Vet Bills Are Rising. Will Pet Insurance Save You Money?

While many of us would do just about anything to keep our furry friends healthy, paying for the pet care to meet that goal is a growing challenge. According to the Bureau of Labor Statistics, veterinary services in urban areas increased in cost by 6.1% between June 2024 to June 2025. That's more than double the inflation rate for all goods and services over the period.

Pet insurance helps with rising vet bills, by covering at least part of your pet's medical expenses for a monthly premium. Whether it saves you money depends on your pet’s age, health, and care needs. For many owners, the value lies in financial protection against unexpected emergencies.

Read on to learn whether pet insurance can save you money in the face of rising vet bills, and given the pros and cons of getting a policy.

How does pet insurance work?

Pet insurance works by reimbursing you for qualifying non-routine medical expenses. What's covered depends in part on the type of policy you buy and the customizations you choose.

Policy types

Most pet insurance companies offer two major types of policies: accident-only, and accident and illness.

Accident-only policies: These cover injuries like cuts, broken bones and swallowed objects.

Accident and illness policies: The most popular option, these cover illnesses like cancer, diabetes and allergies, in addition to accidents.

Coverage customizations

When you buy pet insurance, you can generally customize three aspects of it: the size of the deductible, the proportion of reimbursement and the limit, if any, on the total coverage.

Deductible: This is the amount you pay out-of-pocket every year before your pet insurance kicks in. The higher your deductible, the lower your annual premium. Options for the deductible generally range from $100 to $1,000. Deductibles generally reset every year, but a handful of policies offer lifetime deductibles.

Reimbursement: Your reimbursement level is the percentage of your vet bill that the insurer covers, after you meet your deductible. The less you opt to have reimbursed, the lower your premium will be. Most insurers offer 70–90% reimbursement, with 80% being the most common. Some policies may offer lower or, less commonly, full reimbursement.

Coverage limit: A policy's coverage limit is the maximum your policy will pay out, usually within a year. Providers offer a wide range of coverage limits, but you'll find that most coverage limits range from $2,500 to $20,000. Many providers offer an unlimited coverage option, though premiums for these plans are typically higher. Some insurers also impose lifetime limits on care or set caps for treatment of specific conditions over a pet's lifetime.

What does pet insurance exclude?

While the expenses pet insurance won't cover vary by provider, a few exclusions are nearly universal for all policies.

Preventive care: Routine pet care costs such as vaccinations, spay/neuter procedures, and wellness exams are generally not covered under standard pet insurance. Some companies offer add-on wellness plans for this type of care.

Pre-existing conditions: Any conditions that appeared in your pet before you purchased your policy or during your policy's waiting period are generally excluded. Many insurers exclude bilateral conditions — issues that can affect both sides of the body. For instance, if hip dysplasia developed in one leg before coverage began, treatment for the other leg may not be included.

That said, some pet insurance companies differentiate between curable and non-curable pre-existing conditions. These insurers will cover pre-existing conditions that can be healed after a symptom-free and treatment-free waiting period, which can range from six months to one year.

Intentional injury: Policies won’t cover injuries caused intentionally, such as those related to abuse or organized fighting. Repeated incidents caused by owner negligence may also be excluded. Additionally, costs associated with breeding are usually excluded.

How much does pet insurance cost?

According to the North American Pet Health Insurance Association (NAPHIA), the average accident and illness policy in 2024 cost $62.44 monthly for a dog and $32.21 monthly for a cat.

Ultimately, your premium is a reflection of the likelihood that you'll file a claim. As a result, your premium will vary based on a number of factors — encompassing your pet, your policy and where you live.

Your pet

The most important information about your pet that affects your premium is their species, age and breed. Cats are generally cheaper to insure than dogs, partially because they're generally smaller, so their treatments aren't as costly.

Cats are also notorious for hiding their injuries and illnesses, so cat owners tend to take them to the vet less frequently.

