Nowadays, pets are family, too! When it comes to family, we need to provide care in the manner of food, shelter, love and medical expenses. A pet owner has a responsibility to have adequate means to take care of vet bills. One can do this by saving up enough funds to cover veterinary expenses or you can transfer your risk to an insurer through pet insurance.
Which one do you currently have in place? Pet insurance for vet expenses is starting to make sense in South Africa with innovative treatments and advances in medical treatments. How are you accounting for those expenses?
You never know how much a vet bill could end up costing you. Let’s take the worst-case scenario, if the left hip of your dog is operated on, the cost could be anything between R20 000 and R30 000 or more. After a couple of months, the right hip could also need treatment as it has sustained increased pressure due to the weakness of the left hip. You would be in store for a hefty vet bill. There are pet insurance products which can cover the cost and there are others which can cover some of the cost.
A lot of clients ask about cover for routine care expenses such as vaccinations, grooming, flea and tick treatment and so on. These are expected expenses as a pet owner and the cost per annum can be calculated accurately with some planning.
From a financial advisor point of view, we have started to recommend pet insurance as a viable means to manage your risk of incurring unexpected veterinary expenses. For us as advisors, the emphasis is on unexpected.
When setting up a budget, you want to budget exactly for an expense monthly. E.g. I use 2 kg coffee in a month, therefore I budget R500 for coffee beans per month. Now, your expected expenses as a pet owner can also be calculated in this way. For example, my routine care costs = R2500 per year, therefore, I must save R210 per month.
Now, here’s the kicker and the reason we have started recommending pet insurance. You cannot budget for an unexpected expense accurately. Meaning, you do not know whether your next vet bill will be R600 or R30 000. You also don’t know if one vet bill will be followed up by another one, two or three thereafter. Your savings plan could be exhausted if there is more than one claim in a short space of time.
Most of us have a contingency plan or an emergency savings account but our savings most of the times will not be at R30 000 from day 1 of having our puppy. The reason we as financial advisors recommend pet insurance is that you can budget a fixed amount monthly for an unexpected expense. I know that my ‘x’ amount premium will provide me with ‘y’ amount of cover for my unexpected expenses.
To us, the best product for our clients is one that is able to pay a claim when you really need it. Get in touch, if you want more info or advice regarding your specific situation.