Pet Insurance
By Sue C. Quimby, CPCU, AU, CIC, CPIW, CLP, DAE – Senior Vice President
Pet ownership continues to grow, especially since the Covid-19 pandemic. During the pandemic, people were forced to spend more time at home, and many continue to work remotely. The American Pet Products Association (APPA) advises that pet ownership in the United States grew 4.7% in the decade from 2009-2019. In the two years after the start of the pandemic (2020-2022), ownership jumped 9.77%. According to an APPA National Pet Insurance Survey from 2021-2022, 70% of American homes – or approximately 90.5 million – included pets. Caring for these family members can be expensive. Pet insurance is one way to help manage these costs. Helping clients understand the exposures and coverages involved with pet insurance is another value-added service of the professional insurance agent.
In 2013, Americans spent $55.7 billion dollars on their pets. In 2023, this number was $147 billion. Pet food and treats accounted for $64.4 billion; $32 billion was spent on supplies, live animals and over the counter medicine; $38.3 billion went toward vet care and product sales; and $12.3 billion was expended on other services (boarding, grooming, insurance, training, pet sitting and walking and all services outside of veterinary care). A MetLife survey of dog and cat owners determined that the average family spends $4,800 per year on their pet(metlifepetinsurance.com).
Companion animals come in all shapes and sizes, and so does pet insurance. This type of insurance is not just for dogs and cats. Coverage is also available for more exotic pets, such as birds, iguanas, opossums, pot-bellied pigs and sugar gliders. Given the high cost of purchasing and caring for these pets, the decision to buy insurance is certainly worth consideration. Veterinary visits in New York State average $77 –highest in the nation – according to pettable.com. Marketwatch.com estimates a monthly cost for pet insurance in New York of about $77. This is about 16% higher than the average cost across the United States.
In addition to accidents and illnesses, coverage may be obtained for hereditary/genetic conditions, surgery, testing, hospitalizations and medications. In the case of congenital conditions, advancements in science mean that conditions that were once fatal are now treatable. As with human health, regular preventative care can help to avoid or reduce expensive medical bills down the road. For this reason, coverage for routine care may be a preferred option. Some plans provide a maximum annual benefit, while others have an unlimited option. A variety of deductibles and copays is also available.
Coverage varies among programs. It is important to review provisions of each plan carefully. While some are more expensive, the extra cost may be worth it if the animal is injured or becomes ill. While not all plans cover routine care, there are plans that offer a flexible health savings account for such things as annual checkups, heartworm medication, teeth cleaning and vaccinations. Most policies cover accident and illness, with more programs starting to offer coverage for genetic conditions. Some programs even provide coverage for the cost of cancelling holiday or vacation plans due to a pet’s illness or injury, as well as cremation costs. The expense of alternative therapies and rehabilitation may also be included in the policy.
Eligibility requirements vary. For example, some programs have age limits, and others require that the pet be spayed/neutered. There may be a waiting period for coverage to become effective. At least one plan has a 12-month waiting period for hip dysplasia.
To many of us, pets are important family members. The cost of care, especially in an emergency, can be significant. Buying pet insurance may help to control these expenses and give pet owners peace of mind. Helping clients understand the benefits and options available to pet owners for pet insurance is another sign of the true insurance professional.
This article is for educational and discussion purposes only and it is not insurance or legal advice and should not be relied upon when making insurance or legal decisions. Nothing herein shall be construed to constitute a legal or underwriting opinion. Nothing herein shall be construed as offering any political, social, or public policy opinion by the author or MSO. Neither the author nor MSO are responsible for errors in, or the accuracy or currentness of, the article.
