Is Buying Life Insurance for Your Pet an Expensive Mistake?
It makes sense to purchase a life insurance policy to cover yourself or your spouse if you want to ensure that your family is protected financially in the event of a tragedy. Some people even purchase life insurance for their children to enable them to secure low-cost policies that can stay with them into adulthood. But what about your family pets? After all, Fido and Whiskers may be bona fide members of your family too. Should you buy life insurance policies for them as well?
In most cases, the answer is "No." It is rare for animals to have income potential, so although your pet may have incalculable value to your family, in the eyes of insurance companies, it is worth only its value on paper. That is to say, the value assigned to it will be either the price you paid to purchase it, or the cost to replace it with a pet of the same breed. Emotional value does not come into play. There are exceptions, of course. Rare breeds, show dogs, and famous pets frequently have an assessed value that greatly exceeds their purchase or replacement price.
Costs Associated with Pet Funerals
- Cost to cremate a pet: $60 to $150
- Cost for an urn for a pet’s ashes: $35 to $400
- Cost for a burial plot in a pet cemetery: $400 to $600
- Cost for a pet casket: $50 to $500
When a beloved pet passes, it can be very hard on the family who loved it. Many people feel compelled to provide their pet with a proper burial or funeral service. Unfortunately, these costs can often run rather high. You may therefore think that purchasing a life insurance policy for your pet can help to alleviate these costs. However, these policies have limits that make them a good financial decision only for a small handful of pet owners.
What Are the Limitations of Pet Life Insurance?
Pet life insurance is different from pet health insurance. It is designed to cover unexpected deaths such as those that may result from an accident or sudden illness. Your insurance company can provide you with compensation in the amount of your pet’s value, as determined by its purchase or replacement cost, or its assessed value. Some insurers will also offer to cover euthanasia, burial or cremation costs in exchange for higher premiums.
However, not all pet deaths are covered. You are likely to face a number of policy exclusions, including such things as:
- Hereditary diseases: Some purebred dogs are prone to serious illnesses, and deaths caused by these illnesses will not be covered by dog life insurance. For example, Lhasa Apsos are prone to develop hereditary kidney disease and inguinal hernias; Irish Setters are vulnerable to hemophilia and certain neurological disorders.
- Preexisting conditions: Your insurance company will require a health assessment by a veterinarian before issuing a policy. If your pet already suffers from a serious illness, whether hereditary or not, you may not qualify for coverage.
- Old age: Pets age, and their life expectancy is shorter than that of humans. Pet life insurance limits coverage to a given time span that provides coverage while your pet is in its prime of life. The coverage is therefore limited to accidental deaths and sudden illnesses.
Most Popular Dog Breeds and Their Life Expectancy
- Labrador Retriever , 12 years
- German Shepherd, 10 years
- Golden Retriever, 12 years
- Beagle, 12 years
- Bulldog, 6 years
- Yorkshire Terrier, 14 years
- Boxer, 9 years
- Poodle, 12 years
- Rottweiler, 9 years
- Dachshund, 13 years
Life Insurance for Dogs
Smaller dogs tend to have longer lifespans than larger ones. The time limits of your dog life insurance policy will depend on the breed of dog you are insuring.
Typically, dog owners who can benefit from purchasing a dog life insurance policy for their pets own breeds that cost a lot of money. Others that may want to consider a policy are those whose pets compete in Best of Show events or are famous—such as those who have roles on TV shows or who have become popular on the Internet—since these canines can provide a source of income for their owners.
Paris Hilton reportedly shelled out $25,000 for two teacup Pomeranians. While these dogs may have a value that justifies life insurance coverage, if you have the money to pay that much for a dog, you probably have enough to easily cover funeral costs without the need for pet life insurance.
Life Insurance for Cats
Cat owners tend to be less likely than dog owners to seek life insurance policies for their pets. At fifteen years, the average lifespan of a cat is longer than that of a dog, so cat life insurance policies often have longer coverage periods. Some cats, such as Persians, Bengals and Savannahs, can cost several thousand dollars.
“Grumpy Cat” is an example of a cat that might be worth purchasing a life insurance policy for. This cat, named Tardar Sauce, was born with an underbite and dwarfism, which work together to make it appear that the cat is always scowling. Grumpy Cat quickly grew famous as a Web meme, and her owner has made millions of dollars through commercial projects that have starred her cat. This is one example of a pet that would be assessed at a value far greater than its purchase price.
Is Pet Life Insurance Really Necessary?
According to Harris Interactive, Americans spend an average of $1,191 a year on their pets. The largest expenses are food, at $476, and healthcare costs, at $425. There is no reason to incur the extra cost for cat or dog life insurance unless your pet has a high assessed value.
The American Pet Products Association reports that there are approximately 86 million cats and 78 million dogs living with families in the United States. While many of these families might benefit from purchasing health insurance policies for their pets, very few would benefit from purchasing pet life insurance policies.
With a few exceptions, it would make more financial sense to simply put the money you would spend on a pet life insurance policy into a savings account set up specifically for the purpose of covering your furry friend’s eventual burial or cremation costs.
Making the Decision to Get Pet Life Insurance
If you feel that your pet has an estimated value that justifies the cost of a pet life insurance policy, you may want to learn more. A local Trusted Choice® agent can help you find one of the few insurance companies that offer this type of policy, so you can review prices and crunch numbers. These agents can also serve as a resource when you are shopping for any type of coverage, such as auto, home, or life insurance policies. You can get more information by contacting an independent agent near you.