A few years ago, my sister ran into a truly awful situation. She had to face the music that part her family might pass way. One of her cats was going in and out of the doctor’s office using every medical procedure possible to keep her cat alive. The bills piled up, and inevitably her cat died.
I remember one year during open enrollment time that I saw a new benefit on the docket called Pet Insurance. I actually chuckled at first thinking was this some gimmick or trick for the insurance companies to make more money? Quite the contrary to my surprise as Americans spent $20 billion on veterinary bills in 2010 — an 8.5% increase from a year earlier and more than double the amount spent just a decade ago. (source: wsj.com) Owning a pet is a serious financial decision these days because beyond your pet’s regular care, you need to consider the best way to plan for medical bills.
If you take dogs, for example, the average monthly premium can run $20 to $40 per month. Just like other insurances you may have purchased in the past, the younger your dog is the cheaper the rates will be for you. When deciding how much you want to spend on the insurance, there will be many of the same considerations you take into hand just as buying regular health insurance.
Catastrophic coverage or major dog insurance is what you want to have in the event of serious accidents and unpredictable conditions. With this policy, there is a low monthly payment but a very high deductible. Comprehensive policies are affiliated with this type of coverage. It is a combination of routine coverage and catastrophic coverage. The deductibles for this type of policy usually begin at $500. (source: bestpestinsurance.com)
Wellness and Routine coverage applies to all normal procedures that dogs need to stay healthy. This includes standard care such as teeth cleaning, annual checkups, and vaccinations. This type of dog insurance offers the most economical coverage. (source: bestpetinsurance.com)
Chronic Condition coverage helps dog owners when their pets develop such long-term conditions as diabetes or osteoarthritis. The coverage amount depends on the insurer, and the insurance firm may even place limits on the payout amounts. (source: bestpetinsurance.com)
Genetic Condition coverage is only provided through a few, dog insurance firms. It is extremely expensive, and it covers a broad spectrum of genetic conditions that may affect dogs. (source; bestpetinsurance.com)
Like any insurance coverage you purchase, I would check first to see if your company offers such a program during the open enrollment period. If your company does not offer a program than look at the same considerations as you do with your health insurance including stability of carrier, deductibles, co-payments, emergency visits, and total coverage. I think given the rising costs of caring for the wellness of your pet, this type of insurance could be a smart money move in 2011!
Ted Jenkin, CFP®, AAMS®, AWMA®, CRPC®, CMFC®, CRPS®
Co-CEO and Founder oXYGen Financial, Inc.
Phone 1.800.355.9318 or 770.777.0427
oXYGen Financial, Inc. co-CEO Ted Jenkin is one of the foremost knowledgeable professionals in giving financial advice and Smart Money Moves to the X and Y Generation.
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