Breeds that are known to have predispositions to particular medical issues may cost more to insure, particularly among dogs. For example, longer dogs, like dachshunds, are unusually likely to develop back issues like intervertebral disc disease (IVDD). Flat-faced dogs, such as French bulldogs, are predisposed to breathing and airway issues. Additionally, purebred pets are generally more expensive to insure than mixed-breed pets, because they're more likely to suffer genetic medical problems.

Your pet's age at the time of underwriting also greatly affects your premiums, since older pets are more vulnerable to injuries and illnesses. Some insurers actually turn away pets of a certain advanced age. Most pet insurance companies reserve the right to increase your premiums annually according to your pet's age, a practice known as birthday pricing. The increases can double or even triple your premiums by the time your pet is very old.

Your policy

The policy you choose will also greatly affect your premiums. Accident-only policies are usually a fraction the price of accident and illness policies. NAPHIA found that the average accident-only policy in 2024 cost $16.10 monthly for a dog and $9.17 for a cat. Accident-only policies don’t cover illnesses, which are among the most common reasons for vet visits.

Additionally, as noted above, your deductible, reimbursement level and coverage limit will also affect how much you pay for coverage.

Where you live

Pet insurance companies also consider the cost of vet care in your area. If you live in a state where vet costs are higher, you'll have higher premiums across the board. Additionally, urban areas generally have higher vet costs than more remote areas. This is due to the higher operating costs in cities, such as rent and staffing — which can make veterinary care more expensive than in rural areas.

Pet insurance pros and cons

Pet insurance pros

• Medical emergencies: Pet insurance offers the reassurance that your pet's medical bills might be covered, at least in part, if a costly emergency arises. It can also ease the financial anxiety over whether to see a vet when your pet is acting abnormally.

• Good for chronic conditions: Pet insurance is especially reassuring if your pet develops a chronic condition that needs ongoing treatment, like cancer or allergies. Instead of paying for each vet visit, you can rely on your pet insurance to foot part of the bill after you meet your deductible.

• Access to any vet: Unlike companies that insure people, pet insurance companies don't have medical networks that encourage or require you to use an in-network provider. You are free, then, to go to any vet. That may reduce worry over how much a particular vet charges, though you still may want to be mindful of cost with respect to not exceeding your policy's coverage limit.

• Budget friendliness: Pet insurance allows you a steady monthly expenditure that you can plan around, instead of simply hoping your pet doesn't get sick. (That said, you still need to budget for the policy's premiums and co-pays.)

Pet insurance cons

• Premiums and cost-sharing: Pet insurance requires paying monthly premiums, plus deductibles and co-pays when you use the coverage. Over your pet’s lifetime, you may spend more in premiums than you receive back if your pet stays generally healthy.\
• Changing costs: Premiums often rise as pets age or as veterinary care costs increase. This means your monthly payment may be higher in later years than when you first enrolled.
• Coverage limits and exclusions: Most policies don’t cover pre-existing conditions, and some limit coverage for older pets or certain hereditary issues. Reviewing what is and isn’t included is key before enrolling.
• Payment model: Most plans reimburse you after you pay the vet, so you’ll need to cover expenses upfront before getting reimbursed. Some insurers now offer direct-to-vet payment in certain cases.

The bottom line

Pet insurance tends to be most valuable when pets face serious accidents or chronic illnesses that require costly treatment. Many pets may not need that level of care, but having coverage means you’re prepared if it happens.

If a pet becomes seriously ill later in life, some owners may decide against pursuing extensive treatment. Insurance can help reduce the financial burden in those cases, though it usually still involves co-pays and deductibles. Insurance may be a good fit for pet owners who know they would pursue treatment regardless of age or cost, since it helps offset the expense of ongoing care.

Not every owner will see a financial return from insurance, since many pets remain healthy. Some prefer to set aside savings for care, while others value the peace of mind of knowing a major bill won’t derail their budget. The right choice depends on your financial situation and your approach to your pet’s care.