Pet Insurance: The Growing Niche You Should Be Part Of

Agency Height
6 min readDec 9, 2019


Picture this-you’re playing fetch with your dog, and you’re both having a great time. In its excitement to retrieve the toy for you, it jumps into a thorny bush. By the time you get to him, it’s too late. He’s injured his eye and is visibly in pain. You rush him to the vet and discover that his eye treatments are going to cost a pretty penny. Unfortunately, you don’t have pet health insurance, so now you have to deal with the expensive vet bills out of your pocket.

To avoid such unpleasant situations, millions of Americans are now opting for pet insurance. Insurance for pets is a relatively small segment of the insurance industry. Yet, a growing craze for cats and dogs means that it’s one sector that insurance agents should keep an eye on. But before getting into the details, let’s see what pet insurance is first.

What is pet insurance?

Pet insurance is an insurance policy which helps reduce the cost of veterinary bill. The insureds can opt for pet health insurance, which can cover expensive veterinary costs in part or in full. It can help with emergencies as well as the yearly costs of pets. Pet owners can purchase pet health insurance to reduce their out-of-pocket expenses. It’s a way to be able to afford more expensive treatments for their animals.

Now you might be thinking why you, as an insurance agent, should care about pet insurance. It’s such a small sector of the insurance industry, and most people would be concerned about their health insurance. The stats beg you to reconsider.

Millions of pets, millions of pet insurance opportunities

The American Pet Products Association revealed that around two-thirds of U.S. households own pets. The most commonly held pet is freshwater fish since they are the least demanding. Following that lead are cats and dogs. A survey by APPA revealed that Americans owned 94.2 million cats and 89.7 million dogs in 2018.

Americans aren’t just taking in more pets- they are treating them as a prized part of the household. An increasing number of people are treating pets, especially cats and dogs, less like animals, and more like members of the family. Americans, especially Millennials, are labeling themselves as “pet parents” to their “fur babies.” Their spending habits reflect this.

The numbers speak for themselves.

Pet owners spent a whopping $72.56 billion on their pets in 2018 alone, which is a new record. That’s a $3 billion increase from 2017 and a $6 billion increase from 2016. To put that into perspective, around two decades ago, in 1996, Americans had spent a relatively conservative $21 billion on their pets.

These days, people are willing to get their pets’ premium food, provide them the best daycare, and bring them along everywhere they go. So, it’s not surprising that such dedicated pet owners are increasingly looking for pet insurance. Pet insurance is turning into a market that you shouldn’t ignore.

According to the North American Pet Health Insurance Association, Americans insured around 2.43 million pets by the end of 2018. That is a 17.1% increase from 2017. While only 1 to 2 percent of pets have insurance so far in the U.S., this sector is witnessing tremendous growth. Since an increasing number of people are treating their pets like their own family, this number is expected to grow.

For any insurance agent, the niche but booming sector of pet insurance is worth checking out. But where do you begin? Who are the right people to target, and what is the best policy for them?

Target millennials

Surprisingly, millennials are the largest pet-owning demographic. This generation has been under fire for “killing” many industries, but this doesn’t hold when it comes to pets. Millennials are the most significant class of pet owners for all types of pets, including exotic animals and birds like owls and snakes that weren’t “pet material” in the past.

More than any other generation, millennials treat their pets, especially dogs and cats, as irreplaceable members of their family. The sentimental value they put on their pets is much more than any other generation that preceded them. One reason for this might be because millennials are having fewer babies.

Millennials prefer pets over babies

The Centers for Disease Control and Prevention reported that the birthrate in the U.S. hit record-low numbers in 32 years. For the first time, women in their 20s are being overtaken by women in the 30s when it comes to giving birth. Raising children is expensive, and millennials are struggling financially due to student loan debts and rising costs of rent and housing.

To many millennials, it makes more sense to get a dog or cat than having a baby. Figures have shown that millennials prefer dogs slightly more than cats. Over 80% of pet-owning millennials and Gen Z own dogs. Dogs have become extremely “humanized” by this generation.

Dog insurance holds the lion’s share

Pet insurance, especially dog insurance, is established and even mandated in many parts of Europe, and the U.S. is catching up. According to NAPHIA’s annual report, the total Gross Written Premium for pet health insurance was $1.3 billion in America. That’s a 24% increase from 2017. Out of that, dog insurance represented approximately 88.9% of Gross Written Premium in 2018. It might be because dogs are prone to developing diseases like cancer, stomach issue, and skin issues that are expensive to treat.

There is an argument about whether pet health insurance is even worth it. Critics of the pet health insurance policy argue that both fear and love drive most purchases. They insist that buying pet insurance policies like dog insurance could end up costing more when taking years of payment into account. Yet, many pet owners never expect urgency when their vets diagnose their pets with life-threatening illnesses.

Pet insurance is worth it for pet owners

Petplan, a pet insurance company from Philadelphia, stated that the average cost of an unanticipated vet visit ranged from $800 to $1500. The 2018 Report on the Economic Well-Being of U.S. Households noted that most Americans wouldn’t be able to cover a cost that high. If they needed to cover a surprise expense of $400, 27% of adults would have to borrow or sell something, while 12% wouldn’t be able to cover it at all.

Pet insurance could protect against such events that could wreak havoc on the average American’s budget. According to the APPA, a pet owner gets a vet bill of $1000 every six seconds. No matter how much pet owners humanize their pets, they will follow their animal instincts in the end. They will chase, bite, and chew things, which can end in accidents. If a dog accidentally swallows something, removing it can cost upward of $5000.

Pet insurance can help reimburse 90% of such unanticipated vet bills. Healthy Paws Pet Insurance sites examples of a German shepherd that needed a $52,000 treatment against tetanus exposure, and a cat that got a $4,600 hip replacement. Pet owners are more likely to prefer having insurance rather than dealing with such steep and unexpected expenses.

Research by Global Market Insights has projected the global pet insurance market revenue to exceed $10 billion by 2025. The demand for pet insurance, especially dog insurance, is quickly growing. The availability of new pet insurance policies to match the increasing pet penetration rates is a crucial factor fueling this trend. Whether you are a genuine pet lover, or you are an insurance agent looking to make the most of a growing niche market, you should look into the pet insurance industry.

#insurance #insuranceagents #insuranceagency #petinsurance #doginsurance

Daniel Schreiber Justin Farrell Byrne Hobart Save This Life

Originally published at on December 9, 2019.



Agency Height

Agency Height is an insurance blog that offers insurance agents content about the insights and queries of the industry to make their work more efficient.