Sherman and Amanda Bausch say they learned about pet insurance the hard way.
In recent years, their two cats have had "issues ... $500 to $1,000 worth," said Sherman.
So when the St. Paul, Minn., couple adopted a dog from the Humane Society last March, they decided to get a health-care plan for all their pets. Since then, Vera, their German shepherd mix, has eaten a plate of brownies, developed cataracts and contracted Lyme disease. Their cat, Jello, also had a few more issues.
While they've paid more than $1,000 in vet bills since March, they estimate they've saved close to twice that much.
''I know pet insurance is a luxury. We're fortunate to make enough money to carry it," said Sherman. "But knowing what I know now, I wouldn't get a dog without it."
That places the Bausches firmly in the minority.
Americans now spend $575 per cat and $852 per dog with veterinarians every year, according to the American Pet Products Association. Even with the economic downturn, vet expenditures for all pets rose 14.3 percent from 2006 to 2011, while the Consumer Price Index climbed 11.6 percent, according to the American Animal Medical Association.
Newer procedures (treatment for cancer, knee surgery, teeth-cleaning) combined with inflation have fueled the price increases, said Healthy Paws Pet Insurance owner Steve Siadak, who also cited "the humanization of pets (as) the new kids."
But despite the fact that Americans are spending more on vet care, fewer than 1 percent of the estimated 171 million dogs and cats in the United States are insured. That compares with 26 percent in Great Britain and 48 percent in the Netherlands.
''I don't think Americans love their pets any less than in Europe," said Laura Bennett, CEO of Embrace Pet Insurance, "but they don't like insurance as much."
In the United Kingdom, "the veterinarians had a good experience, and the people had a good experience," with pet-care coverage, said Bennett, who grew up there. In fact, the industry took such a firm hold that many employers offer pet-care coverage to their employees as a perk. In the United States, few major employers have followed suit.
The Bausches buy their coverage from Banfield Hospitals, which are affiliated with retail giant PetSmart. So does Heather Manley, of Hopkins, Minn., who said she liked having the coverage because it's "proactive vs. reactive."
For $33 a month, Manley said she gets "discounts on all medicine, a physical every six months, a dental cleaning, unlimited no-charge vet visits -- and should my dog get really sick, the ability to upgrade level of coverage on-site to cover X-rays, blood work, etc."
Traditional pet coverage differs from human health-care coverage in that the insurers reimburse their customers, rather than paying the veterinarians. (Animal clients also can be denied due to pre-existing conditions, or charged higher rates based on a pet's age.)
Vera Mariner, of Minneapolis, buys insurance for her three dogs, but she advises other pet owners to research a plan thoroughly before buying.
In April, her dog Maggie had surgery to remove a benign tumor, but the insurance company paid less than 20 percent of the cost, she said.
''My advice is to be vigilant," Mariner said, "and really read the fine print as to what is covered. And to insure your pet as fully as you can manage financially from puppyhood. Otherwise. ... "
Hilary Simonson, of St. Paul, knows all about the "otherwise." In 2007, her dog ate an albuterol inhaler and needed $5,000 worth of care. Simonson, who said she was cash-poor after "a nasty divorce," asked her father to cover the bill.
Soon afterward, her cat was diagnosed with kidney failure and needed treatment. Her father helped out again, she said, but "this time, he included a magazine article on 'when to let your pet go.' I knew the well was running dry."
So Simonson studied several plans, and found one for her puppy, Melba, and new kitten, Leroy.
''My pets are my children. I will spare no expense for their happiness, health and wellness," she said. "Having insurance for them gives me peace of mind."