Should I Buy Life Insurance For My Cat?
Estate planning for pets is a big field now. The majority of American homes have one. Attorney Rachel Hirschfeld points out that pets are property, so their care becomes an issue if the owner predeceases them. This is especially true for people who are single, or married with no children or close relatives.
Pet trusts have become a popular tool for pet owners to ensure proper care, as described by attorney Tracy Craig. They help secure the necessities such as assigning a caretaker, establishing a standard of care, and providing funds. Here is an example of how the cost of care can be calculated:
The pet trust will need to hold a certain sum of money to pay for the pet’s care. To determine the amount, first estimate the annual costs of food, pet insurance, veterinary care, routine medications and supplements, as well as any other recurring costs, and then multiply that by the entire life expectancy of the pet. It is also important to factor in extra medical costs as pets age — as is true for people, medical care costs increase as the pet ages.
Because a pet trust can also provide for multiple pets, make sure that your clients factor the costs of caring for all covered pets into the final budget.
Finally, the owner should clearly state in the trust that the care of the pet is the trust’s primary purpose, and that all funds should be used to care for the pet.
Life insurance is a good way to fund the trust. It can provide the exact amount of money needed exactly when it is needed. This policy can be separate from the other policies you have for your family, business, and favorite charity. Your attorney can help you set it up so that the trustee has full responsibility for the policy proceeds.
Do you have a cat? A dog? Is his future secure?