First published: March 2023
Author: Dr Meredith Crowhurst BA/BSc(hon), BVSc(hon), PhD
Should I get pet insurance?
As vets, legally we cannot recommend a particular pet insurance product. I also don’t necessarily want to declare that every pet owner should take out pet insurance. There are pros and cons and what is right for one pet may not be the best fit for another. However, I can provide advice from a vet’s perspective as well as point you in the direction of reliable information to help you decide if pet insurance, and if a particular product, is right for you. I can also verify that for those owners that find the right pet insurance product, it really does take the worry out of finances and allows them to focus purely on seeking the best veterinary care.
Many owners, especially new pet parents, are frequently surprised just how much veterinary care costs. “On average, annual vet expenses are estimated to cost about $400 for dogs and around $270 for cats – and that’s before you factor in medications, surgery and emergency treatment.”
Choice
Vet bills are inherently expensive. Many owners, especially new pet parents, are frequently surprised just how much veterinary care costs. It costs a lot to run a veterinary practice (wages, medications, rent, equipment costs, lab fees, waste disposal, practice management fees…); massive invoices that flood in every month! Veterinary fees need to cover such large expenses. There is no Medicare for pets. Thus, the veterinary industry is 100% a user pays system.
Note, most clinics actually do try to deliver the vaccination products (on top of a consult fee) and neuter surgeries at significantly discounted prices, which should give you an indication of just how expensive things are for the vet clinics themselves!
A veterinarian’s perspective on pet insurance
To be clear, most pet insurance products do not cover routine preventative care, like vaccinations, desexing, and worm and flea products. Pet insurance is designed to mitigate the bill shock of unplanned illness and accidents.
During veterinary visits, when it comes to unexpected veterinary care, we encounter all types of financial situations. Many owners in Australia are without pet insurance but most have or find the funds when needed. Some savvy owners even regularly put money aside into an emergency fund for unexpected pet expenses. However, we do occasionally still encounter some unpleasant situations – those where we find owners have given up their own basic needs, like food, to put their pets’ needs first. And occasionally situations where an animal is euthanised because the cost of diagnosis and treatment is too much. We never want this outcome.
Thankfully, with time, we are encountering more and more owners with pet insurance, and with good insurance. For those with the right insurance product, we find it gives everyone peace-of-mind. When owners are confident in their pet insurance product and are assured that the financial aspect is taken care of, they are more likely to proceed with our veterinary recommendations. This means we can provide the most appropriate diagnostics and treatment first up, which is better for the pet.
Note: Us knowing you have pet insurance makes absolutely NO difference to the prices or recommendations vets provide. We have no idea how much your insurance will give you back and we have known many situations where the owner got nothing back at all. Our recommendations are always based on what is needed by and is best for your pet, and the prices are standard, as set by the clinic.
Whilst we do encounter owners happy with their pet insurance, we also encounter others who are not. There are those who don’t bother claiming because their excess makes smaller claims less viable. Others have found they got little back. And others had their claims rejected outright. Whilst I don’t know the individual circumstances in all cases, I do know a few. I have seen legitimate rejections because the insurance policy was taken out after the pet was diagnosed for the condition being claimed. However, I also remember one insurer who rejected a claim because it involved the same body system; The dog had had demodex mites as a puppy (a completely curable condition) but when it developed a skin mass as an adult (a completely unrelated condition), the claim was rejected because they claimed it had a predisposing skin condition. CHOICE claims that the pet insurance industry has cleaned up its act a lot in the last few years in respect to rejections and that those type of things are now less likely to occur.
The specifics of pet insurance – the devil is in the detail
In deciding whether or not to get pet insurance and which product to get, you really do need to look at ALL the fine details. Compared to a few years ago, there are now more insurance underwriters that have entered the market (Hollard, Petplan/Petcover, RACQ, Trupanion, Guild, Knose, and Budget Direct). This means there is much more competition and many more products to choose from. There are numerous different choices to be made, not only between insurance products but within each insurance product. To compare the details of all the different products, I recommend visiting the Canstar comparison website. Here you can select and compare all the different options to work out how they affect premiums.
To compare individual pet insurance products – their inclusions, exclusions, and premiums, I recommend going to the comparison website Canstar.
CANSTAR – PET INSURANCE COMPARISON SITE
What are these details you need to look at?
Each insurance product has multiple variables and choices you can make that affect the premiums you pay. Look at your individual pet’s breed, age, and general health. Compare the premiums against the possible veterinary bills you might encounter. For each individual pet, you need to decide if it is worth it. It is very important that you read the Product Disclosure Statement (PDS) and any terms and conditions carefully before making any decision.
The main variables that affect premiums are:
1. Insurance category: Accident only, accident and illness, or comprehensive, from cheapest to most expensive.
- Accident-only pet insurance covers accidents and emergencies only. Examples include being hit by a car, a dog fight at the park, trauma-related broken bones, foreign body ingestion, and poisoning. It generally includes veterinary expenses related to sudden trauma or physical injuries.
