Facts + Statistics: Pet Ownership and Insurance

Pet Insurance

There are many things to think about when you get a new pet. You have to pick out the perfect name, buy enough food and toys, and of course find a place for them to sleep. One thing that may not be at the top of your list is pet insurance, but it should be. Vet bills can add up quickly, and pet insurance can help you pay for them.

There are many different options for pet insurance, so it's important to do your research before signing up. Some policies only cover accidents, while others cover routine care as well. You also need to decide how much coverage you want and what deductible you're comfortable with.

If you're on a tight budget, pet insurance may not be right for you. But if you can afford it, it's a good way to protect yourself from high vet bills. 

The pet insurance industry began just over a century ago in Scandinavia where about half of that country's pets are now insured. In North America, Veterinary Pet Insurance, Inc., a subsidiary of Nationwide, sold its first pet insurance policy in 1982 to cover dog playing Lassie on television.

According to the North American Pet Health Insurance Association (NAPHIA), the American pet health insurance sector posted gross written premiums of $1.99 billion in 2020, a 27.5 percent increase from $1.56 billion in 2019. The market has been growing at an average annual rate of 24.2 percent from 2016 to 2020. End-of-year 2020 saw 3.1 million animals being insured.

Dogs represented 83% of in-force gross written premium in 2020. In 2020, average annual premiums reported by NAPHIA for dogs insurance plans were approximately $218 for accident-only coverage, which provides coverage for foreign body ingestion, lacerations, motor vehicle accidents, poisoning and other injuries. For accident and illness coverage, estimated annual premiums for injury-only protection and illnesses such as cancer, infections, and digestive problems were $594. For pet dogs, these values were 40 percent lower.

Twelve NAPHIA members offer insurance coverage for dogs. They are accident and illness, accident only, and health insurance plans. Forbes Advisor, Money, and U.S. News & World Report listed some of the top dog insurance providers in 2022.

Thirty percent of Americans during the COVID-19 pandemic adopted the pet, as reported by the Insurance Research Council's October 2020 report, Consumer Responses to the Pandemic and Implications for Insurance. Numerous pet owners chose to forego pet insurance, as per Liberty Mutual Insurance. The company's study indicated that nearly three-quarters of animal owners do not have pet insurance.

Pet Ownership in The United States

Seventy percent of American households, or about 90.5 million families, own pets, based on the 2021-2022 National Pet Owners Survey conducted by the American Association of Pet Product Distributors (American Pet Products Association, APPA). This was up from 56 percent of households in 1988, the first year the survey was taken, and 67 percent in 2019.

Number of U.S. Households That Own a Pet, by Type of Animal

Pet	Number
Dog	69.0
Cat	45.3
Freshwater Fish	11.8
Bird	9.9
Samll Animal	6.2
Reptile	5.7
Horse	3.5
Saltwater Fish	2.9

Source: American Pet Products Association's 2021-2022 National Pet Owner Survey.

Total expenditure by the American pet sector in 2019 reached $103 billion, up 6.7 percent from $97.1 billion recorded in 2019. The American Pet Products Association projects that the expense in 2021 will attain $109.6 billion.

Total U.S. Pet Industry Expenditures, 2010-2020 (1)

($ billions)

Year	Expenditure (2)
2010	$48.4
2011	51.0
2012	53.3
2013	55.7
2014	58.0
2015	60.3
2016	66.8
2017	69.5
2018	90.5
2019	97.1
2020	103.6

Source: American Pet Products Association's National Pet Owners Surveys.

Basic Annual Expenses for Dogs and Cats (1)

Expense	Dog	Cat
Surgical Vet	$458	$201
Food	287	254
Routine Visit	242	254
Kennel Boarding	242	178
Food Treats	81	72
Vitamins	81	47
Toys	56	41
Groomer/Grooming Aids	47	31

Source: American Pet Products Association's 2021-2022 National Pet Owners Survey.