Pet Life Insurance Is a Thing. Do You Need It?

These days, it seems like you can insure just about anything. We all know about homeowners insurance and auto insurance, but now there's also wedding insurance and pet insurance and even pet life insurance. Yes, you heard that correctly. You can take out a policy against your fur baby's life and collect cash when they die.

But if you think you'll just insure them for millions and enjoy a nice retirement after they're gone, you'll have to keep dreaming. That's not how these policies work. Here's what you need to know and how to decide if one of these is right for you.

What is pet life insurance?

Pet life insurance is exactly what you think: life insurance for your dog, cat, or other pet. Just like with life insurance for humans, the policy pays a death benefit to the policyholder when the pet dies. There are two main types of policies: full mortality and limited mortality. Full mortality policies cover the pet's death regardless of the reason. Limited mortality policies will only pay the death benefit if the pet dies due to a covered reason, like severe weather.

Some policies also cover the theft of the animal. So if the pet is stolen and the owner is unable to recover them, the insurer will also give them the agreed-upon death benefit.

But you can't just take out one of these policies for any ordinary house pet. Typically, insurers only sell these policies for pets who earn income or are valuable in some way. For example, it might be possible to take out a pet life insurance policy for a police dog because it performs a valuable service and would be costly to replace. Similarly, you could take out a policy on a prize-winning racehorse because it makes its owners money, which they will lose if the horse dies.

How much does pet life insurance cost?

Like all insurances, pet life insurance costs vary depending on several factors. The age, breed, and species of the pet are obviously important. Older pets are typically more expensive to insure than younger pets, and those with major health issues may not be eligible for a policy at all. The type of perils the plan protects against also have a huge effect on the cost.

These policies have the usual deductibles and premiums to worry about. Going with a higher deductible can make monthly premiums more affordable. But it leads to larger out-of-pocket costs in the event of a claim.

Ultimately, the only way to know how much a pet life insurance policy costs is to compare quotes from several providers to see what they can offer. But generally, these policies are pretty expensive. Some may cost up to $900 per year.

Where can you get a pet life insurance policy?

The major life and pet insurers don't offer pet life insurance. Those interested in this coverage will have to seek out specialty insurers. Some companies that offer these policies include:

• The Hartford
• Ark International Group
• Amwins
• Sanger Insurance

You can find others by searching for "animal mortality insurance" online. Searching "pet life insurance" may lead you to pet health insurance policies instead.

It's not for everyone

Most pet owners don't have much to gain from purchasing a pet life insurance policy -- assuming they can get one at all. Those hoping for some assistance with vet bills for injuries and illnesses should invest in a pet health insurance policy instead. These are more readily available and they're more affordable too, especially for those who opt for an accident-only plan. It's pretty easy to compare quotes online, and most companies enable pet owners to purchase a policy within a few minutes.