking the bank.
Older pets can be hard to insure.
It’s best to insure your pets earlier rather than later because most insurers stipulate a maximum age for a new policy (usually nine years). Another benefit is that you’re less likely to have claims refused on the basis of pre-existing conditions.
Routine check-ups are often covered.
Many policies include up to $300 cover annually for regular visits to the vet. This means you can get dependable value for your premiums, instead of gambling your money on the possibility that something more serious may happen.
Exclusions will always apply.
Any pre-existing conditions your pet might have suffered from prior to being insured is unlikely to be covered. The fine print varies from policy to policy, so be sure to check the product disclosure statement (PDS), but the definition often extends to any condition your pet has ever been treated for.
You could save thousands.
A serious illness or injury can take a huge chunk out of your budget if you do not have pet insurance. Cruciate ligament damage, for example, is the most common reason why a dog may develop a lame hind leg, and the surgery for this can cost up to $8,500.
There are limits to how much you can claim.
Ask your vet to estimate the costs of future treatments you may be liable for. Knowing the medical history of your pet, they will be able to give you an informed opinion about whether the claim limits and sub-limits on your policy will realistically cover your expenses.
Your pet will be in good hands if you’re unwell.
Many policies include cover for emergency boarding if you are hospitalised and there is nobody to look after your pet.
You’ll probably have to pay up front.
Although some vets agree to defer payment until your claim is finalised, it’s more common that you will have to settle the full account up front. You may be required to provide evidence about the cause of your pet’s condition, and this can also delay reimbursement.

What you should look for when comparing policies

When you’re doing a comparison of pet insurance policies, make sure to compare the following features:

  • Cooling-off period. How long do you have from the policy commencement date to make sure that you are happy with the features of your policy? A longer cooling-off period gives you more time to change your mind about cover should you need to.
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  • The maximum age accepted for new applications. Some policies will not cover your pet once it reaches a certain age.
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  • Renewal of policy. Check whether your policy can be set up to be automatically renewed every year. This saves you the hassle of taking out a new policy every year, but remember that you’ll have to continue paying premiums to maintain cover.
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  • What is covered under the policy. You’ll need to read product disclosure statements closely to determine the exact level of coverage offered. Does one policy offer cover for a wider range of illness, injuries and treatments than another? Weigh up the pros and cons of each level of cover.
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  • What is excluded. Just like any other form of insurance, a pet insurance policy will contain a list of exclusions. These will include pre-existing conditions, illnesses which your pet can be vaccinated for, and circumstances where you have not acted reasonably to safeguard your pet’s health. Check out the list of exclusions on each policy to make sure you know exactly when cover will and will not apply.
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  • Excesses typically range from $0-500, so this can obviously have a big impact on the effectiveness and affordability of your policy. Knowing how much you will have to pay when you make a claim can save you from a nasty surprise in the future.
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  • The percentage of vet bills that will be covered. This generally ranges between 65% - 80%. It’s crucial to understand what you are liable to pay so you can assess if the veterinary treatment is affordable to you. Even if the policy appears to cover 100% of some costs, check the terms and conditions of your policy to check if the age or breed of your pet means that you are required to pay additional cover.
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  • Policy flexibility. Keep an eye out for a range of flexible options that can help you tailor a policy to your needs. Does a policy offer flexible premium repayment options, such as the ability to pay weekly or perhaps monthly? What about when you want to cancel your policy — do you have to pay a fee or jump through any other hoops to do so? How easy is it to lodge a claim and how quickly are claims processed?
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  • Other features. A range of other features you should look out for include the minimum and maximum age at which your pet can take out cover, the percentage of your vet bills that can be paid, as well as whether or not a tick paralysis benefit is provided. You can also check whether hereditary conditions are covered, how the reimbursement amount is determined, whether any limits or caps apply, and whether the policy limit is calculated on a per-claim or per-year basis.