Pet Insurance in North America, 4th Edition

Date: November 22, 2010
Pages: 196
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US$ 3,300.00
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Publisher: Packaged Facts
Report type: Strategic Report
Delivery: E-mail Delivery (PDF)
ID: PF2E366D6B3EN
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Pet Insurance in North America, 4th Edition
Now in its fourth edition, Packaged Facts’ Pet Insurance in North America is the most comprehensive examination of the U.S. and Canadian pet insurance markets available and a must-have for any company interested in this dynamic industry. Although sales growth slowed due to the recession, revenues (measured as gross written premiums) remained in the double digits in 2009 while delivering a 2005-2009 compound annual growth rate of 21%. Packaged Facts expects the North American market for pet insurance to continue to chart strong annual increases over the next five years, with the high level of competitive activity helping to offset the slow economic recovery and ongoing challenge of communicating the value of pet health insurance to budget-watching consumers.

As of 2010, industry pioneer Veterinary Pet Insurance (VPI) continues to lead the market. However, both the U.S. and the Canadian pet insurance markets have experienced significant market share shifts during the past five years as more than a half dozen new companies have come onto the field. Each of these companies brings with it unique strengths, in some cases including potent co-marketing affiliations with powerful brands (e.g., PetPartners and the AKC, PurinaCare with its own famous name), and in other cases including important retail channel thrusts (e.g., PetFirst with Kroger and Petfinder.com, and Trupanion with Petco). The industry is also seeing more investment backing and large insurance companies coming into the market as underwriters, including Aon with Healthy Paws, Aetna with Pets Best, and Berkshire Hathaway with PurinaCare.

Based on primary research including interviews with every leading pet insurance provider in North America, this latest edition of Packaged Facts’ groundbreaking 2003 report offers a road map for competing in this market both now and in the years ahead. All of the top players are profiled in depth, including VPI, Pethealth, Hartville (ASPCA), Western Financial/Petsecure, PetFirst, PetPartners (AKC), Vetinsurance/Trupanion, Pets Best, Embrace, Fetch (Petplan USA) and PurinaCare. Statistics provided include historical and projected market revenues, number of policies in force, and company shares (both U.S. and Canadian), along with profiles of pet owners and pet insurance purchasers, based on data from sources including Experian Simmons, The American Pet Products Association, and Packaged Facts own consumer surveys.
CHAPTER 1: EXECUTIVE SUMMARY

Introduction
  Scope of Report
  Report Methodology
    Market Analysis
    Consumer Analysis
Market Size and Composition
  North American Market Growth Continues
  Looking Ahead
  Figure 1-1: North American Pet Insurance Market Revenues: United States, Canada, Total, 2005, 2009, 2014 (in millions of U.S. dollars)
  Number of Policies in Force
  Veterinary Chanel Feels Recessionary Pinch But Retains Upward Curve
Competitive Overview
  Top North American Marketers
  Figure 1-2: Estimated Share of North American Pet Insurance Market by Company, 2005 vs. 2009 (percent)
  Market Share Shifts
  Competitive Trends
Consumer Trends
  Pet Ownership Overview
  Figure 1-3: Household Ownership Rates for Selected Pet-Owning Classifications, 2010 (percent of U.S. households)
  Pet Owners and Insurance

