U.S. Pet Insurance Market Size, Share & Trends Analysis Report By Coverage (Accident & Illness, Accident Only), By Animal (Dogs, Cats), By Sales Channel (Agency, Broker), By States, And Segment Forecasts, 2025 - 2030

U.S. Pet Insurance Market Size & Trends

The U.S. pet insurance market was valued at USD 4.99 billion in 2024 and is projected to grow at a CAGR of 20.98% from 2025 to 2030 to reach a market valuation of USD 15.71 billion. The increasing disbursement of insurance claims, the rise in underwritten policies, the increase in veterinary care costs, initiatives by key companies, and the evolution of regulatory structures are critical drivers of this market.

One of the primary drivers of this market is the substantial increase in the annual gross written premium (GWP) of pet insurance, which indicates the increasing adoption of pet insurance among pet owners across the country. According to the North American Pet Health Insurance Association's (NAPHIA) State of the Industry (SOI) 2024 report, the GWP has increased substantially by more than 35% from 2019 to 2023. The GWP was valued at around USD 1.5 billion in 2019, which rose to more than USD 3.9 billion by 2023. This highlights the massive demand for viable insurance plans that can cover veterinary fees among pet owners in the country

Furthermore, the need is also highlighted by the staggering amount of disbursed insurance claims for pets. According to NAPHIA SOI reports, the highest insurance claim amount in dogs & cats ranged from USD 20,000 to USD 60,000 in 2023. These amounts spotlight the ever-rising veterinary care costs driving pet owners to opt for insurance covers.

For instance, an April 2024 article published in USA Today highlighted the Bureau of Labor Statistics reports regarding more than a 7.9% price rise in urban veterinary services within just a year, i.e., between 2023 and 2024. Furthermore, it was noted that urban pet care costs have seen 11% in the last 2 years and nearly 60% over the previous decade. The organization also conducted a survey, known as "USA Today Blueprint," among the country's veterinary industry participants. This survey indicated that 91% of participant pet owners experienced financial stress due to high veterinary care costs. Another poll conducted by Forbes Advisor inferred that 63% of pet owners struggle with unexpected vet bills, and around 42% showcased a willingness to incur debts to pay these bills. These factors indicate a rising demand for pet insurance amidst increasing veterinary costs and corroborate the high growth in GWP in the country over the last few years.

However, some recent developments in the market may hamper its growth. For instance, in June 2024, one of the largest pet insurance providers in the country, Nationwide Mutual Insurance, announced the cancellation of more than 100,000 pet insurance policy coverage and will not be eligible for renewal. The company cited rising veterinary care costs as one of the leading reasons for this decision. Such developments create uncertainty for pet owners towards pet insurance providers, which may prove to be deteriorating for the market in the future.

Market Concentration & Characteristics

The market is expected to witness high innovation. Traditional insurance companies are improving their offerings by incorporating wellness programs and tailoring plans to individual needs, while new companies are using digital platforms to improve customer experience. Partnerships with veterinary networks are enhancing the reach of services. The market is intensely competitive, with growth and transformation being driven by strategic actions such as launching new policies, forming partnerships, and undertaking mergers and acquisitions. These developments position pet insurance as an essential aspect of conscientious pet ownership.

Regional Expansion is a competitive arena involving domestic and international companies. Each employs different strategies to capture a more significant portion of the market. Trupanion Inc., Nationwide Mutual Insurance, and Jab Holding Company have emerged as important players, held substantial market shares and expanded from the U.S. to other major regions, especially in the European industry.

The market is characterized by a high level of mergers and acquisitions in recent years. Apart from other industry participants, this can be specifically attributed to the acquisition spree by the investment holding company Jab Holding Company. For instance, in November 2023, Jab Holding Company acquired one of the leading pet insurance companies in the U.S., Embrace Pet Insurance, for USD 1.5 billion.

The entry of more prominent companies into the pet market is expected to rise the competition further. In January 2024, Embrace Pet Insurance reached a milestone of insuring around 500,000 pets nationwide. With pet owners increasingly recognizing the benefits of pet insurance, many new providers with their business models have started to seep into the market, increasing the impact of substitutes. But, in contrast, targeted acquisition sprees by investment firms like Jab Holding Company may function as a catalyst in reducing the substitutes in the market in the near future.

