Voluntary pet insurance continues to grow
Nearly two-thirds of Americans (62%) have at least one pet in their household, according to Harris Poll, with the numbers highest among millennials (65%) and Gen Xers (71%). An increasingly younger workforce, combined with 95% of employees viewing their pets as family, may explain why pet insurance offered as a voluntary benefit continues to grow in popularity.
In 2016, 9% of organizations offered pet health insurance, a 5% jump since 2011, according to research from the Society for Human Resource Management.
“Pets over the last decade have gone from backyard to bedroom in terms of role in the family,” say Scott Liles, president and chief pet insurance officer for Nationwide, the nation’s largest pet insurer. “That in our estimation is the single largest driver in adoption of pet insurance as a voluntary benefit. What people are willing to spend on their pets.”
Pet owners spent nearly $16 billion on veterinary care in 2016, according to American Pet Products Association. “Since [nearly three-in-five] Americans own at least one pet, two-thirds of employees may be shouldering sizable pet care costs. Pet insurance can help employees offset these veterinary expenses," Liles explains.
Crum & Forster Pet Insurance Group is also seeing increased demand, particularly from smaller employers, explains Liz Watson, chief marketing officer of the Akron, Ohio-based company. “Smaller companies are starting to add it because they know it is a competitive marketplace and have to attract and retain employees,” she says.
The product is becoming “sexy” for employers and brokers to offer, Liles adds. “It’s new, it’s fresh, it’s something think is interesting and makes a difference particularly for younger employee populations,” he says. As of today, nearly half of all Fortune 500 companies offer pet insurance from Nationwide to their workforce.
“Understanding the important role pets play in the lives of your employees and enabling them to provide the best care possible for their furry family will set employers apart as compassionate, modern and smart,” says Cynthia Short Trumpey, senior vice president, pet acquisition, at Healthy Paws Pet Insurance in Seattle.
It is popular as a voluntary product because it often contains an employee discount, Trumpey adds.
Liles predicts continued growth, “not just from employers, but also from folks who had the opportunity to buy this for a couple years and they hesitated,” he says. “We will see them start to buy.”
He also predicts a continued diversification of companies offering the product. “While you think of a Google or Disney or other forward-learning companies,” he explains of companies offering voluntary pet insurance, “it is [now] a lot of mainline companies, old industrials, [etc.]. You look at this and say this has become the norm.”