CHAPTER 2: MARKET TRENDS

Introduction
  Market Definition
    Equine Insurance Excluded
  Range of Coverage
  Typical Restrictions
  Gross Written Premiums and Conversion Rates
Market Size and Composition
  North American Market Growth Continues
  Table 2-1: North American Pet Insurance Market Revenues: United States, Canada, and North America, 2005-2009 (in millions of U.S. dollars)
  Figure 2-1: Share of North American Pet Insurance Market: United States vs. Canada, 2002-2009 (percent)
  Number of Policies in Force
  Figure 2-2: North American Pet Insurance Market: Number of Pet Insurance Policies in Force, 2005-2009
  Share of Policies by Animal Type
  Figure 2-3: Share of U.S. Pet Insurance Market Revenues by Animal Type, 2009 (percent)
Market Outlook
  Recession Takes a Toll
    A Stuttering Recovery
    Pet Owners Not Immune to Economic Downturn
  Figure 2-4: Level of Agreement with Statement “I Am Spending Less on Pet Products These Days Because of the Economy,” 2010 (percent of U.S. pet owners)
  Table 2-2: Economic Outlook of U.S. Pet Owners: Now vs. Last 12 Months (percent)
  Figure 2-5: Level of Agreement with Statement “I Anticipate Spending More on Pet Products Over the Next 12 Months,” 2010 (percent of U.S. pet owners)
  Table 2-3: Economic Outlook of U.S. Pet Owners: Now vs. Next 12 Months (percent)
  Veterinary Chanel Feels Recessionary Pinch But Retains Upward Curve
  Figure 2-6: Percentage of Dogs and Cats Given Medication and/or Drugs: 2000-2008 (percent)
  Table 2-4: Veterinarian Visits, Expenses and Services Received, 2008 (number, percent and dollars)
  Table 2-5: Average U.S. Household Expenditures on Veterinary Services, 1998-2008 (in dollars)
  Veterinarians Lining Up Behind Pet Insurance
  Figure 2-7: Percentage of Veterinarians Who Actively Recommend Pet Insurance, 1997-2009
  Figure 2-8: Percentage of Veterinarians Who Would Like to See Wider Use of Pet insurance by Year of Veterinary School Graduation
  Consumer Awareness/Trade Support/Media Coverage Up
  North American Pet Health Insurance Month
  Improving PR
  North American Pet Health Insurance Association (NAPHIA)
  Schwarzenegger Axes California Pet Insurance Bill
  Human/Animal Bond a Potent Force
  Figure 2-9: “Consider My Pet(s) Part of the Family”: By Percent of Pet, Dog/Cat, Dog and Cat Owners, February 2009 (percent)
  Table 2-6: Mean Number of Veterinary Visits: By Human/Animal Bond Among Dog and Cat Households, 2006
  Table 2-7: Mean Veterinary Expenditures: By Human/Animal Bond Among Dog and Cat Households, 2006 (in dollars)
  Growing Populations of Dogs and Cats
  Table 2-8: Number of Dogs and Cats in the United States: 2000, 2002, 2004, 2006 and 2008 (number in millions and percent)
  Figure 2-10: Dog or Cat Ownership Rates by Age Bracket: 2003 vs. 2010 (percent of U.S. households)
  Internet Popularity Among Pet Owners a Plus
  Table 2-9: Level of Pet Owner Agreement with Statement: “I Use the Internet to Help Find and Choose Pet Products,” February 2010 (percent)
  Table 2-10: Level of Pet Owner Agreement with Statement: “I Buy Pet Products Online,” February 2010 (percent)
  Table 2-11: Selected Internet-Related Psychographics: Adults Overall vs. Dog or Cat Owners, 2010 (percent and index)
  Impact of Aging Pet Population
  Figure 2-11: Percentage of Dogs and Cats Age 6 and Over: 1996 vs. 2006 (percent)
  Impact of Pet Overweight, Obesity
  Table 2-12: Percentage and Number of Overweight and Obese Dogs and Cats, 2009
  Increased Competition/Channel Expansion
  Shift Away from Credit Usage Bodes Well
  Table 2-13: Credit Card Ownership and Usage: By Frequency, 2005-2010 (percent)
  Looking Ahead
  Figure 2-12: Projected North American Pet Insurance Market Revenues: United States, Canada, and North America, 2009 vs. 2014 (in millions of U.S. dollars)

CHAPTER 3: COMPETITIVE OVERVIEW

Market Share Trends
  Top North American Marketers
  Figure 3-1: Estimated Share of North American Pet Insurance Market: By Company, 2005-2009 (percent)
  Figure 3-2: Estimated Share of U.S. Pet Insurance Market: 10 Companies, 2009 (percent)
  Figure 3-3: Estimated Share of U.S. Pet Insurance Market: By Company, 2005-2009 (percent)
  Figure 3-4: Estimated Share of Canadian Pet Insurance Market: By Company, 2005-2009 (percent)
  Market Share Shifts
  Table 3-1: North American Marketers of Pet Insurance, October 2010
Competitive Trends
  A New Ball Game
  Figure 3-5: Cumulative Share of North American Pet Insurance Market Revenues: Over 5% Share Companies vs. Under 5% Share Companies, 2005-2009
  Differentiation to the Fore
  The Underwriting Advantage
  Company Snapshot: PurinaCare Insurance Services, Inc.
  Table 3-2: PurinaCare Monthly Ultimate Premiums Estimate, June 2008-November 2009 (in dollars)
  Enter Healthy Paws—and Aon
  Next Up: PetSafe
  More International Cross-Over
  Internet More Important Than Ever
  The Company Benefits Thrust
  Competition from Alternative Payment Options
    CareCredit
  Pet Assure
  Banfield
  Other
  Looking Ahead

