A budget pet insurance plan is easy to buy and easy to regret. Cut the wrong setting and the plan looks cheap until the first claim, when you discover you are paying most of the bill yourself. This guide shows what each money-saving setting really costs you on a claim, and how to build a lower-priced plan that still protects you from the large bills that justify insurance in the first place.
Premium figures come from MoneyGeek reports updated in August and September 2026. Discounts come from Lemonade’s pet page, checked October 13, 2026. Sources are listed at the end.
The Baseline: What the Standard Policy Costs
MoneyGeek models a standard policy with a $5,000 annual limit, $500 deductible and 80% reimbursement. At that setting the national average is $47 a month for all pets, $61 for the dog baseline (a 6-year-old Labrador) and $32 for cats. Everything below is a change from that starting point.
What Each Saving Costs You on a Claim
Take a $3,000 vet bill. This table shows what you would pay on the standard settings and after changing one setting at a time. It is an illustration of the arithmetic, not a quote.
| Setting | Deductible | Reimbursement | Insurer pays | You pay |
|---|---|---|---|---|
| Standard | $500 | 80% | $2,000 | $1,000 |
| Higher deductible | $1,000 | 80% | $1,600 | $1,400 |
| Lower reimbursement | $500 | 70% | $1,750 | $1,250 |
| Both | $1,000 | 70% | $1,400 | $1,600 |
| Better coverage | $250 | 90% | $2,475 | $525 |
A higher deductible and a lower reimbursement rate together cost you $600 more than the standard setting on this one claim. A good test is whether the premium savings over the years are larger than that difference in the year you claim. For a pet with a high chance of claims, they probably are not.
What to Never Cut
- Illness coverage. Accident-only plans are cheaper because they pay for far less. Most large bills in dogs and cats are illnesses. Read accident-only vs. accident and illness.
- An annual limit below your realistic worst year. A $5,000 cap is a gap for large breeds, where a hip or bloat bill can pass it. See limits explained.
- Enrolling young. Waiting to save money usually costs more, since premiums rise with age and exclusions follow the first symptom. See when to get pet insurance.
What You Can Cut Safely
- Wellness add-ons. They rarely pay for themselves unless you use every benefit. See our wellness add-ons guide.
- A high reimbursement rate on a small, low-risk pet. 80% is a sensible middle point.
- The deductible, if you can pay it comfortably and your pet rarely claims.
Discounts to Look For
Lemonade lists a 10% bundle discount, a 5% multi-pet discount and a 5% discount for paying annually. Other insurers have their own, and some change by state. For a household with several pets, see our multiple pets guide.
A Reasonable Budget Setup
- Accident and illness coverage from the start.
- A $500 deductible if you could pay it quickly, otherwise $250.
- 80% reimbursement for a small pet, 90% for a high-risk breed.
- An annual limit of at least $10,000 for a large breed and $5,000 for a small dog or cat.
- Annual payment if the insurer discounts it.
- Quotes from at least three insurers with the same settings. See our cheapest companies guide.
Frequently Asked Questions
What is the cheapest type of pet insurance? Accident-only. It is also the one that covers the least.
Is a high deductible a good way to save? Only if you could pay it without hardship and your pet is unlikely to claim often. See deductibles explained.
Should I skip insurance and save the money? It depends on whether you could pay a $3,000 to $5,000 bill. See insurance vs. a savings account.
The Bottom Line
Lower the price by trimming the extras and by choosing a deductible you can afford, not by cutting illness coverage or the limit. The cheapest plan is the one that costs least after you count what you would pay on a claim.
Sources
- MoneyGeek, Average Pet Insurance Cost for Dogs, updated September 17, 2026.
- MoneyGeek, Average Pet Insurance Cost for Cats, updated August 26, 2026.
- Lemonade, Lemonade Pet, accessed October 13, 2026.
This article is general information, not insurance advice. Premiums and policy terms vary by company, location and policy date.