What is the fastest growing pet product in the US? A case can be made for pet health insurance. The industry has been growing at more than 20% per year for more than 5 years. Revenues in 2022 were $3.5 billion, 23.5% higher than 2021, according to NAPHIA, the North American Pet Health Insurance Association. There are now nearly 5 million pets – mostly dogs – covered by pet health insurance.
What’s driving the growth? There are several likely factors. Veterinarians – the number one influencer – have embraced pet health insurance more enthusiastically thanks to educational efforts by NAPHIA and its members. Veterinary costs are rising due to inflation and more advanced, more expensive medical treatments. And pets owners are more emotionally attached to their animals than ever before, willing to protect their health.
Even with this rapid growth in the US market, we get asked frequently why pet insurance here isn’t as common as in many European countries. There are several reasons, but the most important is that the industries are not comparable. The US is a much more regulated insurance market; policies are sold by licensed insurance agents. Veterinarians for example, can’t sell it. In many European countries pet insurance is much more of an OTC product, similar to travel insurance here.