Why I'm happy to pay nearly $400 a year to insure my perfectly healthy cat

Recently, I was chatting with my parents about my finances.

I showed them my monthly budget, which has categories for all of my regular expenses.

One item made them pause: $32.77 a month for pet insurance.

"But your cat is perfectly healthy!" my dad said. "You shouldn't waste your money."

My mom agreed. "He's young, and he doesn't go outside. I don't think you need insurance."

But, as Gerri Detweiler of Credit.com points out, it's easier to get insurance when your pet doesn't need it.

Plus, even young, healthy pets can have emergencies - like the cat who swallowed a rubber band and required surgery costing $1,300.

I know that if anything like that ever happened to my 6-year-old cat Rico, I'd max out my credit cards in order to keep him alive. So when a friend of mine mentioned that she'd insured her dog with Petplan, I didn't think that she was crazy. In fact, I signed up for a policy of my own in September 2014.

Twelve monthly payments of $32.77 comes to $393.24 a year, but that's still less than paying several thousand dollars for an expensive procedure, especially when you add interest. So it's a price that I'll happily pay.

Clearly, other pet owners agree with me. The number of people who insure their pets has been growing steadily over the past eight years, according to a study by IBISWorld. Currently, 181 million pets in the United States have insurance. That's only 1% of all pets in the country, but due in part to the increasing costs of veterinary care, the pet insurance industry is expected to grow 6.8% annually.

You can call me paranoid if you'd like, but I'm glad to pay $33 a month for peace of mind.