Pet Insurance- A Way of Showing Your Unconditional Love for Furry Friends

The human-animal bond has always been an important one, so strong and undeniable. People all around the world love their pets unconditionally, be it dogs, cats, birds, or horses, and so treat their furry friends as an important part of the family. Being considered as a family member, it is the responsibility of humans to take good care of their pets. This is why pet insurance is getting so much popularity. Pet insurance provides illness and accident coverage for family-owned pets, primarily dogs and cats. Pet insurance policies are very similar to human health insurance policies with annual coverage offered at an actuarially-determined rate subject to various terms and conditions.

pet insurance market

The global pet insurance market is significantly growing as more and more people are owning pets across the globe. Rising awareness about pet insurance policies is also inducing people to take health and accident coverage policies for their pets as pet owners are increasingly spending on their pet’s welfare and health while cutting on expensive veterinary bills.

Global Pet Insurance Market Size, US$ Billion, 2019 and 2025

pet insurance market

Source: Knowledge Sourcing Intelligence Analysis

Following are the pet insurance policies a pet owner can choose from after checking and understanding what various policies cover and how much is the premium:

  • Veterinary fees for the cost of diagnosing and treating injuries/illnesses. This normally includes the cost of consultations, examinations, tests, medication, bandages, surgery, and hospitalization. This also includes alternative therapies like homeopathy, acupuncture, herbal remedies, and complementary treatments such as osteopathy and hydrotherapy. 
  • Third Party Liability in case one’s pet injures someone or damages someone else’s property for which the owner is legally responsible.
  • The purchase price of the pet in case it gets lost, stolen, or dies due to an injury or illness before a specified age.
  • Advertising costs in order to help find the lost pet and the cost of reward if someone finds or recovers your pet.
  • Overseas vet fees so as to pay for emergency veterinary treatment for the pet if the owner takes it abroad under the Pet Travel Scheme.

Europe is the major region constituting high number of pet owners in the region where the coverage level in European countries such as the United Kingdom and Sweden is around 30 per cent. Also, the first pet insurance policy was issued in 1890 in Sweden for horses and livestock. Later in 1924, the first pet insurance policy covering a dog was issued in Sweden. Then in the United Kingdom, the first pet insurance policy was issued in 1947. North America is also a significant regional market for pet insurance manufacturers with the North American Pet Health Insurance Association (NAPHIA) representing more than 99 per cent of the U.S. and Canada pet health insurance industry as an advocacy group. According to the NAPHIA statistics, the total premium volume for NAPHIA members in 2017 was US$1.03 billion in the U.S., representing 23.2 per cent growth from 2016 (as shown in Figure). Also, the direct premium in this country was approximately US$640 billion in 2017.

U.S. Pet Insurance Premium Volume, US$ Million

pet insurance market

Source: North American Pet Health Insurance Association (NAPHIA)

As the number of households owning atleast one pet is escalating in the Unites States and Canada, the demand for pet insurance policies is also rising. According to NAPHIA, the total number of pets insured reached 2.43 million at the end of 2018, up by over 17 per cent from 2017. Out of all animals, dogs represented nearly 88.9 per cent of in-force gross premium in 2018. As the demand for pet insurance is rising, insurance companies are also expanding into this lucrative market. According to NAPHIA, there are currently 12 major pet insurance companies in North America.

As the total expenditure incurred on pets is rising at a remarkable rate, pet owners are trying to cut the cost by purchasing pet insurance policies to some extent. According to the American Pet Products Association's 2019-2020 National Pet Owners Survey, the total U.S. pet industry expenditures has surged from US$48.35 billion in 2010 to US$72.56 billion in 2018. With unexpected vet treatment often costing a lot, it is not surprising that some pet owners, especially owning an expensive breed, want to be prepared for any unplanned medical care their furry friends need. As per the American Pet Products Association's 2019-2020 National Pet Owners Survey statistics, surgical vet accounts for the highest amount of expenditure for both dogs and cats, followed by food and routine visit. As such, people are increasingly opting for pet insurance policies so as to be protected against the unexpected costs that arise when their pets need medical treatment while helping the pet to live a longer and healthier life.

Although pet insurance is a relatively small sector of the insurance industry, it is showing signs of substantial growth as pets are becoming more integrated into people’s lives. People are seeing pet insurance policy as a way to be able to afford some of the most expensive treatments for their pets. As there is also a rise in the prevalence of diseases in domesticated animals, the global pet insurance market is set to grow at a significant growth rate in the coming years.  

With this ongoing popularity of pet humanization because of the pet companionship which provides a fundamental psychological need for many people, the demand for pet care products and services including food, grooming products, pet insurance policies, and even pet-friendly traveling services will continue to soar in the coming years.


Anjali Joshi is a senior market research analyst at Knowledge Sourcing Intelligence. She oversees a team of analysts and is known for the quality of market intelligence she delivers to the clients which range from start-ups and Non-profit Organizations to Fortune 500 companies. Anjali’s keen understanding of international business and market dynamics, coupled with her years of experience working in this industry, allows her to analyse current and future trends across both global and clients’ target markets and help them in making informed decisions.