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.
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.
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).
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%, totalling 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 the pets, but have been unsuccessful. The best option that pet owners have to safeguard their pets is to get a theft or straying insurance cover 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.
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
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 size value in 2020||US$57.811 billion|
|Market size value in 2027||US$84.996 billion|
|Growth Rate||CAGR of 5.66% from 2020 to 2027|
|Forecast Unit (Value)||USD Billion|
|Segments Covered||Animal Type, Policy Type, And Geography|
|Regions covered||North America, South America, Europe, Middle East and Africa, Asia Pacific|
|Companies covered||Nationwide Mutual Insurance Company, Metlife Inc., Healthy Paws Pet Insurance, LLC., Crum & Foster, Trupanion, Petplan Limited, Embrace Pet Insurance Agency, LLC, Animal Friends Insurance, Petsecure Pet Health Insurance, 24PetWatch|
|Customization scope||Free report customization with purchase|
Frequently Asked Questions (FAQs)
Q1. What is the size of the global pet insurance market?
A1. Pet Insurance Market was valued at US$57.811 billion in 2020.
Q2. What will be the global pet insurance market size by 2027?
A2. The pet insurance market is expected to reach a market size of US$84.996 billion by 2027.
Q3. What are the growth prospects for the global pet insurance market?
A3. The global pet insurance market is expected to grow at a CAGR of 5.66% over the forecast period.
Q4. How is the global pet insurance market segmented?
A4. The pet insurance market has been segmented by animal type, policy type, and geography.
Q5. What factors are anticipated to drive the pet insurance market growth?
A5. The global pet insurance market is likely to increase in the following years, owing to the increasing veterinary healthcare prices.
Nationwide Mutual Insurance Company
Crum & Foster
Embrace Pet Insurance Agency, LLC
Animal Friends Insurance
Petsecure Pet Health Insurance
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