CHAPTER 4: COMPETITOR PROFILES

Competitor Profile: Embrace Pet Insurance
  Background
  Company Positioning
  Recessionary Adjustments
Competitor Profile: Hartville Group, Inc
  Company Overview
  Types of Plans
  Management Shakeup Yields Growth
  Company Voluntarily Delists Stock
  ASPCA Venture Going Strong
  Illustration 4-1: ASPCA Pet Insurance Ad in Veterinary Practice News (June 2010)
  Hartville Premiums Up in 2009
  Figure 4-1: Hartville Group Gross Written Pet Insurance Premiums, 2001-2009 (in millions of dollars)
    Number of Active Policies at Approximately 120,000
  Figure 4-2: Hartville Group Number of Active Pet Insurance Policies, 2001-2009
  Ongoing Strong Consumer Focus
  Increased Focus on Veterinary, Company Benefits Channels
Competitor Profile: PetFirst Healthcare LLC
  Company Overview
  Company Strategy
    Focus on Simplicity
    More Choices
    Ramping Up Online
  The Kroger Connection
  The Petfinder.com Connection
  The Home Again Connection
  Expansion in Company Benefits Arena
Competitor Profile: Pethealth, Inc.
  Company Overview
  Revenue Growth
  Table 4-1: Pethealth Revenues, 2001-2009 (in millions of Canadian dollars)
  Pet Insurance Operations
    Brokers
    Underwriting
    U.K. Market Entry
    EVE Online Claims Processing
  North American Pet Insurance Performance
  Table 4-2: Pethealth Pet Insurance North American Gross Written Premiums, 2001-2009 (in millions of U.S. dollars)
  Table 4-3: Number of Pethealth Pet Insurance North American Policies in Force, 2001-2009
    United States v. Canada
  Table 4-4: Share of Pethealth Pet Insurance North American Gross Written Premiums: U.S. vs. Canada, 2005-2009 (percent)
  Pet Insurance Programs and Marketing
  Non-Insurance Operations
  PetPoint Shelter Management Software
  24PetWatch Pet Registry Services
  Petango.com
Competitor Profile: PetPartners, Inc.
  Company Background
  AKC and CFA Policy Types
  AKC and CFA Program Marketing
  Illustration 4-2: AKC Pet Insurance Ad in AKC Family Dog (April/May 2010)
  Company Launches PetPartners “Gemstone Brand,” Expands into Company Benefits Arena
  New Partner Programs
Company Profile: Petplan USA (Fetch, Inc.)
  Company Overview
  The U.K. Connection
  The HSUS Connection
  Media Focus
  Illustration 4-3: Promotional Banner for Fetch Magazine
  Illustration 4-4: Petplan Print Ad: Bark Magazine (May/June 2009)
Competitor Profile: Pets Best Insurance Services
  Company Overview
    The AVMA GHLIT Partnership
  Product Positioning
  Illustration 4-5: Pets Best Ad in Animal Wellness (December/January 2010)
  Channel Focus
  Affinity Relationships
  Illustration 4-6: ChaseHealthAdvance and Pets Best Joint Marketing Ad (May 2009)
Competitor Profile: Veterinary Pet Insurance Co.
  Company Overview
    Company Realigns with Focus on Consumer Advocacy
    Commitment to Benefit Schedule
    Belief in Indemnity Insurance
    Adherence to Regulation
  A New Product Roster
  Emphasizing Wellness Care
  2009 Revenues of $184 Million
  Table 4-5: Veterinary Pet Insurance Gross Written Premium 1998-2009 (in millions of dollars)
  Advertising Spending and Themes
    “That’s a Good Human” Campaign Launched
  Illustration 4-7: VPI Print Ad: “That’s A Good Human” Campaign
  Public Relations Mix “Fun Facts” with Pet Health Tips
  Web-Based Marketing and Support
  The Iams Connection
  Veterinary Channel Remains VPI Focus
  Industry Leader in Voluntary Benefits Arena
Competitor Profile: Vetinsurance International (Trupanion)
  Company Background
  Trade Approach
  Trupanion Plus Petco
  Consumer Approach
  Illustration 4-8: Trupanion Trade Ad (Veterinary Practice News, June 2010)
  Policy Changes
  Trupanion Online
  Cause Marketing
Competitor Profile: Western Financial Insurance Company
  Company Background
    Western Financial In
    Petplan Out
  Pet Insurance Brands and Channels
    Most Recommended Brand in Veterinary Channel
    Adoptsecure Offered in Shelter Channel
  Premiums, Policies Continue Upward Trend
  Table 4-6: Western Financial Pet Insurance Gross Written Premiums, 2003-2009 (in millions of U.S. dollars)
  Table 4-7: Western Financial Pet Insurance Number of Active Policies, 2005-2009
  Company Launches Value-Priced Option: Petset
  Hbc Brand Launched in 2008
  PurinaCare Canada
  PC Financial Brand Targets Loblaw Supermarket Crowd
  CAA Brand Reserved for Auto Club Members
  Strategic Alliances
  Public Relations and Cause Marketing