- Accident and illness pet insurance covers accidents and emergencies but also general illness. This category is the most common type of insurance, covering most medical conditions. Examples include ear and eye infections, urinary tract infections, vomiting and diarrhoea, and chronic conditions like arthritis, thyroid, liver, and kidney disease.
- Comprehensive pet insurance covers accident, emergencies, and illness but also includes preventative medicine (vaccinations, neutering, and flea and worm products).
*Before selecting any insurance product, check the fine print in the Product Disclosure Statement to clarify exactly what veterinary expenses are and are not covered.*
2. Total insurance cover – total annual benefit amount
The different insurance products give you the options of selecting different annual limits. How much total annual cover do you need?
Veterinary bills do add up quickly. A simple ear infection can set you back $300-400 with repeat visits, tests, and medications to clear the infection. A comprehensive blood test might cost close to $300, a basic set of xrays $250, and surgeries from $900-$4000. Medications are from $35 for a standard pain-relief or antibiotic injection, but many medications cost significantly more. For example, snake anti-venom alone is $900 per vial and some dogs need 2 vials. The 6-weekly anti-itch injection, Cytopoint, will set you back around $200. Chronic medical conditions, like persistent skin allergies, can require numerous visits and medications throughout the year. Those bills quickly add up.
The above estimates refer to general practice clinics. Emergency and specialist centres, providing 24-hour care and specialist services, and therefore with correspondingly higher running cost, can cost you far more. The first 24-hours of any emergency care can be from $1500-2000. A CT scan will cost from $3000. A few days of snake bite intensive care will quickly set you back $10,000-$20,000.
So how much do you need? If only we had a crystal ball. If your pet is a small breed dog, older animal, accident-prone, or a breed predisposed to particular chronic medical conditions, you might want to consider higher annual cover.
3. Excess – an amount you pay per year per condition before getting any money back
To reduce your premiums, most insurance products give you the option of selecting an excess. This maybe $100, $200, $300 or more that you will need to pay towards the veterinary bill per year per condition before the insurance company will pay out any reimbursement on the claim. You will need to compare how much each excess option reduces your premium to see if it is worthwhile. In practice, we find that excesses mean that an owner is less likely to claim for smaller veterinary bills throughout the year. For example, an owner may determine that with a $200 excess on a $250 vet bill for an ear infection, where only 60% of the remaining fee is paid out, claiming the remaining $50 is just not worthwhile. This makes the insurance mainly useful for animals with higher veterinary expenses throughout the year.
4. Percentage back – the amount you can get back on each claim
Again, to reduce premiums, most insurance products give you the option of selecting different percentages you can claim back, usually from 60-100%. This means that after any excess you pay, you can then get 60-100% back on the remaining amount. The majority offer 80% back. On the Canstar comparison website, play with the different settings to determine how much changing the percentage back affects the premiums you’ll need to pay to decide what is right for you.
5. Limits and sub-limits – restrictions on how much you can get back on particular conditions
Even if the insurance product offers a certain percentage back, you still need to look at the Product Disclosure Statement to see if there are any limits or sub-limits on particular services or conditions. For example, some products place a limit on the amount you can claim in consult fees per year. Some products place limits on the amount you can claim back for knee surgery (cruciate ligament surgery), dental surgery, and tick paralysis. If you have a large-breed dog or live in northern Australia, you might want to check you have good coverage for cruciate ligament injury surgery and tick paralysis. Check the fine details of all insurance products!
6. Exclusions – vaccinations, preventative care, desexing, dentals usually not covered
Most insurance products do not cover preventative care – such as vaccinations, desexing, and parasite prevention. For $100-200 extra per year, some products will include some cover for these. Unfortunately, much like in the human field, teeth are overlooked by most insurance companies. Dental disease is so common. Almost all dogs will need some form of dental surgery in their lives – that’s just the reality – and dental surgery can range from $1000-2500. Despite this, most pet insurance products will not cover dental expenses. This is so disappointing as prophylactic cleaning (with an ultrasonic scaler under general anaesthetic) would go a long way to reducing the amount of severe dental disease and suffering in pets.
7. Breed affects premiums significantly!!!
Breed very much affects premiums. In fact, in first selecting a pet, if you want to know which breeds are susceptible to higher veterinary bills, compare the insurance premiums for each breed. A veterinarian can also give you a pretty clear indication of which breed they would and would not own based on the medical conditions they might or, in some cases, are almost guaranteed to get! Boston Terriers rank first on the highest premium list due to the myriad of complex medical condition they are susceptible to. Small breed dogs usually have higher premiums than larger breed dogs. And brachycephalic (squashed face) breeds have higher premiums compared to other dogs. You just can’t escape genetics! With Cavalier King Charles Spaniels for example, as they get older, we ask not if they have a heart murmur but how big is the murmur? Even my English Cocker Spaniel, Nelly, developed and died from immune-mediated haemolytic anaemia, where her body destroyed her own blood cells. If you look at the textbook predisposing factors, it says: 6-year-old female cocker spaniel. This was her, 100%, no joke. For cats, many older cats develop chronic kidney disease, hyperthyroidism, diabetes, and cancer. Ask your vet what conditions your specific pet may be prone to.
