Global Pet Insurance Market Size, Share, Opportunities, COVID-19 Impact, And Trends By Animal Type (Dog, Cat, Others), By Policy Type (Lifetime Cover (Illness Cover, Accident Cover), Non-Lifetime Cover (Illness Cover, Accident Cover)), And By Geography - Forecasts From 2022 To 2027

The pet insurance market is projected to grow at a CAGR of 5.66% during the forecast period to reach US$84.996 billion by 2027, from US$57.811 billion in 2020.

Introduction

Pet insurance is a protection policy that mostly covers veterinary healthcare for a person’s sick or wounded pet. Insurance companies may compensate for a part or all of the cost of the pet’s healthcare treatment, depending on the policy. Some policies also cover costs if the pet gets stolen or lost, or even dies. 

Market Trend:

The global pet insurance market is likely to increase in the coming years, owing to increasing veterinary healthcare prices. The increasing trend of pet adoptions and pet purchases during the COVID-19 pandemic will also play a vital role in the pet insurance market. Europe currently holds the largest market share in the pet insurance industry. Sweden currently holds the largest market share in Europe, with almost 90% of pets having reported pet insurance coverage.

However, North America has been regarded as the fastest-growing market in recent years, with rapid advancements in the pet insurance market. NAPHIA recently revealed many industry achievements in North America, including a remarkable US$2.174 billion in total pet health insurance premiums sold in 2020 (up to over 26% from $1.717 billion in 2019) and over 3.45 million pets covered across the region (up by 22.5% from over 2.81 million pets insured in 2019).

Growth Factors

• An increase in veterinary healthcare costs

With the increasing adoption and purchase of pet animals, the veterinary healthcare industry has also become substantially more expensive. Knee replacements, sophisticated allergy testing, cancer treatments, and chiropractic therapy, which were previously exclusively available to humans, are now available to dogs and cats. According to the American Pet Products Association's (APPA) annual state of the industry report, pet expenditure in the United States hit US$103.6 billion in 2020, up by 6.7% from the previous year. Of that amount, US$ 31.4 billion was used for veterinary healthcare, which accounted for an increase of about 7.2% from the previous year. With the increasing cost of veterinary healthcare, people have started to understand the significance of pet insurance. This is consequently expected to drive up the demand for pet insurance.

Moreover, pet owners have seen a significant increase in instances of dog theft. According to information released under the Freedom of Information Act by Direct Line Pet Insurance, thefts have increased by 13%, totaling 2,670 instances in 2021 in the UK. This has been recorded as the highest number of thefts in the last seven years. Government agencies have tried releasing guidelines to safeguard pets, but have been unsuccessful. The best option that pet owners have to safeguard their pets is to get theft or straying insurance coverage that would policy the cost of the loss of a pet.  Increases in pet theft are expected to drive up the pet insurance market as well.

Restrain

• Increasing policy prices

Pet insurance prices have been increasing rapidly over the past few years. Veterinary treatments have advanced to the point that veterinarians can now diagnose and treat pet ailments with much more accuracy than ever before. However, these treatments come at a price, and they will unavoidably affect pet insurance premiums. Moreover, some insurance providers are a lot more careful about their financial decisions and want to generate as much revenue as possible. Some of them are more active in raising their rates than others, and they are willing to risk losing clients as a result.

Furthermore, even if a pet is currently in perfect condition and has never filed a claim, the pet’s insurance premiums may rise. As animals grow older, the likelihood of them being ill increases, raising the cost of insurance. Since pets live for a shorter amount of time on average than humans, it may seem that they are afflicted with more ailments and succumb to them sooner. 

Recent Development and Expansion

• JAB Holding Company and Fairfax Financial Holdings Limited announced a strategic partnership in June 2022, in which JAB's pet insurance business agreed to acquire all of Fairfax's interests in the Crum & Forster Pet Insurance GroupTM and Pethealth Inc., including their global operations. The core mission of the company is to provide the leading health and well-being ecosystem for pets by offering affordable, comprehensive pet products and brands throughout a pet's lifecycle.
• JAB announced its acquisition in October 2021: Figo Pet Insurance. This acquisition will propel them to the forefront of the North American tech-driven pet insurance ecosystem.
• JAB announced its majority stake acquisition of UK insurer BNP Paribas Cardif's pet insurance division Cardif Pinnacle in October 2021. The combination of BNP Paribas Cardif's global partnership know-how and strong technical capabilities derived from extensive experience, combined with JAB's expertise in establishing world-class brands and platform building, positions them ideally to become a leader in the growing pet healthcare industry.
• Zoetis entered the pet insurance market in April 2020 by launching Pumpkin Insurance Services Inc., a pet insurance agency with offices across the United States. Pet parents can take advantage of the company's affordable pet health insurance and preventive care plans.
• MetLife, Inc. acquired PetFirst Healthcare, LLC, a companion animal health insurance administrator, in December 2019. This acquisition allowed MetLife to expand its offerings, leveraging the company's position as a leader in group benefits distribution channels in the United States.

COVID-19 Impact on the Pet Insurance Market

The COVID-19 pandemic had a positive impact on the pet insurance market. Due to the government-imposed lockdowns and social distancing norms, most pet owners were forced to keep their pets at home. This led to a decrease in the number of diseases and pet insurance claims. Pet insurance companies also allowed certain relaxations and price reductions in policy premiums to help pet owners during these tough times. However, since so many people were purchasing pets during the coronavirus pandemic in 2020, pet prices skyrocketed. Because the cost of a cat or dog affects their insurance rate, the average pet insurance premium is likely to grow further in the next couple of years.

Market Segments

• By Animal Type
  • Dog
  • Cat
  • Others
• By Policy type
  • Lifetime Cover
    • Illness Cover
    • Accident Cover
  • Non-Lifetime Cover
    • Illness Cover
    • Accident Cover
• By Geography
  • North America
    • USA
    • Canada
    • Mexico
  • South America
    • Brazil
    •  Argentina
    • Others
  • Europe
    • Germany
    • France
    • United Kingdom
    • Spain
    • Others
  • Middle East and Africa
    • Saudi Arabia
    • Israel
    • South Africa
    • Others
  • Asia Pacific
    • China
    • Japan
    • South Korea
    • India
    • Indonesia
    • Thailand
    • Taiwan
    • Others