CHAPTER 5: CONSUMER TRENDS

Pet Ownership Overview
  Methodology and Data Sources
  52% of Households Keep Pets
  Figure 5-1: Household Ownership Rates for Selected Pet-Owning Classifications, 2010 (percent of U.S. households)
  Table 5-1: Household Penetration Rates for Selected Dog- or Cat-Owning Classifications, 2005, 2007, and 2010 (percent of U.S. households)
  Overall Demographics for Dog Owners
  Regional Skews by Number of Dogs Owned
  Overall Demographics for Cat Owners
  Household Composition Skews by Number of Cats Owned
  Table 5-2: Demographics for Dog Ownership, 2010 (percent, number of households, and index)
  Table 5-3: Selected Demographics for Keeping One Pet Dog, 2010 (percent, number of households, and index)
  Table 5-4: Selected Demographics for Keeping Two or More Pet Dogs, 2010 (percent, number of households, and index)
  Table 5-5: Demographics for Cat Ownership, 2010 (percent, number of households, and index)
  Table 5-6: Selected Demographics for Keeping One Pet Cat, 2010 (percent, number of households, and index)
  Table 5-7: Selected Demographics for Keeping Two or More Pet Cats, 2010 (percent, number of households, and index)
Pet Owners and Insurance
  APPA Consumer Surveys Show Rise in Pet Insurance Ownership Rates
  5% of Dog Owners With a HH Income of $60K+ Carry Pet Insurance
  Figure 5-2: Prime Demographics for Purchasing of Dog Insurance, 2008 (percent of U.S. dog owners)
  Cat Insurance Usage Rates Show Opposite Pattern by HH Income
  Figure 5-3: Pet Insurance Ownership Patterns by Household Income: Dog Owners vs. Cat Owners, 2008 (percent of U.S. dog or cat owners)
  Vets Are Most Important Source for Pet Insurance Awareness
  Figure 5-4: Sources from Which Dog or Cat Owners Become Familiar with Pet Insurance, 2010 (percent)
  37% of Dog/Cat Owners Are Not Familiar with Pet Insurance Policies
  Figure 5-5: Levels of Familiarity with Pet Policies Among Dog or Cat Owners Who Do Not Carry Insurance, 2010 (percent)
  Top Reasons for Not Having Pet Insurance Policies
  Figure 5-6: Reasons for Not Carrying Pet Insurance: Dog or Cat Owners, 2010 (percent)
  Table 5-8: Demographic Characteristics for Purchasing of Dog Insurance, 2008 (percent of U.S. dog owners)
  Table 5-9: Top Demographic Characteristics Favoring Purchasing of Cat Insurance, 2008 (percent of U.S. adults)

APPENDIX: COMPANY ADDRESSES
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