8. Age affects premiums and the level of cover you can get
Once a dog hits 8 years of age, the number of insurance options greatly diminishes. In fact, if you are adopting an older animal, getting pet insurance can be next to impossible, especially if you cannot verify an exact age and if you cannot provide any previous medical history. As your pet ages, the premiums increase. And over the age of 8, there are much fewer product options and greatly diminished cover. With increasing age, most products offer less percentage back on claims and have more restrictions, with added exclusions and reduced payment limits and sub-limits. Even if you have had the pet insurance since the animal was young, the pet insurance companies have no obligation to continue the same premiums or level of cover as the animal ages. Each year, check your renewal statement to see if your cover has changed and make a new assessment if continued insurance is still worthwhile.
9. Pre-existing conditions – VERY IMPORTANT TO NOTE!!!
Almost all insurance companies will not cover pre-existing chronic conditions. READ THIS – IT IS IMPORTANT!!! If you plan to take out insurance the minute after leaving the veterinary consultation, with the aim of getting cover for a condition discovered during the visit, you WILL NOT BE COVERED. Not uncommonly, an owner will ask us to falsify the medical record to exclude or alter information so they can be covered by insurance. Legally we cannot do that. If you want insurance coverage, you MUST TAKE OUT INSURANCE COVERAGE WELL PRIOR TO THE VETERINARY VISIT. Also, be aware of any waiting period that might apply when claiming on certain conditions. Even if you take out insurance the minute prior to a veterinary visit, you will most likely not be covered. Hence, since medical conditions pop up unpredictably, this means if you want to insure your new puppy, take out the insurance early. Taking out pet insurance at the time your pet gets sick is not an effective method of covering the unexpected veterinary expenses you are faced with in that moment.
READ THIS – IT IS IMPORTANT!!! If you plan to take out insurance the minute after leaving the veterinary consultation, with the aim of getting cover for a condition discovered during the visit, you WILL NOT BE COVERED. Not uncommonly, an owner will ask us to falsify the medical record to exclude or alter information so they can be covered by insurance. Legally we cannot do that. If you want insurance coverage, you MUST TAKE OUT INSURANCE COVERAGE WELL PRIOR TO THE VETERINARY VISIT.
Note, there is some good news. Previously, if your pet had a particular illness in the past, that illness might have been excluded from cover (see my skin example mentioned previously). However, most insurance products will now cover conditions if the past condition was fully cured previously and the animal has been symptom-free for a set period of time, and as long as the new health issue is not related or caused by the first condition. Examples include bouts of vomiting or diarrhoea that are completely unrelated, and the development of skin lumps that have no relation to previous ones. Note that chronic re-occurring chronic conditions, such as skin allergies, are still not covered if the insurance product was taken out after the first occurrence.
So, how much does pet insurance cost?
The below tables were taken from the following article, which compared the various insurance premiums in mid 2021: How Much Does Pet Insurance Cost? | Canstar. According to the article, the premiums ranged heavily depending on the size of dog and the breed being insured. “We found that a German Shepherd might cost $1,171 to insure annually on an accident, illness and routine care policy, but a Rottweiler German Shepherd cross could cost an average of $1,744.” The tables give you a rough idea of what you might expect to pay (or as the average premiums were in mid 2021).
| Type of animal | Annual cost of accident and illness |
|---|---|
| Cat | $634 |
| Small dog | $1,358 |
| Medium dog | $1,250 |
| Large dog | $1,246 |
| Type of animal | Annual cost of accident, illness and routine care |
|---|---|
| Cat | $716 |
| Small dog | $1,479 |
| Medium dog | $1,375 |
| Large dog | $1,380 |
Conclusion
Whether or not pet insurance and which product is best for you will depend on your specific pet (breed, age, size, medical conditions) and circumstances. If planning on purchasing pet insurance, we recommend getting it whilst your pet is still very young, before it develops any condition that might restrict the cover. Or if you have an older pet, take out cover well before they develop any illness to ensure they are covered without restrictions. Look very carefully at every fine detail in the Product Disclosure Statement and Terms and Conditions. My other big piece of advice is to ask other pet owners – ask who they are with, what parameters they selected, how they are finding it, and if they find it worthwhile. Overall, I can say that for those owners that have an insurance product that they are very happy with, it really does take the