Pet insurance: Lots to chew on

Justin and Brandy Besemer were newly married and trying to pay off their wedding debt when they decided their family needed a dog -- an American Bulldog named Kaila.

Thus started one of their first arguments.

Brandy, who had never had a dog before, wanted to spend a little over $300 a year to buy pet insurance. Justin, who had always had dogs, thought it was a waste of money.

"His parents told me this horror story that made me insist we get it," explained Brandy, 28. "They were talking about their dog having to have a knee replaced and it cost them like $2,000. We couldn't afford that. I just didn't want to get a dog if I couldn't afford to take care of it."

When Kaila chewed up a string of Christmas lights a few months later, landing the dog in an emergency veterinary center, the Santa Monica couple was relieved that Brandy had prevailed. When they found that the dog had chronic urinary tract infections and food allergies, they realized that without the insurance they wouldn't have been able to afford treatment for Kaila.

"We joke that she's our little lemon," Brandy said. "This is the longest we've gone without having to take her to the vet, and it's been maybe three weeks."

Although the Besemers are delighted that they spent the money to buy pet insurance, plenty of experts agree with Justin's first assessment: It's a waste of money. If the couple had a different policy or a different disposition, it might be. However, as is true with many personal finance decisions, the smart choice on pet insurance is a personal one.

By and large, experts maintain that it's wasteful to insure against risks that are not catastrophic. It doesn't make sense, for example, to buy pet insurance to pay for routine medical issues such as shots and checkups. That's because you'll pay roughly as much for the coverage as the treatment. Whether it makes sense to buy a policy for major medical bills hinges on two things: emotion and finances.

If you would be emotionally devastated to lose a pet simply because you couldn't afford to treat it -- and a $5,000 vet bill would be more than your budget could take -- you might want to consider a policy. But if you have the resources to pay for emergency vet care -- or wouldn't be devastated to lose a pet if you didn't -- you could skip pet insurance.

Some suggest you set aside the amount you saved in premiums for future vet bills. If the dog is healthy, you could be far better off. If it's not, your economic health will depend on whether or not you choose to treat the animal.