Our beautiful Labrador Retriever mix, Sophie, is getting on in years. At 15, she is at the outer edges of life for a dog of her size, but she is still hanging in there. We’ve been fairly lucky with her. She’s been mostly healthy since we got her at roughly the age of two. But a recent visit to the Veterinarian for an ear infection got me thinking about pet insurance.

While Sophie has been mostly healthy, there have been a few spendy episodes. She came to us from the humane society with pneumonia, and that cost about $500 to treat. She had poor teeth, and before we started brushing them every day, she wracked up around $800 a year in teeth cleanings and extractions. She also had a bout of skin cancer that ran about $1,000 for surgery.

If your savings are low, these expenses can push you into debt. So is pet insurance a good idea? Like other insurance products, if a potential loss would be financially devastating, it might be, but you have to be careful with what you buy.

The pet insurance market is hard to navigate. Every policy is unique, and it’s easy to buy a policy that doesn’t do what you would expect. Some cover just accidents, some cover accidents and illnesses and only a few cover routine vet visits.

The fine print can lead to less coverage than you’d expect. For example some policies have bilateral exclusions, meaning that a policy will only cover a condition once, even if the same condition occurs on both sides of the body. Some policies have per incident deductibles, while others have annual deductibles.  Some policies will only cover average costs in your area, and not the specific cost charged by your vet.

Petinsuranceeu.com has done a comparison of several pet insurance plans. Plans range in price depending on your pet and the area where you live. To see if pet insurance would have been a good idea for Sophie when we got her, I got a quote from their recommended carrier, Healthy Paws, for the two year old dog she was at the time.

Healthy Paws’ quoted premium was $38.41 per month, covering 80 percent of the cost of care after a $250 annual deductible. There were several exclusions in the policy. For example, the pneumonia wouldn’t have been covered, since she had it when we got her. And the dental procedures would not have been covered either.

What would have been covered was her cancer treatment. After the deductible, Healthy Paws would have covered a little over half the cost. Her recent ear infection and treatment would have been covered, but was within the deductible, so no benefit there.

Over Sophie’s life with us to date, we would have paid over $7,000 in premiums and received back $550 in benefits. Of course, we might not have been so lucky with Sophie.

She was an athletic dog in her day, and she could have easily torn an ACL, or her cancer might not have been so easily treated. An ACL surgery would have cost around $3,000, and the pet insurance would have paid around $2,150 of it. Chemotherapy could have run up to $10,000 and pet insurance would have covered three quarters of it.

In fact it would have taken the chemotherapy to get our premiums back. But that is the thing with insurance. Insurers use the premiums paid on healthy dogs to cover the dogs with more problems. You buy insurance against an unlikely, but financially devastating, event and hope you don’t have to use it.

If you have the savings to cover the costs associated with a serious injury or illness in your pet, then pet insurance isn’t necessary. Overall pet costs will be less, because you’ll save the premium. But if you don’t have the savings, it’s worth looking into pet insurance. It can keep you from derailing your budget and going into debt to save your beloved family member. However, pay attention to the details, so you understand what coverage you are buying, and shop around for the best policy.