Pet Insurance Guide

Pet insurance can help defray expenses if your four-legged friend has a medical emergency. See more pet pictures.

­Pet insurance may seem like a fairly new concept, but it's been around for quite awhile. In 1982, Veterinary Pet Insurance (VPI) issued the first insurance policy to a pet in the United­ States. That pet just happened to be Lassie, the most famous canine television star in the world [source: Embrace Pet Insurance]. More than 25 years later, the popularity of pet insurance has skyrocketed.

Pet insurance may seem like an unne­cessary expense to most pet owners, but the American Veterinary Medical Association reports that Americans alone spent more than $24.5 billion on pet health care in 2006 [source: AVMA]. That raises the question: How much could you afford to spend if your pet had a medical emergency?

As veterinary science continues to advance, procedures and equipment that haven't always been accessible to veterinarians are becoming more readily available. As a result, veterinary bills continue to rise. In fact, some new procedures cost more than $5,000 [source: Weston].

If you're considering pet insurance, you may want to consider this: The average monthly cost of insuring a dog, one of the more expensive pets to insure, is $28. That's roughly $336 a year. In 2006, the cost of veterinary care in American households for all pets averaged $366 [source: AVMA].

­It's important to understand that paying for the insurance won't cover all of your veterinary expenses. You still have to pay deduct­ibles and co-pays, and you'll have to limit how much your policy will pay out yearly, but it may not cost much more than you're already spending annually. In the event of a major emergency, it could save you thousands.

If you're the type of person who would go into debt to save your pet's life, pet insurance might be a better alternative to the poorhouse. There are a number of companies that offer affordable policies to suit your specific pet. We'll learn about those, and more, on the next page.