Pet Insurance Sees Another Year of Double-Digit Growth
More than 3.1 million dogs and cats were covered in 2020 as the U.S. market hit $1.99 billion.
U.S. pet owners spent just shy of $2 billion in 2020 on pet health insurance, a 27.5% one-year increase and an all-time record.
Rick Faucher, the North American Pet Health Insurance Association’s board president, called the sales figure a sign of a maturing, 41-year-old U.S. industry.
“With only a fraction of the potential market realized, we are confident the North American pet health insurance market can continue on this steady pace of growth for the foreseeable future,” he said.
The number of insured U.S. pets hit 3,101,956, with 83% of them dogs and 17% cats. NAPHIA’s annual report found that 19.2% of insured cats and dogs lived in California, 8.7% in New York and 5.8% in Florida.
When Canadian premium sales of $188 million (U.S.) are added to the U.S. figure of $1.99 billion, the North American market saw its sixth consecutive year of double-digit growth.
According to NAPHIA, evidence of the maturing market included:
- The introduction of new products from large companies such as Zoetis, which launched the insurance brand Pumpkin in April 2020.
- Ongoing discussions with government regulators to create a stronger regulatory framework for the U.S. industry.
- A significant increase in the volume of claims being processed.
The NAPHIA report broke down the average U.S. pet insurance premiums. For accident and illness coverage, dog owners paid $599.03 a year, or $49.92 a month. Among cat owners, the figures were $341.35 and $28.44, respectively.
NAPHIA’s executive director, Kristen Lynch, said COVID-19 played a role in the insurance market’s skyrocketing performance.
“Last year, we saw the stay-at-home and work-from-home measures introduced during the pandemic create even closer bonds between pet owners and their pets,” Lynch said. “We believe these strong human-animal relationships are driving pet owners’ desire to address financial uncertainty by mitigating unexpected veterinary costs, contributing to our record 2020 results, in a year that also saw new pet purchases and adoptions reach record levels.”
Melissa Gutierrez, senior vice president and general manager at Pets Best Insurance, said the report was further proof of the humanization of pets.
“From estate planning to joint-custody planning, the role pets play as part of the family is growing increasingly more significant,” she said. “According to petinsurer.com, over 70% of pet-owning households even sign their pet’s name on family holiday cards.
“It’s no wonder then that we see the utilization of pet insurance to be much higher than many other insurance lines, with many people visiting their vet and submitting claims multiple times a year.”
The complete report is available at bit.ly/3tt9BB6.
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WHO’S WHO IN PET INSURANCE
Click here to download a free PDF showing the companies competing in the U.S. pet health insurance market.