The National Association of Insurance Commissioners (NAIC) helps regulate the industry in the U.S. by providing expertise, data, and analysis for insurance commissioners. The association's Pet Insurance Model Act was adopted in 2022 to address critical elements of pet insurance plans, such as pre-existing conditions, consumer protection, pet wellness programs, and training for insurance producers. Furthermore, legislators in the U.S. are currently forming regulations to control the price of veterinary care and pet insurance. For instance, according to AVMA, in September 2024, the U.S. Congress introduced new bipartisan legislation intending to manage the costs of veterinary care and pet insurance. The bill proposed that the pet and service animals’ expenses be considered under tax-advantaged health savings accounts (HSA) and flexible spending accounts (FSA).

Coverage Insights

By coverage, the accident & illness segment dominated the market with an 86.32% share in 2024 and is expected to grow at the highest CAGR of more than 21% over the forecast period. The growth in this sector is primarily driven by the high costs of veterinary treatments and diagnostics, an expanding population of companion animals, and heightened awareness about the benefits of pet insurance. Pet insurance companies predominantly offer accident and illness policies, which cover a wide range of conditions, including acute and chronic illnesses, medications, and diagnostic tests. With these policies providing extensive coverage to pet owners, this segment is anticipated to grow at the fastest rate in the coming years.

The other segment, comprising liability insurance policies, is projected to experience lucrative growth over the forecast period. The boost can be attributed to the growing importance of this type of insurance, which covers any property damage caused by the pet and safeguards the pet owner from severe financial losses.

Animal Insights

By animal, the dogs segment held the highest market share of 81.36% in 2024. This can be attributed to the high adoption of insurance among dogs as pets nationwide. After the outbreak of the COVID-19 pandemic, having pets at home became a significant trend. This is highlighted in a January 2024 article by Forbes Advisor, where it is indicated that more than 65.1 million households have dogs, a substantial difference compared to 46.5 million households having cats. In addition, the growing emphasis on pet health and the high costs of veterinary healthcare are anticipated to boost the market's growth further. Major diseases and disorders reported in dogs include rabies, parvovirus, kennel cough, heartworm, diabetes, and cancer.

The cats segment is expected to grow at the fastest CAGR of more than 18% over the forecast period. This growth rate is primarily due to the increasing adoption of pet insurance in recent years. NAPHIA SOI 2024 reports highlight this fact by stating that in the U.S., from 2022 to 2023, the GWP for cats rose by 26.3% compared to dogs, which rose by only 20.9%. This high growth rate, coupled with increasing cat adoption, is a testament to the growing willingness of cat owners to take out insurance for their cats.

Sales Channel Insights

By sales channel, the direct sales channel segment held the highest share of the market at 34.82% in 2024. This channel is the simplest and easiest method of buying pet insurance. The ease of obtaining insurance is a significant driver for this segment. In addition, insurance costs are lower when compared with other distribution channels due to the absence of agents and brokers. The digital and direct channels have higher transparency than others, increasing consumer trust. The reason is the high reliance on direct sales strategies by leading pet insurance companies. For instance, Trupanion, a leading pet insurance provider in the U.S., in its 2023 annual report, stated that the majority, i.e., more than 70% of its revenue was generated from its subscription/direct-to-customer pet insurance service named Furkin & PHI Direct.

The other segment, which contains animal care centers, veterinary clinics, and more, is expected to grow at the fastest rate of over 21.97% during the forecast period. This can be attributed to providers forging multi-pronged partnerships with companies from various sectors to enhance pet benefits and penetrate a larger market. For instance, in January 2024, Nationwide Pet Insurance partnered with one of the leading pet care product retailers, Petco, to launch a customizable pet health insurance plan for the latter's customers. This plan covers various animal species like dogs, cats, pet birds, exotic animals, reptiles, and rodents.

State-level Insights.

California Pet Insurance Market

California accounted for the largest share of the market in 2024 and is expected to maintain its dominance over the forecast period. The reason behind state dominance lies in two main factors: the pet population and the dynamic regulatory scenario. The state is home to more than 18% of the country's pet population, and state legislators are actively improving pet insurance laws to safeguard pet owners against unfair business practices. For instance, in September 2024, the governor of California approved a bill named SB 1217, under which pet insurance providers must disclose policy terms, including coverage limits, exclusions, and pre-existing condition clauses. Such laws will boost the uptake of pet insurance as they will increase transparency in state pet insurance policies.

