This image is from Huxley. This is our brand new Labrador puppy. Today my wife and our two sons are going to take him on his first walk.
Cost seems to have become a fairly regular conversation in our household ever since we first considered getting a dog. There is the animal itself, then the cage, the basket, the collars and leashes, the food, the vaccines and the oh so many toys. (Note to self: buy stock in Pets at Home).
And then there’s pet insurance. Now I argue that we should self-insure Huxley, setting aside money each month for medical treatment if we need it. My wife says we should just pay the insurance like most people do just in case something bad happens.
My reasoning is that pet insurers make a lot of money on policies. Huxley is a purebred dog from a terrific breeder, so if we set aside the amount that insurers would charge us, we will have some money when he needs treatment. And from what I hear from other dog owners, he will need treatment. In the end, however, we should have saved more than the cost of the treatments.
So far, so good. But then you have to consider what happens if there is a medical emergency and he needs extremely expensive surgery. How much would that surgery cost for us to wave Huxley to that big kennel in the sky?
The average cost of pet insurance for a Labrador is £245 per year, according to Compare the Market. The quote we got is £35 per month. Over ten years we could accumulate at least £4,500, although in reality I would try to increase the premium each year to match what an insurer would charge. The Association of British Insurers says there are 7.7 million pet policies. Every year, insurers collect £2billion in premiums and pay around £800million in claims.
Insurers, of course, are very good at warning you of the worst-case scenario – like the run over cat who needed surgery costing £5,000 to reattach two toes, and a terrier with a lung disorder, his care costing £40,000 over a decade. But many policies have caps on what you can claim in a year or for one condition, and recurring health issues are often excluded.
Make a claim and suddenly your premium skyrockets. All I hear from pet owners is the exorbitant cost of pet insurance and the frustration of exclusions.
I told a friend my plan, and she pointed out what she thought was the obvious flaw. “Are you really going to tell your boys the dog was put down because you wouldn’t pay £5,000 to get him better?”
Yes, in all honesty, I think I could.
We have a lot of insurance: health, life, buildings and contents, car and travel. I wouldn’t bother to self-insure, largely because what you’re paying for is the security of knowing you’re covered in the unlikely event of a catastrophic claim – like being involved in a terrible car accident, flooding of your house, or having a heart attack while on vacation in the United States.
Sure, you wouldn’t value your own life, but you can do that with a pet, right?
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