Pet Insurance vs Savings: Which is Right for You?

We’re comparing pet insurance vs savings to see which comes out on top, when and why. We know that when it comes to making financial decisions you want to make sure you’re putting your money to the best use. So when pet insurance comes up, the first question is: is it worth it?

Many pet parents wonder if they’ll ever end up using their pet insurance. This leads them to wondering whether it may be better to put away a bit of money every month in case of emergency.

After all, Fido or Felix is really healthy. Surely they don’t need more than routine vet visits – so how necessary is an entire insurance policy really? Well, it can easily be more necessary than you think… read below.

The pet insurance vs savings debate

Back in 2019 the Australian Finance Review estimated that only around 7% of Australian pets had insurance. In our consumer research a year later we found 23% of pet owners had insured their cat or dog. The take-up is rising, and for good reason, but many people still think pet insurance is too expensive for them.

How much does it really cost?

If you’re looking for detail, then our How Expensive Is Pet Insurance piece will you an an in depth comparison to show you how much pet care cover will likely cost. But in summary, depending on your type of pet, their breed, their age and your choice of plan, you may pay less than $1 a day.

The benefits of pet insurance

As pet parents, we’ve got to be prepared to pay for the routine costs that come with having a furkid. The decision to choose pet insurance is usually made to prepare for unexpected costs involving illness, injury and third party damage, especially large unexpected costs. 

The big win here for pet insurance over savings is that when you need to choose a treatment for your pet in need, you’re not focused on the prices but rather getting your pet the best care.

Tips to keep in mind

Here are some key factors to take into consideration when looking at pet insurance:

1. Fully understand what your pet insurance covers

The extent of inclusions and exclusions depends on the pet care plan you choose. Make sure you understand exactly what is and isn’t covered – check the product disclosure statement to find out. 

2. Know how pet insurance works

Like a Medicare claim, you need to pay the bill/s for treatment then submit your claim afterwards. Once the paperwork is done, you’ll be reimbursed up to your defined benefit limit minus an excess payment.

3. Be aware of your breed’s risk factors

Different breeds are prone to different diseases and illnesses (check out our dog health problems by breed article). Knowing exactly what you may have to deal with in your furball’s lifetime will help you choose the right pet insurance plan, for you and for them.

4. Understand how age factors in

The cost of taking care of pets usually increases with age. As our furbabies grow older, they are more likely to become ill and have injuries. The earlier you insure them the broader your insurance coverage will likely be over their lifetime because they’ll have no (or fewer) pre-existing conditions prior to taking up insurance. Insurance providers don’t cover pre-existing conditions. Also note that insurance providers will stop access to their comprehensive coverage plans if your pet is a senior before you take out insurance.

5. Weight up budget with need

Can you afford to pay for comprehensive coverage or do you need to take a step back to suit your budget? There will be cheaper options than the insurance provider’s premium plan if need be. For example, you might consider an accident-only plan or the plan in between the two as the perfect compromise. While fewer incidents will be covered and your annual benefit limit will be lower, you’re paying a lower monthly fee.

6. Know that pet insurance gives peace of mind

While you’re paying for the insurance provider’s financial assistance with your vet bills and medical emergencies, the real win is that it provides peace of mind. Whether your pet has zero accidents, or three in the same week, you’ll never have to worry about not being able to give your furbabies the treatment they need. No need to worry about the “what if’s”.

Can a savings account give you the same?

Now let’s move over to the other side of the argument in our pet insurance vs savings debate.

By this we mean opening a savings account you put money into instead of paying for pet insurance. This is our first point in itself because you want to keep this money separate rather than dipping into it over time. Which would be tempting, right?

The idea is, if your pet insurance premium would be $30 per month, you instead put $30 into your savings account each month. Then you can tap into this in case of emergencies.

The main win here is that when it’s your money you’ve saved, there’s nothing that “isn’t covered”. You can decide where and how to spend it. Unfortunately this may mean tomorrow because you can never predict when your pet will get ill or injured. But we digress…

Here are some of the most common pet visits to the vet in 2022 and the costs involved.

Costs for vet visits

While your average vet visit won’t set you back very much, here’s a list of some vet procedures and their costs (courtesy of Petcloud).

• Flea or tick prevention, or deworming from $50
• Teeth cleaning $300 – $400
• Gastrointestinal obstructions $1,000 – $2,000
• Limb fractures $1,000 – $2,000
• Brachycephalic Airway Corrective surgery $2,500+ 

Top pet insurance claims

And, according to Finder, below are the most common pet insurance claims from 2019 and their average prices:

• Tick paralysis $1,156.87 (this is why a tick treatment regime is key)
• Gastroenteritis $1,319.65 (read: does your dog have gastroenteritis)
• Pneumonia $1,610.57
• Bone fractures $2,066.31
• Snake bite $2,133.31 (read: snake bites and pets)

Some of these numbers are quite scary, especially if more than one incident happens in close succession.

If you’ve been putting money away for a significant amount of time you might be fine. But if you’re planning on starting today, keep in mind that a $1,000 vet bill would take 33 months of saving $30 to cover it. And don’t just take our word for it, here’s a bunch of stories of the trouble furbabies have found themselves in.  

Tips to keep in mind

As above, so below; here’s what you should take into consideration when looking at using a savings account over pet insurance.

1. Do what works for you. In months where you have a little extra money or fewer expenses, it’s a good idea to put a bit more into your pet care savings account. Maybe putting money in weekly works better for you. Take a moment to come up with a strategy – the main takeaway’s to stay consistent.
2. Your money, your choice. Perhaps the most common reasoning behind opening a savings account is that no matter what happens, everything is covered when you have direct access to your money. (As long as you have enough savings to afford the bills, of course.)
3. Compare vet prices in your neighbourhood. Knowing where to go in case of an emergency can save you a lot of money. It’s too late to be comparing vet prices if your furbaby is in pain. Put some time aside to check prices of the vets in your area, and for after hours emergency clinics too. This way you’ll be prepared when it’s needed. 
4. The peace of mind may be unlimited or it may not. Accidents and illnesses are typically unpredictable. There may be many incident-free months, which will be a wonderful feeling as you see your savings grow. There also may be incidents happening one after the other so you’d better save fast to err on the side of caution.
5. Saving money is never a bad thing! Just like the vet clinic point above, knowing where to cost-effectively buy your furball’s food, toys and everything else can save you money. You could even put these savings into the pet care account. As the old saying goes, rather have and not need than need and not have. 

Pet insurance vs savings: It’s pet insurance!

When choosing pet insurance, we recommend you start early. Why? It means you won’t have exclusions for any pre-existing conditions your pet has already developed. This means you’ll have more coverage for your furkid and peace of mind from the beginning of their life. 

Have a look at the PD Insurance dog insurance and cat insurance plans and get a free quote today. We also include third party liability damage cover, for damage your dog does to other peoples’ property and pets (if there’s no history of aggression).

Why not take two minutes now?