Pet Insurance Technology Improvements Imperative to Underpin Booming US Market

Bosses at leading Anglo-American pet insurance technology specialists, Aquarium Software Inc., have welcomed the news that pet insurance growth in 2014 in the US was (according to The Seattle Times on November 17, 2014) triple the pace of accident and health coverage, with a warning that the growth may not be sustainable without the correct technology platforms underpinning it. What is already a $600 million industry (The Seattle Times, November 17, 2014) looks set to expand again in 2015, and there should be nothing to stop and even accelerate this premium growth, should enabling technology be seen as a driver – rather than a cost – says Aquarium.

The unprecedented expansion of the industry continues to confound the experts, but has come about in tandem with the rising cost of vets’ bills as new treatments are developed, which has coincided with pets gradually and definitely being moved from the doghouse to form a key part of the family unit. While such economic and social evolution is good for pets and business, the industry needs the tools to cope with this demand, and software is undoubtedly the key.

“Aquarium has been pointing out for some time that the pet insurance industry has untapped potential in the US due to the growth in pet parents’ need for protection from unexpected vets’ bills,” said Mark Colonnese, Aquarium’s VP Sales and Marketing. “While the market is better established in Europe, the concept of pet insurance is now being taken more seriously around the world. The one thing that unites Europe and America is the need for providers to raise their game. Policy holders expect the same high standard from pet policies as from traditional insurance products and technology is the only way to deliver.”

It is clear that investors are starting to sniff out the potential of pet insurance. According to data compiled by the North American Pet Health Insurance Association(NAPHIA), in their State of the Industry Benchmarking Report of July 7, 2014, gross written premiums jumped an average of 13% from 2009-13, compared to just a 3.5% rise in premiums for personal accident and health policies (data by Timetric) in the US in the same period and investors are getting in on the act. According to an article published in Bloomberg on November 13, 2014, last yearFairfax bought Pethealth for $88 million, starting a process of consolidation as big brands seek greater brand recognition and market share – a process likely to continue in 2015, as the market is conservatively estimated to be worth (according to an article by California Department of Insurance on September 30, 2014) around $750million in the US in 2015.

Reprinted from Insurance News Net