5 Statistics About America’s Pet Insurance Industry
Owning a pet is a big responsibility, and one of the most crucial aspects is maintaining your pet’s health. Visits to the vet for annual exams, blood tests, dietary consultations, and even emergencies can negatively impact your budget if you don’t do them or can’t plan ahead.
In just one visit, pet owners can spend hundreds of dollars on their beloved companions, even for a simple checkup. This can make caring for a pet difficult for some dog or cat owners if they don’t have the funds to pay an expensive vet bill. Dogs, in particular, can be expensive to maintain as they tend to have more active lifestyles, which unfortunately can lead to potential injuries, especially as the animal ages. In order to protect their pets (and their budget), millions of people in the United States purchase pet insurance to ensure that their pets can always receive the care they need.
Pet insurance works the same way as health insurance for humans. Plans can cover both accident and illness, and you’ll have a deductible that you’ll need to meet before the insurance kicks in. As with human health insurance, the lower the deductible, the higher your monthly bill will be.
But when it comes to pet insurance, what else do you need to know? To answer this question, ManyPets reviewed the North American Pet Health Insurance Association’s latest State of the Industry Report, released in 2021, and found five key points that help explain the role insurance plays for pets and how it can affect and benefit the average pet owner.
Most pet insurance companies in North America participated in the NAPHIA study, some of which are also linked to other similar companies “representing at least 20 other brands of pet insurance products from company”. As a result, NAPHIA’s study reflects approximately 99% of pet insurance plans covering cats and dogs in North America, providing a remarkably detailed snapshot of data on Americans and Canadians who insure their pets. furry friends.
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North America had nearly 3.5 million pets insured at the end of 2020
Pet insurance in the United States got off to a rather glamorous start in 1982, when the first pet to be covered by pet insurance was Lassie, the famous collie featured on the classic television show The same name. From that auspicious beginning, millions of dogs and felines over the ensuing years have received pet insurance to cover the costs of any major or minor medical procedures.
The number of pets insured in 2020 – nearly 3.5 million – showed a marked increase from the 2019 figure of 2.81 million pets insured. These figures are much larger than those of other North American countries – for example, in Canada only 352,631 cats and dogs are covered by pet insurance.
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Over the past five years, pet insurance has grown at an average annual growth rate of 23.4%
The year-over-year rise demonstrated “excellent growth” for pet insurance, according to NAPHIA. But what has caused this significant increase in the increase in pet insurance policies among Americans? NAPHIA Executive Director Kristen Lynch named the COVID-19 pandemic as a major influencing factor.
Because many people were confined and unable to leave their homes, they were with their pets much more often than the old daily routine allowed. This extra “time together” has forged deeper bonds, the effect of which has led to increased interest in purchasing pet insurance. “We believe these strong human-pet relationships drive pet owners’ desire to navigate financial uncertainty by mitigating unexpected veterinary costs, contributing to our record 2020 results, in a year that also seen purchases and adoptions of new pets reach record highs,” Lynch said. .
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The North American pet insurance market is made up of around 20 companies
The plethora of companies offering pet insurance in America and Canada means that people have many options to choose from when looking for plans for their pets. Many of these companies participated in the NAPHIA study, some of which are also linked to other similar companies “representing at least 20 other brands of pet insurance products”.
This means that many of the larger pet insurance companies support or partner with other insurance agencies, creating circumstances in which pet insurance can be obtained from one’s pet insurance company. usual insurance. It also means that pet insurance is a competitive market, which means it’s relatively easy to find a plan that suits your budget.
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Insured cats have seen a higher growth rate, but dogs still dominate the market with 82.9% of all insured pets
Many more pet owners insure their dogs than their cats. This may be because medical care for a dog is generally more expensive than for cats. According to NAPHIA data, the average annual accident and sickness premium for dogs was $599.03, while for cats it was $341.35.
Despite this cost disparity, pet insurance grew 26% in 2020 to become a $2.17 billion industry. “2020 was another year of double-digit growth for our industry. … We are confident that the North American pet health insurance market can continue this steady pace of growth for the foreseeable future,” said Rick Faucher, Chairman of NAPHIA’s Board of Directors. Faucher also pointed to ongoing discussions with federal regulators about creating a stronger regulatory framework for the industry, which could further contribute to its growth by introducing new standards and consumer protections that encourage people to insure their pets.
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California ranks first in the United States with 19.2% of all insured pets; New York is second with 8.7%; Florida is third with 5.8%
Californians have no problem putting the health of their pets first when taking out insurance. In fact, they’re more than twice as likely as pet owners in New York—second only—to have pet insurance. It may be because California and New York are among the most expensive places to live in the United States.
These states are also responsible for the first and third highest percentage of U.S. gross domestic product, respectively, and are among the top states for the average net worth of their residents. Basically, on average, Californians and New Yorkers can afford it, but of course, they’re not the only ones. Other US states where residents are most likely to insure their pets are New Jersey, Texas, Massachusetts, Pennsylvania, Washington, Colorado and Illinois.
This story originally appeared on ManyPets
and was produced and distributed in partnership with Stacker Studio.