Is Offering Pet Insurance A Good Business Venture?
If you own a business that caters to pet owners, there may have been a time when you considered offering pet insurance, but let’s be honest. On the list of ways to grow your revenue, adding pet insurance to your product offerings probably didn't seem like the strongest contender. But that is all changing. We know that insurance can feel complicated, so we’re here to uncomplicate the issue and explain how offering pet insurance is actually a substantial revenue opportunity and something that would resonate with your customers.
1. The Market for Pet Insurance is growing
Right now is an opportune time to offer pet insurance because the pet owner market is rapidly and steadily growing. According to the 2021-2022 American Pet Products Association's (APPA), over 70% of American households now include at least one pet, and among the roughly 130 million pets in the U.S., over 75% of them are not insured. With annual vet costs averaging over $1000, the market for offering pet insurance is ripe.
In the U.S., gross written premiums for pet insurance have grown by double-digit percentages every year since 2016. In 2020, the total U.S. volume hit almost $2 billion. By offering pet insurance, you would be able to tap into that growth and create a massive recurring revenue stream for your business. As an added bonus, as someone early to this trend, you would have a larger pool of potential new customers and a leg up on your competition.
2. Pet insurance provides significant value to your customers
The cost of vet care is rising in the U.S. Americans spend over $32 billion annually on veterinary care, and roughly one-third of American pets will need to visit an emergency vet each year—with average costs ranging from $800-$1500. With most Americans unable to cover an unexpected $800 cost, surprise vet bills can be a serious issue.
If you own a pet adoption center, online vet services company, pet services provider like doggy daycare, or a pet product subscription company, you are in the perfect position to maximize this opportunity to help your customers. Because pet insurance is a natural complement to your business, offering it as an embedded product would be a seamless and valuable experience for your customer. By offering insurance when they purchase other related products, you make it easier for them to access the protection they need. Additionally, that kind of reliability and forward-thinking is a great way to increase their brand loyalty—by applying your knowledge of their needs and purchase behavior, you can craft a compelling package to address their concerns.
3. the Insurance Landscape is Evolving
Historically, insurance has been a one-size-fits-some kind of offering. There are limited packages available, and everyone just has to pay for the package even if it includes services they do not want or not enough of what they truly need. But that is changing. Now, you can offer pet owners the ability to pick and choose additional services to tailor their coverage to their needs. To cater to the modern pet owner, insurance transactions and setup are entirely digital and easy. With the right insurer, a pet owner can complete their application in minutes and then rest easy knowing that their pet is protected.
Insurance doesn’t have to be complicated for you or your customers. When you are in the know, ahead of the curve, and prepared to offer your customers a service that will protect their pets and their wallets, the revenue will follow. The market is right for this great business venture. If you are interested in learning more, get the 2022 Guide to Growing Your Revenue with Embedded Pet Insurance and check out Boost’s service offerings.
Not fully convinced? You can request a demo and learn more in a one-on-one demo with a Boost product specialist. Opportunity is waiting for you.