Pet Insurance Market Set for Strong Expansion
The global pet insurance market is on track for substantial growth, with projections indicating a compound annual growth rate (CAGR) of 12.92% through 2033. This expansion would see the market grow from a valuation of $5.21 billion this year to an estimated $13.77 billion in 13 years.
According to a recent report by Market Data Forecast, the market was valued at $4.61 billion in 2024. A key driver of this growth is the Asia-Pacific (APAC) region, which is emerging as a significant market due to rising disposable incomes and a growing emphasis on pet healthcare. China and India, specifically, are witnessing increased pet adoption rates, contributing to the market’s expansion.
Accident & Illness plans currently dominate the market, accounting for over 80% of policies. These plans offer comprehensive coverage for various conditions, including chronic and hereditary issues. The increasing demand for these comprehensive policies is fueled by rising veterinary costs, making insurance a more attractive option for pet owners.
Digital sales channels, including company websites and mobile applications, are becoming increasingly important, representing over 30% of policy purchases. This shift toward digital platforms reflects broader trends in consumer behavior and provides convenient access to pet insurance products.
Challenges and Market Dynamics
Despite the positive outlook, some challenges remain, particularly in emerging markets. Low adoption rates in some areas stem from high veterinary costs and a limited range of insurance options. Additionally, a lack of standardized reimbursement processes and complicated policy terms can hinder market expansion. The high cost of premiums can be a barrier for some pet owners, and older pets and breeds predisposed to health problems often face higher premiums.
Market Share and Segmentation
In 2024, dogs accounted for 51.8% of the global pet insurance market share, attributed to their prevalence and higher healthcare expenses. Cat insurance is expected to grow at a CAGR of 7.78%, due to an increase in urban pet ownership and greater awareness of feline health coverage.
Accident & Illness policies continued to be the dominant segment in 2024, holding 82.12% of the market share because of the comprehensive protection these plans offered. Accident-only policies remain a niche market, appealing to owners of younger, healthier pets seeking more cost-effective coverage options.
Direct sales accounted for 42.3% of the market in 2024, driven by increased digital adoption. The agency segment continues to cater to pet owners who prefer more personalized service, while veterinary clinics and pet stores are now becoming alternative sales channels.
