Europe Pet Insurance Market Size, Share & Trends Analysis Report By Animal Type (Dogs, Cats), By Coverage Type (Accidents & Illness), By Sales Channel (Agency, Broker), By Country, And Segment Forecasts, 2024 - 2030

Europe Pet Insurance Market Size & Trends

The Europe pet insurance market was estimated at USD 6.69 billion in 2023 and is anticipated to grow at a CAGR of 15.2% from 2024 to 2030. This growth is primarily fueled by the increasing number of pets, growing adoption of pet insurance in European countries, increasing initiatives by major players, and growing humanization of pets. According to the European Pet Food Industry Federation (FEDIAF), in 2022, 129.0 million cats, 106.0 million dogs, and 30.0 million small mammals were recorded in Europe. Furthermore, there were 166.0 million pet-owning homes in Europe, with at least one dog or cat owned by 25% and 27% of families, respectively. This growth in pet ownership directly correlates with increased demand for pet-related products and services, including veterinary care & pet insurance. A larger pet population provides a larger pool of potential customers for pet insurance companies, thereby driving market growth.

Pet care costs have steadily increased over the years due to various factors, including advancements in medical technology, higher demand for specialized treatments, and increasing overhead costs for veterinary practices. As a result, pet owners face escalating bills for routine check-ups, vaccinations, surgeries, medications, and emergency treatments. The affordability of these veterinary services becomes a concern for many pet owners, especially when faced with unexpected medical emergencies or chronic conditions. The study found that the human-animal link is strong, that pets benefit their owners' health, and that greater bonds are associated with better medical treatment. According to the survey, 93% of pet owners in Germany and 84% of pet owners in the UK claim to have benefited from the human-animal link in terms of their mental and physical health.

Government regulatory bodies can influence the European market by establishing favorable regulatory frameworks encouraging industry growth. For instance, in Germany, dog parents must register their dogs with the government and pay a dog tax. Dog liability insurance is mandatory in certain German states, including Berlin, Hamburg, Thuringia, Saxony-Anhalt, and Lower Saxony. Pet insurance providers such as Lassie AB offer two variants of dog liability insurance policies- either with no deductible or a deductible of EUR 150 per claim. Private stakeholders, including pet insurance companies, veterinarians, pet product manufacturers, and retail outlets, are increasingly collaborating to drive innovation and expand the reach of pet insurance products and services. Such supportive initiatives are expected to fuel the adoption of pet insurance in Europe.

Market Concentration and Characteristics

The market is rapidly innovating due to technological advancements and changing consumer demands. Companies are adopting digital tools like AI-powered claims processing, telemedicine, and mobile apps to improve customer experience and streamline operations. For instance, in May 2024, JAB Holding Company launched a global insurance platform and asset management company, with Anant Bhalla as Senior Partner and CIO. JAB, a major player in pet insurance, insures over 5 million pets and expects to generate USD 3 billion in revenue by 2024.

The market has seen significant M&A activity as companies aim to expand their presence and diversify offerings. In June 2024, Trupanion, Inc. and Boehringer Ingelheim formed a strategic partnership to enhance access to quality pet healthcare, support veterinary and consumer education, and provide innovative disease prevention and treatment solutions. This collaboration reflects a broader trend of consolidation in the industry, driven by the need to leverage established distribution networks, broaden geographic reach, and advance technological capabilities.

Regulation plays a crucial role in shaping the market. The European Insurance and Occupational Pensions Authority (EIOPA) and national regulatory bodies like the Financial Conduct Authority (FCA) in the UK set stringent standards for transparency, consumer protection, and solvency. Recent regulations such as the Insurance Distribution Directive (IDD) have mandated clearer disclosure of policy terms and conditions, enhancing consumer trust. In addition, the EU’s General Data Protection Regulation (GDPR) imposes strict rules on data handling, affecting how insurers manage and protect pet health data. Compliance with these regulations is critical for insurers operating in Europe, influencing their operational practices and shaping the competitive environment.

The market is expanding regionally, with established markets in Northern and Western Europe (e.g., the UK, Germany, Sweden) growing, while Eastern and Southern Europe (e.g., Spain, Italy) are experiencing accelerated expansion. This growth is fueled by rising disposable incomes and increasing pet ownership, with around 80 million European households owning pets, according to the European Pet Food Industry Federation (FEDIAF). In June 2023, the Association of British Insurers reported a 28% rise in claims from 2021 to 2022, though average premiums increased by only 1%. This discrepancy between rising claims and steady premiums could affect the profitability of insurers and their bargaining power. As awareness of pet insurance benefits spreads, further market growth and diversification are expected across Europe.

