One of the traps that pet owners fall into when they start investigating pet insurance is that their focus is often on the monthly or annual premium. I guess this is logical because they want to know “How much is this going to cost me?” That’s a good question, but besides the monthly premium, the largest potential costs will be your out-of-pocket costs when you file a claim. The quality of the policy you purchase will determine your overall long-term costs.
I heard an interview recently that Bob Burg did with Tom Ziglar (Zig Ziglar’s son). Tom told the story about when he was a child, Zig got him a bicycle at a local store for about $35. He said that before long, he had to replace the handle bars, wheels, tires, chains, etc. and it ended up being an expensive bike to own. He then got a Schwinn bicycle and he said that it lasted many years with just about the only maintenance being replacing the tires. Even though the Schwinn bike cost about twice what his first bike did, in the long run – it ended up costing much less.
The same could be said about pet insurance policies. You must do your due-diligence when researching companies and policies to make sure that in the long run, you’ll minimize your out-of-pocket expenses when you file claims. When purchasing pet insurance, just like anything else, you usually get what you pay for. In fact, when you obtain a quote, some companies will recommend a policy for your pet. You should be careful about automatically accepting their recommendation because sometimes the policy they recommend will be one of their least expensive policies (lowest premium), but most expensive (out-of-pocket costs) especially if you have to file a large claim.
While most pet owners are focused on the premium, the cost that matters the most is your total out-of-pocket expense (including the premium) – especially if you have to file a large claim. This is where deficiencies in some pet insurance policies are magnified. Therefore, it is essential that pet owners use “what if” scenarios and calculate these potential out-of-pocket expenses in order to pick the best company and policy for their pet.