While 1-in-3 U.S. consumers adopted or considered adopting a pet during the pandemic, most decided against purchasing coverage for their new furry family member, according to a survey from Liberty Mutual Insurance, which also found nearly three-quarters of animal owners do not have a pet policy.
This low level of pet insurance adoption is despite high awareness for these types of plans, with 67% of consumers saying they know about pet policies.
Despite this, some are predicting big things for the pet insurance market, with projections of annually compounded growth of 7% through 2027.
“We actually see pet insurance as where the medical insurance market was for people 40 years ago,” Chris Blatchly, chief digital officer and consulting leader for insurance at Cognizant, said during an AM Best webinar. “Not only is it a market we think will grow significantly, [but] we think it is a great opportunity for insurance companies to advance their digital agendas and employ technologies that they can use for more conventional insurance in the future.”
Vet bills more than doubled in the past decade
“It is no surprise we saw pet adoption rates increase as Americans had more time in their homes amid the pandemic lockdowns, and hopefully we’ll see many more family connections made on National Adopt a Shelter Pet Day,” Luke Bills, Liberty Mutual chief product officer, global retail markets U.S., said in a release. “We often hear how surprised people are when they see their vet bill after an accident, illness or even a wellness appointment, but these costs could be greatly reduced with pet insurance.”
Concerning Bills’ final point, nearly two-thirds of pet owners said they could not afford an unexpected vet bill. Driving some of that is a general lack of awareness of the rising costs of veterinary care, as Liberty Mutual found around half of pet owners were unaware that vet bills have more than doubled during the past decade.