You've just received an unexpectedly large veterinary bill, or maybe an animal has somehow found its way into your life. To ensure your pet's health, you need to budget for its care. Pet insurance is one of the shrewdest investments you can make.

Pets are so loyal and so low-maintenance that it's easy to forget how fragile and mortal even the strongest pets can be. Just ask the conscientious Rottweiler owner who walks her dog daily, feeds him the right food, treats him with care and kindness, and wakes up one day to find a sluggish 8-year-old companion whom subsequent tests detect is suffering from cancer. She's now faced with the prospect of amputating his leg before the cancer spreads to more vital parts of his body. It's an awful proposal to consider.

Invest in a Wellness Plan
A wellness plan – which is really just a frequent-buyer program – saves money on the treatments a conscientious pet owner would buy anyway. There's a nominal sign-up fee, then $20-25 monthly premium (depending on whether your pet is a dog or a cat, and whether it's older than six months when you enroll it.) For that you get discounted examinations, blood tests, a break on regular vaccinations and teeth cleanings that are almost worth the price of the plan on their own. The literature also boasts "unlimited" visits, which hopefully no pet owners abuse.

The largest privately owned veterinary practice in the United States operates inside one of the two largest pet store chains, and offers various types of wellness plans. It's billed as the archetypal ounce of prevention. After all, it's far better to bring your seemingly healthy pet in for a series of scheduled routine checkups than to wait for something frightening and frighteningly expensive to happen.

Veterinary Clinics Enjoy Profits
At this point the skeptical consumer asks, "What's in it for them?" Veterinary clinics don't stay in business by giving their services away. Even with pet wellness plans, they aren't. The clinics are still enjoying a healthy markup, and using the power of volume to earn themselves what will presumably be patients-for-life. A $25 payment, even in a month when your pet has no reason to visit the vet, is still probably going to be cheaper in the long run than an unplanned visit to a different vet.

Of course, some individual pets are healthier than others. Some breeds are predisposed to conditions that different breeds aren't. Bulldogs are susceptible to breathing problems and infections, while older domestic shorthairs succumb relatively often to chronic renal failure. That's why wellness plan providers offer plans at increased premiums for mature dogs and cats. The result is similar care for a higher price, which stems from two economic truths. First, older dogs and cats are close to death. Because such pets have shorter lifespans, the wellness plan providers have less time in which to make their money.

The Bottom Line
There's a difference between a wellness plan as outlined above and actual pet insurance, with deductibles and everything. The latter service is offered by formally designated insurance brokers. One major underwriter brands its insurance with the name of America's most famous non-profit organization devoted to animal welfare. A competitor bills itself as the only national company offering comprehensive pet health insurance. For prices similar to what the wellness plan providers offer, this insurer offers the following:

  • 90% bill coverage, beyond exam fees
  • Unlimited payouts
  • Preventative and therapeutic nutrition
  • No extra charges for chronic conditions.

You can find these plans through various independent clinics, or go the other way around and contact the insurer to find out which clinics it does business with.

Related Articles
  1. Budgeting

    How To Save Money When Moving

    Moving doesn't have to be as expensive as you think. Here are some great ways to save money on moving costs.
  2. Budgeting

    The Hard Way We Pay For Convenience

    Convenience is a luxury. However, any cost-conscious individual should be aware of these ridiculous ways we pay for convenience and how to avoid them.
  3. Budgeting

    How to Cost Effectively Spend on Baby Clothes

    Don't let your baby's wardrobe derail your budget. These top tips help you to save money and spend wisely on baby clothes.
  4. Investing

    Soul Cycle vs. Planet Fitness

    How has the fitness industry's shift from multipurpose health clubs to specialized studios and budget gyms played out for SoulCycle and Planet Fitness?
  5. Retirement

    How to Decide Where to Live in Retirement

    Here's a guide to help you decide where you want to live after retirement.
  6. Personal Finance

    College Students are Failing Financial Literacy

    Financial trends among college students are a cause for concern, prompting a renewed emphasis on financial literacy.
  7. Personal Finance

    5 (Mostly) Costly Exotic Pets You Can Legally Own

    Exotic pets can be fascinating to look at, but most are expensive to acquire and maintain. And avoid being bitten, especially if you get a scorpion.
  8. Insurance

    Explaining Indemnity Insurance

    Indemnity insurance is an insurance policy that protects business owners and employees from losses due to failure to deliver expected services.
  9. Budgeting

    6 Cost-Effective Tips for Raising Your First Child

    The excitement of welcoming your first child to your family shouldn't prevent you from making good cost-effective decisions.
  10. Budgeting

    5 Ways to Date on a Budget

    Dating on a budget doesn't have to be boring. Try these 5 tips to find the best dates on a budget.
  1. How does a bank determine what my discretionary income is when making a loan decision?

    Discretionary income is the money left over from your gross income each month after taking out taxes and paying for necessities. ... Read Full Answer >>
  2. Can I buy insurance to reduce unlimited liability in a partnership?

    Partnership insurance is actually quite common. Most of the time, partners buy insurance to safeguard against the possibility ... Read Full Answer >>
  3. What is the range of deductibles offered with various health insurance plans?

    A wide range of possible deductibles are available with health insurance plans, starting as low as a few hundred dollars ... Read Full Answer >>
  4. How do I know how much of my income should be discretionary?

    While there is no hard rule for how much of a person's income should be discretionary, Inc. magazine points out that it would ... Read Full Answer >>
  5. What proportion of my income should I put into my demand deposit account?

    Generally speaking, aim to keep between two months and six months worth of your fixed expenses in your demand deposit accounts. ... Read Full Answer >>
  6. How do I use the rule of 72 to estimate compounding periods?

    The rule of 72 is best used to estimate compounding periods that are factors of two (2, 4, 12, 200 and so on). This is because ... Read Full Answer >>

You May Also Like

Hot Definitions
  1. Section 1231 Property

    A tax term relating to depreciable business property that has been held for over a year. Section 1231 property includes buildings, ...
  2. Term Deposit

    A deposit held at a financial institution that has a fixed term, and guarantees return of principal.
  3. Zero-Sum Game

    A situation in which one person’s gain is equivalent to another’s loss, so that the net change in wealth or benefit is zero. ...
  4. Capitalization Rate

    The rate of return on a real estate investment property based on the income that the property is expected to generate.
  5. Gross Profit

    A company's total revenue (equivalent to total sales) minus the cost of goods sold. Gross profit is the profit a company ...
  6. Revenue

    The amount of money that a company actually receives during a specific period, including discounts and deductions for returned ...
Trading Center
You are using adblocking software

Want access to all of Investopedia? Add us to your “whitelist”
so you'll never miss a feature!