That's my puppy, Ruby. She's an adorable little mutt I got at Animal Haven, a shelter in New York City. Like many pet owners, I dote on this little rascal. I enrolled her in puppy kindergarten class. I have dozens of photos and videos of her on my phone. I spend way too much time thinking about her poop schedule. And, unlike most pet owners, I bought pet insurance for her.

When I mention this to my friends with pets, I get a lot of the same responses:

"Isn't pet insurance a waste of money?"

"Oh, I had pet insurance before, but it didn't pay for anything."

Mind you, these are the types of pet owners who would, and have, spent a lot of money on vet expenses because they consider their pets a part of the family. And when I explain to them what pet insurance actually is, and how it works, I get a lot of this response:

"I wish I had known that before!"

So here's what I tell them, and what all pet owners should know.

Pet insurance is a safety net you hope you never have to use

Pet insurance is simply health insurance for your pet. If your pet gets sick, or is injured, and you have to take them to the vet for care, pet insurance will cover a portion of those expenses. Most pet owners understand that part. But then they'll do this calculation:

If I pay $30 per month for pet insurance, that's $360 per year. If I don't get at least $360 back in benefits, then pet insurance is a waste of money.

And that is entirely the wrong way to think about pet insurance. In fact, it's entirely the wrong way to think about any insurance. Insurance is not a savings plan or an investment product where you put in money with the expectation that you'll eventually get more in return. Do you think about car insurance that way? Or homeowners insurance? Of course you don't! If you're a car owner or homeowner, you get insurance as a safety net for a bad scenario that would cost you a lot of money. If you're hoping for a return, or at least a break-even, on your homeowners insurance or car insurance, then that means you're hoping for something bad to happen: an accident, a theft, a loss. It's the same with pet insurance. If you're hoping for a return, or at least a break-even, on your pet insurance, then that means you're hoping for something bad to happen to your pet...because that means you're getting money back. Twisted, isn't it?

But of course pet owners who've thought that way about pet insurance aren't hoping that something bad happens to their pet. It's just implied if you take that line of thought to its weird conclusion. I blame a few things for this illogical thinking about pet insurance:

