Pet Insurance

pet dog and woman in nature

In 2017, pet parents in the United States owned more than 393 million animals, nearly 184 million of which were cats and dogs. At some time in their lives most, if not all, of these pets will need medical care, whether that be spaying or neutering, routine physical exams and immunizations, or more specialized care. Veterinary care is expensive. Pet owners reported paying an average of $182 per year for routine exams for cats and $257 for dogs. Average surgical costs climb into the hundreds, with some types of specialized care, such as chemotherapy for cancer or cataract surgery, costing thousands of dollars. Add to that the cost of medications and some pet parents may need to spend upwards of several hundred to several thousand dollars a year to keep their pets healthy. Overall, in 2018, pet parents spent an estimated $18.26 billion on veterinary care in the U.S., up from $17.07 billion in 2017. Knowing that pet health care is expensive, an increasing number of pet parents are buying pet insurance policies.

Today’s market size shows the total amount of premiums paid for pet health insurance in 2013 and 2017 and projected for 2022 in the United States. The first animal insurance policy was written in Sweden in 1890. At the time, coverage focused on horses and livestock. In the United States, TV star Lassie received the first pet insurance policy in 1982. By 2017, 1.83 million pets were insured, a 17.5% increase from the year before. An overwhelming majority of policies, 98%, were accident and illness plans or insurance with embedded wellness plans. Premiums for accident and illness plans averaged $516 per year. The other two percent were accident-only policies, with premiums averaging $181 per year. In North America, 88.9% of policies provide coverage for dogs.

The pet health insurance market will continue to grow according to a report1 by the research firm Packaged Facts. Insurance companies’ use of their websites and social media for marketing as well as partnerships with veterinarians, animal shelters and breeders are expected to increase consumer awareness of insurance offerings and discounts. The use of technology to handle customer interactions more efficiently as well as expanding coverage to pets other than cats and dogs will also contribute to future growth in the industry according to the report.

1 Pet Insurance in the U.S., 6th Edition

Geographic reference: United States
Year: 2013, 2017 and 2022
Market size: $499.8 million, $1.03 billion and $2 billion, respectively
Sources: State of the Industry Report 2018 Highlights, North American Pet Health Insurance Association, April 2018 available online here; “Five Trends That Will Double The U.S. Pet Health Insurance Market by 2022,” Veterinary Practice News, October 6, 2018 available online here; “Pet Industry Market Size & Ownership Statistics,” American Pet Products Association available online here; “History of Pet Health Insurance,” North American Pet Health Insurance Association available online here; Grace Schneider, “Pet Insurance Company Success is Off the Leash,” USA Today for the Lansing State Journal, February 27, 2019, page 3B.
Image source: Seaq68, “nature-friends-dog-pet-woman-suit-3042751,” Pixabay, December 27, 2017 available online here.

Dog Walking Services

dog walkingAccording to the 2017-2018 APPA National Pet Owners Survey, 84.6 million households in the United States own a pet. This equates to 68% of all U.S. households, up from 56% thirty years earlier. The total number of pet dogs exceeds the number of pet-owning households by 5.1 million. Many households are caring for multiple dogs.

Owners spent more than $66.7 billion dollars on their pets in 2016. Spending for 2017 was expected to increase by nearly $3 billion. Most people who own pets consider them part of the family. Their spending reflects that attitude. Besides spending on the basics such as food and healthcare, many owners spend money on pet services such as grooming, boarding, pet sitting and dog walking. In 2016 owners spent a total of $5.76 billion on all types of pet services and were expected to spend even more in 2017.

Today’s market size shows the total amount earned by professional dog walkers in 2017. There were 27,838 dog walking businesses in the United States employing 28,576 people, according to IBISWorld.

Geographic reference: United States
Year: 2017
Market size: $1 billion
Sources: “Dog Walking Services in the US: Market Research Report,” IBISWorld, September 2017 available online here; “Pet Industry Market Size & Ownership Statistics,” American Pet Products Association Press Release available online here.
Image source: robynhobson, “park-dog-walk-entrepreneur-606334,” Pixabay, January 1, 2000 available online here.

Alternative Pet Care Services

With the slow economy, many Americans are cutting back on spending in many areas of their lives. Among pet owners, spending on pets does not seem to be one of these areas. In 2012, pet owners spent $53 billion on pet food, veterinary care and other pet-related services, up 5 percent from 2011. Included in this spending was alternative veterinary care services such as acupuncture.

Today’s market size shows the amount spent by pet owners in the United States on alternative veterinary care in 2012.

Geographic reference: United States
Year: 2012
Market size: $12.5 billion
Source: “Los Angeles: Americans Spent $53B on Pets in 2012,” Lansing State Journal, February 24, 2012, page 5A.
Original source: USA Today
Posted on February 26, 2013

Veterinary Services

According to the American Pet Products Association, 62% of households in the United States (72.9 million) owned at least one pet in 2011. From 2006 to 2011, the price of veterinary care increased 46%. Data show the amount pet owners spent on veterinary services in 2011. This was slightly more than 25% of all pet-related spending by pet owners. In 2012, spending on veterinary care is expected to rise to $13.6 billion.

Geographic reference: United States
Year: 2011
Market Size: $13.4 billion
Source: “Industry Statistics & Trends,” American Pet Products Association, available online here and ASPCA Pet Health Insurance: New Member’s Guide to Coverage, 2012.
Posted on September 18, 2012

Veterinary Services

A sleepy looking Katie the Beagle

The downturn in the U.S. economy has not spared many but there is always some variation in how such a sharp economic slowdown hits some industries versus others. Veterinarians are among those who often see their base business less impacted than others. While dealing with declining revenues in 2009, veterinary service providers saw a decline of only 0.6% between 2008 and 2009. Of the 27 5-digit NAICS (North American Industrial Classification System) industries in the professional services sector, the veterinary services industry was one of four that saw revenues decline by 0.6% or less between 2008 and 2009. Many other professional service providers saw revenues decline by 15% or more.

Today’s market share is based on the estimated revenues earned by veterinary service providers in the United States in 2009.

Geographic reference: United States
Year: 2009
Market size: $25.64 billion
Source: “Table 6.1. Professional, Scientific, and Technical Services (NAICS 54) – Estimated Revenue for Taxable Firms: 2001 Through 2009,” page 1 and 2 of an extract from Service Annual Survey: 2009, available online here.
Original source: U.S. Bureau of the Census
Posted on August 30, 2011

Pets in Japan

Today’s market size is an estimated size for the pet care sector in Japan. This is a measure of the market for all products and services related to household pets. In Japan, one third of this market is made up of pet food. As in the United States, the pet sector is growing strongly in Japan. However, based on a calculation of population to estimated pet dog and cat numbers, fewer than half as many Japanese households have a dog or cat as a pet as U.S. households.

Geographic reference: Japan
Year: 2009
Market size: ¥1.2 trillion (approximately $12.96 billion based on the exchange rate on December 31, 2009)
Source: “At ¥1.2 Trillion, Pet Sector Recession-Proof,” The Japan Times Online, October 28, 2010, available online here.
Original source: Fuji Keisai Company

Dog and Cat Food

Dog Food

The market for pet care products in the United States is quite large and according to one study, by the firm Packaged Facts, pet food represented only 33.6% of that overall market in 2008, down from 35.1% of the market in 2004. The market sizes presented here are not retail sales figures. They are figures based on the value of manufacturers shipments, thus closer to wholesale prices.

Geographic reference: United States
Year: 2007 and 2008
Market size: $13.5 billion and $15.9 billion respectively
Source: Annual Survey of Manufactures 2008, March 30, 2010, available online here.
Original source: U.S. Bureau of the Census