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As Congress debates how to provide more Americans with healthcare, a separate market is emerging: pet insurance. Americans love their furred and feathered friends: according to the American Pet Products Association (APPA), 62 percent of US households (71.4 million homes) own a pet. Dogs and cats dominate: the odds that a household owns a dog are 1 in 2.69, or 1 in 3.09 for a cat. And the odds a pet cat or dog is insured are 1 in 356.4.

Vaccinations, worming, and spaying or neutering are standard expenses for dog and cat owners, and even pocket-sized pets can develop health problems that require medical treatment. APPA estimates that in 2009, Americans will spend $12.2 billion for veterinary care. So it’s not surprising that companies like Aetna and Purina, as well as animal welfare advocates such as the Humane Society and the ASPCA, have started to offer pet insurance.

Plans vary widely but usually offer several levels of protection: owners can insure Fido just for accidents, or add coverage for “wellness” services such as physicals and dental care. Some policies cover sophisticated treatments, including transplants and chemotherapy, which can cost thousands of dollars.

Less than one percent of US owners have pet insurance today, but the market is growing at double-digit rates. The odds that vet bills will cost a pet-owning household $500 or more in a year are 1 in 4.57, and the odds a pet-owning household will spend $1,000 or more in veterinary bills in a year are 1 in 11.11. So spending $30 or $40 a month for insurance might seem like good planning.

Skeptics point out, however, that pet insurance plans often have large deductibles, co-payments, and exclusions, including pre-existing conditions and hereditary or congenital problems that affect certain breeds (for example, hip dysplasia in large dogs). Consumer Reports calls pet insurance “usually a dog,” and recommends instead that the money be put into an interest-bearing savings account to cover emergencies.

As another option, some companies offer pet insurance as an inexpensive employee benefit (it doesn’t cost employers anything, since workers pay the full cost of premiums in return for getting a group discount). If your workplace isn’t one of them, it couldn’t hurt to suggest it—maybe on Take Your Dog to Work Day, which falls annually in late June.