Animal Type Insights

Based on animal type, the market is segmented into dogs, cats, and others. In 2023, the dogs segment dominated the market with a substantial share of over 50.0% due to growing pet adoption, expansion of service offerings by insurance companies, and growing disposable income. Pet insurance plans for dogs cover a wide range of conditions, such as outpatient and inpatient treatment, health checks, preventive measures such as vaccinations, dental prophylaxis, flea & tick prevention, medication costs, bandages, castration & sterilization, and operations. Moreover, in Germany, pets are treated as beloved family members. The growing need to lower financial risks and safeguard pet health is expected to drive the market.

The other animals segment, such as horses, small mammals, reptiles, and others, are expected to grow at the fastest CAGR of 16.6% during the forecast period. This growth is driven by evolving pet ownership patterns, increasing demand for specialized coverage, advancements in veterinary care, and favorable economic conditions. As pet owners become more aware of the unique health risks and care requirements associated with different animals, the demand for specialized insurance products has surged. Horse insurance by Petplan, for instance, covers vet fees, personal accidents, permanent loss of use, and third-party liability, insuring horses up to 25 years old. The company provides three plans: a horse insurance plan for first-time owners or serious competitors, a veteran plan for horses aged 17 to 40, and an essential insurance policy for riders aged 5 to 75 years who do not own a horse.

Coverage Type Insights

In 2023, accident & illness dominated the market, accounting for over 80.0% of the total share. The high costs of veterinary treatments drive this dominance as the number of companion animals increases and awareness of the benefits of pet insurance increases. These policies offer extensive coverage, including medications, chronic and acute diseases, and diagnostic tests. This comprehensive protection appeals to pet owners, contributing to the segment's rapid growth. For instance, PetGuard, a UK-based insurer, provides accident and illness coverage with annual payouts up to USD 3,848.84, USD 7,697.67, or USD 15,395.34 to cover treatment costs for pets. This growth trend in the accident and illness segment is expected to continue as more pet owners recognize the value of such comprehensive coverage.

The other insurance types, such as liability insurance policies, lifetime insurance, and surgery, are expected to grow at the fastest CAGR of 15.5% during the forecast period. This growth is attributed to the need for coverage against potential damages and legal costs, particularly for dogs and horses. Companies like BavariaDirekt and Barmenia Insurance in Germany provide various liability policies, including those for horse owners that cover extensive damages and costs. Renters insurance often includes minimal liability coverage for dogs, with typical legal costs for dog bites ranging from USD 100,000 to USD 300,000. The average cost of dog bite claims has surged, reaching around USD 50,245 in 2020, highlighting the increasing importance of such insurance coverage.

Sales Channel Insights

Based on sales channel, the direct channel segment held the largest share of over 35.0% in 2023. This can be attributed to key pet insurance providers' high usage of direct sales strategies. DFV Deutsche Familienversicherung AG, for instance, reported that direct sales contributed to 87.3% of the company’s new business during 2020. Similarly, Petplan reported that direct sales accounted for about 61% of its personal lines insurance revenue in 2020. Moreover, direct sales channels have multiple benefits, such as promoting segment growth. This channel often allows for more personalized customer service and policy customization. Pet owners can tailor their coverage to meet the specific needs of their pets, which is a strong incentive for choosing direct sales.

The others segment comprises employers, pet stores, animal care centers, and vets and is anticipated to grow fastest over the forecast period. This can be attributed to the increasing number of companies onboarding veterinary care providers and pet stores to reach consumers or pet parents. Petplan, a leading company in the market, attributed 4.5% of its revenue in 2020 to vets. Similar partnerships between insurance providers and other industry stakeholders are anticipated to contribute to the segment growth over the forecast period. Moreover, veterinary clinics often promote preventive care, which can be more affordable and effective when covered by insurance. This encourages pet owners to invest in insurance plans that cover such services.

Regional Insights

The UK pet insurance market is bolstered by increasing pet ownership and awareness of pet health risks. The Association of British Insurers (ABI) reported that pet insurance payouts in 2022 exceeded GBP 1 billion (USD 1.28 Bn), the highest on record since data collection began in 2007. This averages GBP 2.8 million (USD 3.57 Mn) paid out daily for veterinary treatments and diagnoses. This surge reflects rising pet ownership costs and the growing number of insured pets. In 2022, 1.3 million claims were made, a 28% increase from the previous year, with payouts rising by 17%. Dogs accounted for 75% of claims, cats 20%, and other pets 5%. The most common claims involved spinal surgery, costing between USD 10,201.74 and USD 12,752.17, while ongoing claims were often for skin conditions and diabetes.

