Pet Insurance - How It Can Help in a Pet Emergency

Pet Insurance - How It Can Help in a Pet Emergency

In the Australian market this is a question which is also becoming more relevant as the costs of veterinary treatment increase, especially in pet emergency settings.

For this reason alone pet insurance is becoming essential for owners without deep pockets and may be the difference between being able to accept or decline life-saving treatment at your local 24 hour vet.

For any pet lover who has gathered with their like-minded friends at the local dog park, there are stories of both elation and tragedy with veterinary treatment (especially when dealing with a pet emergency at the local 24 hour vet), and the same stories when discussion turns to insurance. But we all know that a sample size of one is hardly representative of the market. So, if pet insurance companies are indeed there to make a profit, and by implication we all therefore pay more than we receive in return, is pet insurance really worth it?

In discussing this proposition there are two salient points. The first whether we are indeed paying more than we receive, and the second is what we receive in return for our premiums.

On the first point there have recently been two major changes in the Australian pet insurance market. The first is an increase in premiums across the board, and the other has been the return of one of the two major insurance administrators to a co-payment arrangement for their policies (rather than a '100% minus excess' arrangement). A sceptic may argue that this is merely the insurance companies looking to further line their pockets, but an industry insider may astutely speculate that this is due to the fact that claims have outpaced premiums as pet owners claim in excess of the actuarial forecasts.

For anyone familiar with the industry this comes as no surprise. In socialized human healthcare the financial decision of healthcare is not a major consideration, especially in emergency situations. By contrast, somekeyword and other veterinary healthcare has been constrained by concurrent healthcare and financial decisions and the inevitable tradeoff between the two. As insurance becomes more prevalent, the financial decision is progressively being removed from the equation and owners are increasingly opting for the gold standard in veterinary health care rather than an uncomfortable compromise between their pet's wellbeing their bank account. As this trend continues veterinary healthcare will be able to offer superior treatment options for insured patients.

This brings us to the second point of what insured pet owners are receiving for their premium. Although the focus will inevitably fall on the magnitude of the annual premium, the potential return is significant. An insured animal can receive up to approximately 20 times the annual premium in accident and illness cover. But the benefits reach far beyond the financial. In a pet emergency, there is often not time to arrange finances, and costs can be significant and hastily accrued. Furthermore, the emotional impact of a serious injury or illness cannot be underestimated. These factors can create the perfect storm. In fact, it is difficult to contrive a serious veterinary emergency scenario where the perfect storm phenomenon does not occur, with the exception of either a hopeless prognosis or an owner with significant and liquid financial resources at their disposal.

For the 99% of us who live in the real work, the value of pet insurance is simple - for conditions covered by the policy, the financial headache can be set aside and owners can concentrate on the weighty decision of their pet's assessment, diagnosis and treatment - a process which can take days or even weeks. Any owner who has faced a veterinary emergency will attest to the value of this small luxury amongst the barrage of continual decisions and emotional turmoil. From a veterinary viewpoint, the presence of pet insurance has saved more than a few lives for purely financial reasons.

In summary, the value of pet insurance is in the eye of the beholder. There is significant anecdotal evidence that Australian pet insurance providers have underestimated the cost of claims by pet owners. Additionally, the peace of mind provided by pet insurance cannot be underestimated, especially when considering a visit to a 24 hour vet hospital or vet emergency centre.

Perhaps the decision is too complex to come down to yes or no... but the question will continue to be asked regardless.