Picking the right policy is important because not all policies cover everything
of ConsumerAffairsAuto and homeowneraren't the only type of insurance that's in growingdemand and price. Pet insurance is also getting pricer.
There's more demand because pet owners are facing high vet bills and are turning to pet insurance, making it a booming industry.
In 2024, pet insurance premiums reached$3.4 billionby September and likely totaled$4.5 billionby year-end, according to a new market report.
Why Pet Insurance is Expanding
- Vet Costs Are Rising: Veterinary prices increased8.24%from 2023 to 2024, following similar jumps in previous years.
- More Pets: U.S. households now own87.9 million dogsand73.8 million cats, increasing demand for vet care.
- Strong Growth: Pet insurance premiums have more than doubled since 2019, with at least20% annual growth.
Market Insights
- 10 Companies Dominate: The top 10 pet insurers control90%of the market.
- Profitability Varies: Some insurers are profitable, while others struggle with high claims costs.
- Nationwides Policy Drop: The largest U.S. pet insurer, Nationwide,cut 100,000 pet policiesdue to rising veterinary costs.
Different animals, different rates
But just like with homeowners and auto insurance, rising vet billsare causing premiums to rise. While some industry estimates put the average rate increase at $1 a month each year for dogs and 50 cents for cats, that doesn't tell the whole story.
Rates are based on the pet's age, since older animals may have more healthcare needs. Also, rates could be higher for some breeds.
While many pet owners will tell you that having insurance on their pet saved a lot of money, you should ask the same sort of questions you would when shopping for any type of insurance. The California Department of Insurance offers these questions:
- Does the coverage offered have exclusion for preexisting conditions? If so, what exclusions?
- Does the coverage exclude costs for treatment of a hereditary disorder?
- Does the coverage exclude costs for a congenital anomaly or disorder, which means a condition that is present from birth?
- Is there a deductible or coinsurance clause that causes any claim reimbursement to be reduced by a set amount?
- Will the renewal premium be increased if a claim is made? If so, by how much?
- Is there a basis for reimbursement or formula for payment for veterinary services other than the actual amount of the billed services?
Photo Credit: Consumer Affairs News Department Images
Posted: 2025-01-29 21:39:17