Germany Pet Insurance Market Trends

The pet insurance market in Germany is thriving due to a combination of high pet ownership rates and a strong emphasis on pet health. The German market benefits from a robust regulatory environment and increased consumer awareness of the financial benefits of pet insurance. According to FEDIAF estimates, 25% of German households owned at least one dog in 2023, while 26% owned at least one cat. According to a 2020 survey by Coya, an insurance provider for pets in Germany, the country had some of the best cities in the world to own and raise a pet. In addition, in its Best Cities for Dogs Index, Munich, Cologne, Hamburg, Berlin, and Frankfurt ranked in the top 30.

Spain Pet Insurance Market Trends

The pet insurance market in Spain is expanding significantly due to increasing pet ownership and rising disposable incomes. As Spanish households spend more on pets, there is a growing recognition of the financial benefits of insurance. As per the recent animal welfare law in the country, which was enacted in September 2023, pet owners would be forced to purchase liability insurance for their pets under the new regulations. The annual payment is likely around USD 27.2 to USD 32 and approximately USD 54.5 for dogs assessed to be of a dangerous breed. Dog owners who do not have this insurance as of September 29, 2023, are subject to fines from USD 545.07 to USD 1,090.1. Pet owners opt for insurance policies to save extra expenses, which is expected to fuel the market growth over the forecast period.

Sweden Pet Insurance Market Trends

The pet insurance market in Sweden is expanding due to a high rate of pet ownership and increasing public awareness of the benefits of pet insurance. Sweden has one of the highest pet ownership rates in Europe, and with this comes a growing demand for insurance to cover the costs of veterinary care. According to the National Association of Insurance Commissioners, over a million dogs were kept as pets in Sweden in 2021, and 90% had insurance. Dog insurance is voluntarily purchased by many pet owners in Sweden, with annual premiums averaging USD 536. In addition, the expansion of key insurance companies into the Swedish market is fueling market growth. For instance, in May 2023, Hedvig, a Swedish full-stack insurer, entered the market. The company’s coverage includes compensation for time spent at home caring for pets and offers a SEK 1,000 deductible discount if policyholders use FirstVet. Claims can be reported through Hedvig's app. Such expansions strengthen competition, diversify coverage options, and boost consumer interest, driving the overall market growth in Sweden.

Key Europe Pet Insurance Company Insights

The market is characterized by several key players who dominate the landscape and have substantial market shares. These companies lead the industry through extensive distribution networks and a broad portfolio.

Recent Developments

• In October 2023, DFV Deutsche Familienversicherung AG introduced the BiPRO interface to optimize digital collaboration with brokers to provide high-quality, direct insurance products that facilitate brokers' focus on customer needs.

• In October 2023, Getsafe acquired Luko Insurance's entire German customer base, adding 50,000 policies to its portfolio. With over 550,000 customers across Europe, Getsafe continues its profitable growth by focusing on a fully digital D2C model targeting young, tech-savvy Europeans. The acquisition aligns with Getsafe's strategy to become a leading platform for digital insurance, achieving higher margins & customer satisfaction.

• In February 2023, Waggel Limited partnered with Vet-AI to provide its pet insurance customers unlimited access to Joii Pet Care's 24/7 digital vet consultations, vet nurse consultations, and a symptom checker. This collaboration simplifies pet insurance and enhances pet health through innovative, convenient online veterinary care.

• In June 2022, JAB Holding Company entered into a strategic partnership with Fairfax Financial Holdings by acquiring Fairfax's interests in Crum & Forster Pet Insurance Group and Pethealth Inc. This acquisition is expected to create a combined global pet insurance platform with estimated revenues exceeding USD 1.2 billion by 2023, insuring over 2.1 million pets.

Europe Pet Insurance Market Report Scope

Europe Pet Insurance Market Report Segmentation

This report forecasts revenue growth at the country level and analyzes the latest industry trends in each of the sub-segments from 2018 to 2030. For this study, Grand View Research has segmented the Europe pet insurance market report based on animal type, coverage type, and sales channel:

• Animal Type Outlook (Revenue, USD Million, 2018 - 2030)

  • Dogs

  • Cats

  • Others

• Coverage Type Outlook (Revenue, USD Million, 2018 - 2030)

  • Accident & Illness

  • Accident only

  • Others

• Sales Channel Outlook (Revenue, USD Million, 2018 - 2030)

  • Agency

  • Broker

  • Direct

  • Bancassurance

  • Others

• Regional Outlook (Revenue, USD Million, 2018 - 2030)

  • Europe

    • Germany

    • UK

    • France

    • Italy

    • Spain

    • Denmark

    • Sweden

    • Norway

    • Austria

    • Hungary

    • Poland

    • Romania

    • Czech Republic

    • Switzerland

    • Luxembourg

    • Portugal

    • Belgium

    • Rest of Europe