The pet insurance market is projected to grow significantly, reaching $38.3 billion by 2033, according to Allied Market Research.

This growth is driven by an increase in pet ownership, rising veterinary care costs, and advancements in pet healthcare technology.

Allied Market Research recently published a report titled “Pet Insurance Market by Policy Coverage, Animal Type, and Sales Channel: Global Opportunity Analysis and Industry Forecast, 2024-2033.” The report reveals that the pet insurance market, valued at $10.1 billion in 2023, is expected to grow at a compound annual growth rate (CAGR) of 14.5% from 2024 to 2033.

The rising number of pet owners and their willingness to invest in pet healthcare are major factors contributing to the market’s expansion. Pet humanisation and the strong emotional bonds between pet owners and their pets further drive this trend. Additionally, the high costs of veterinary care for chronic and acute illnesses make pet insurance an attractive option, particularly for accident and illness policies.

Policy Coverage: Leading Segments

By policy coverage, the accident-only segment held the largest market share in 2023, accounting for nearly four-fifths of the global revenue. This segment is expected to maintain its leadership during the forecast period due to the increasing acceptance of pet insurance and rising treatment costs. Accident-only policies offer a cost-effective way to avoid large, unexpected veterinary bills.

However, the “others” segment, which includes coverage for a variety of pets such as turtles, is projected to exhibit the highest CAGR of 18.4% from 2024 to 2033. This growth is driven by the diversification in pet types and improvements in pet insurance policies.

By animal type, dog insurance held the highest market share in 2023, contributing to nearly four-fifths of the global revenue. This dominance is attributed to dogs being the most preferred pets worldwide and their significant maintenance costs, which increase the demand for pet insurance. The “others” segment, which covers various other pets, is expected to grow at the highest CAGR of 19.3% from 2024 to 2033. This growth is spurred by the rising costs of veterinary care, making pet insurance more appealing to pet owners.

Sales Channels and Regional Insights

By sales channel, the agency segment led the market in 2023, accounting for more than two-thirds of the global revenue. This trend is expected to continue, driven by the increasing number of pet owners in North America and Europe. Factors such as pet humanisation and growing awareness of pet health contribute to this demand.

The “others” segment, which includes direct-to-consumer sales and other innovative channels, is projected to grow at a CAGR of 17.5% from 2024 to 2033. Advancements in pet healthcare technology, such as telemedicine and wearable devices, are creating new opportunities for pet insurance providers.

Regional Market Dominance

Europe dominated the pet insurance market in 2023, accounting for around two-fifths of the global revenue. The region is expected to maintain its leadership status through 2033, driven by the high adoption rates of pets in the UK, Italy, France, Russia, and Germany. European insurance companies are increasingly offering diverse policy coverage options to encourage pet adoption, including plans for illnesses, injuries, and various diseases.

The Asia-Pacific region is anticipated to witness the fastest growth, with a projected CAGR of 18.6% from 2024 to 2033. The growing awareness of pet care and pet insurance during the COVID-19 lockdowns has contributed to this growth. India, with an estimated pet population of 32 million growing at 12% annually, is a key market. In August 2022, InsuranceDekho partnered with Future Generali India Insurance Company to offer unique dog health coverage, further driving the industry’s growth in the region.