By FintechOS · August 29, 2022
5 minute read

Pet insurance report: the potential of the pet cover market

female dog owner signing per surgery consent form

The pet insurance market could be worth nearly USD 17 billion by 2030. In our new report, “Harnessing the untapped potential of the growing pet insurance market, we examine the current state of the sector, and the many opportunities available to insurers.

The market for pet insurance is only gaining momentum and presents an eventful landscape for insurers who want to offer a truly unique or value-add service to customers. However, brands must be careful with what they’re offering, and not just cobble together another set of generic insurance options, because the market is already saturated with such products.

An opportunity for pet insurers

A report from Allied Market Research reveals that the pet insurance market is expected to see significant growth over the next 10 years. In 2020, the global pet insurance market was worth USD 4.5 billion. By 2030, experts expect to see the market take a sharp increase, reaching USD 16.8 billion.

Recent global events are only making the likelihood of this prediction more of a reality. Due to the coronavirus pandemic and multiple enforced lockdowns, people found themselves spending all their time at home and able to take on the responsibility of owning a pet for the first time.

Statistics focusing on UK pet owners delivered some telling numbers on the matter: in the years directly before the pandemic (2018/2019), 40% of British households owned a pet. At the height of the pandemic in 2020/2021, that number had grown significantly to 59%. Now, in 2022, 62% of British households include a pet.

Pet ownership became so popular during the coronavirus pandemic that the average price for a puppy doubled, with typical costs for a dog sitting at about GBP 2,000. While the pandemic was the catalyst for this change, new ways of hybrid working and the ongoing use of home offices mean that even though there’s optimism around the pandemic being largely over, people still have more time at home and, therefore, for their pets.

Surprisingly, despite the drastic increase in pet ownership, the vast majority of pet owners in the US and UK still do not hold pet insurance for their animals. Research reveals that 86% of British and 98% of American pet owners do not hold insurance.

The vast majority of pet owners claim their reason for not taking out pet insurance is simple – they cannot afford it. However, when examined further, this argument starts to crumble.

Within our pet insurance report, average costs of routine and emergency pet procedures are examined. With some non-life threatening treatments costing several thousand dollars, and many Americans having less than USD 300 in savings, many pet owners face incredibly difficult choices when their pet needs costly treatment.

Insurers should highlight to potential customers the concrete affordability of paying a modest monthly sum for their pet’s protection, rather than having to panic and secure funds or face a grim reality.

Unfortunately, for some pet owners, the consequences for not taking out pet insurance can be life or death. In far too many situations, veterinarians have to turn away pets and their owners who cannot afford treatment, and it’s not at all unusual for owners to opt for economic euthanization instead of treatment.

Economic euthanization occurs when an animal is put down because treatment could not be afforded, even though the pet could likely go on to live a happy and normal life after the treatment.

This presents a unique opportunity, and considerable challenge, for insurers. While there is clearly an opening in the market to create valuable pet insurance products, insurers will have to convince customers that plans are worthwhile and affordable.

Our pet insurance report investigates this in-depth and delivers tangible solutions for brands hoping to offer products with a punch.

Innovation and disruption in the pet insurance market

For brands that are keen to join the pet insurance revolution, there are plenty of innovative examples already being set by progressive insurers.

The pet insurance report examines brands like Lemonade, AB Lassie, Embrace, and more. All of these brands are working to offer products that add value to the lives of pets and their owners, fill a market gap, or lend an enjoyable and forward-thinking technological experience for users.

If your insurance brand is planning to launch pet insurance products, or beginning to feel that perhaps you should be, there’s a lot to consider. Creating an alluring offering for customers in today’s market will require a creative blend of personalization, data, technology, and partnerships.

Including the combination of these elements in a new product will help insurers find success as they venture into the pet insurance market. Customers are seeking not only an experience that adds value, but also added benefits, such as perks with partner brands, a seamless digital experience, and a hyper-personalized approach that makes them feel like an important customer.

To discover the full potential of the pet insurance space, read our full report.

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