Advanced options
Self-insuring only works if the big bill politely waits for the pot to grow: a cruciate ligament op runs GBP 4,000-6,000 and can happen in year one. Insurance also can't be bought after the event: anything diagnosed becomes a pre-existing condition, excluded by every future policy. Lifetime cover (per-condition-per-year limits that renew) is the tier that actually protects against chronic illness.
What The Pet Insurance vs Savings Calculator Works Out
- Premiums paid: the monthly premium x 12 x the years compared. GBP 35 a month is a typical lifetime policy for a young medium dog; cats are usually GBP 10 to GBP 20 and brachycephalic breeds pay a surcharge that is actuarial honesty about bulldogs.
- Same money saved instead: the identical monthly sum put into a savings pot. After ten years the pot equals the premiums, but only GBP 420 of a GBP 35 pot exists at the first anniversary, which is the whole argument.
- The real question: timing. A cruciate repair, swallowed sock or MRI respects no schedule and lands as happily in month three as in year nine. The pot is a bet that the catastrophe waits; the premium is a payment for not making that bet.
- Policy excess: the fixed amount you pay on each condition claimed, typically GBP 60 to GBP 200. It is added to the premium total in the subtitle because insured owners pay it too.
- Premium increase each year (advanced): compounds the premium annually. Real pet premiums rise steeply with age, often 10% to 20% a year by the time a dog is eight, so the escalated total is usually far above the flat figure.
- Savings interest rate (advanced): grows the pot at the AER entered, applied once a year to the running balance. The year-by-year table shows premium, cumulative premiums and the pot side by side.
- Co-payment on claims (advanced): the percentage of each claim above the excess that you still pay. Many insurers add a 20% co-payment once a pet passes eight or nine, which quietly shifts a fifth of every bill back to you.
- Big vet bill and the year it lands (advanced): tests both strategies against one large bill (default GBP 5,000, in the range of a cruciate op) arriving in a chosen year. The cards show your share if insured, the pot saved by then, and the shortfall the credit card would have to cover.
- Big bills needed to break even (advanced): total premiums divided by what the insurer pays per bill. Below 1.0 the insurance has paid for itself with a single claim; well above it, the pot has been the cheaper strategy unless the pet turns out unlucky.
- Number of pets (advanced): multiplies premiums and deposits for a multi-pet household; most insurers give 5% to 10% off additional pets, so trim the premium accordingly. Whatever you choose, either insure or actually save: the default third option, neither, is the one that ends with the credit card meeting the emergency at 2am.
Further reading: PDSA.