Florida Pet Insurance Market

Florida is set to exhibit the highest growth rate due to a rapid rise in GWP and insured pets among all the other states in the country. According to NAPHIA, the state recorded an increase of more than USD 100 million in total GWPs in just 2 years. Also, the number of pets insured rose by more than 100,000 between 2021 and 2023.

Key U.S. Pet Insurance Company Insights

Companies in the U.S. pet insurance market are focusing on different aspects of pet illness and accident coverage. The market is projected to mature with increased competition and claims processing volume. In addition to established companies, new startups and insurtechs are entering the market to offer innovative pet insurance schemes. The pandemic also increased the demand for pet insurance due to heightened risk protection awareness among pet parents.

The market is witnessing significant activity, including strategic initiatives such as new policy launches, partnerships, mergers, acquisitions, and regional expansions to gain a larger market share.

Recent Developments

• In September 2024, the SEC directed a former executive of Chewy to pay USD 35,275 for settling insider trading charges for using confidential information to buy shares in a pet insurance company, Trupanion, during partnership negotiations between the two in 2021.

• In August 2024, in a Series A funding round, Companion Protect, an insurance company, raised over USD 20.25 million from investors like Avanta Ventures, Liberty Mutual Insurance, Old Republic International Corporation, and Stray Dog Enterprises.

• In May 2024, Unum Group launched Unum Pet Insurance to provide comprehensive pet health coverage. The company took this step to address the rising demand for well-rounded pet insurance. Nationwide will underwrite the company.

• In May 2024, Plymouth Rock Home Assurance partnered with Fetch Pet Insurance to launch comprehensive health protection for both homes and pets. This unique combination provides pet owners with benefits in both home and pet insurance plans.

• In April 2024, Chubb announced the acquisition of Healthy Paws, a U.S.-based pet insurance agent, to enter the country's pet insurance sector.

• In February 2024, Odies Pet Insurance partnered with Tigerless Insurance to provide pet insurance services to international communities in the U.S.

• In November 2023, Synchrony Financial divested its pet insurance subsidiary, Pets Best, towards Independence Pet Holdings, intending to achieve financial goals.

• In September 2023, Independence Pet Group (IPG), a prominent pet insurance platform offering comprehensive services, acquired Felix, the sole pet insurance brand exclusively catering to cats in the U.S.

• In August 2023, Global Risk Partners (GRP) entered the pet insurance market in the UK by acquiring Petsmedicover, a pet insurance broker trading as VetsMediCover. Following the acquisition, VetsMediCover will become part of Insync Insurance, a digital broker GRP acquired in December 2020.

• In July 2023, Nationwide launched its over 40+ years of pet health data in the form of a PetHealthZone database. This step provided insights into veterinary practice waiting rooms and enabled pet owners to make informed decisions about their pets' health. This database provides personalized health information and helps identify potential health risks for pets.

• In July 2023, Pets Best expanded its partnership with Jab Holding Company to enhance customer-per-insurance service offerings and streamline processes within the industry.

 U.S. Pet Insurance Market Report Scope

U.S. Pet Insurance Market Report Segmentation

This report forecasts revenue growth at country and state levels and provides an analysis of the latest industry trends in each of the sub-segments from 2018 to 2030. For this study, Grand View Research has segmented the U.S. pet insurance market report based on coverage, animal, sales channel, and states:

• Coverage Outlook (Revenue, USD Million, 2018 - 2030)

  • Accident & Illness

  • Accident only

  • Others

• Animal Outlook (Revenue, USD Million, 2018 - 2030)

  • Dogs

  • Cats

  • Others

• Sales Channel Outlook (Revenue, USD Million, 2018 - 2030)

  • Agency

  • Broker

  • Direct

  • Bancassurance

  • Others

• State Outlook (Revenue, USD Million, 2018 - 2030)

  • California

  • New York

  • Florida

  • Texas

  • New Jersey

  • Pennsylvania

  • Massachusetts

  • Washington

  • Illinois

  • Other States