Pets Are More Than Pets

Pop quiz: What do Walgreens, Google and Disney have in common? They’re among the one-third of Fortune 500 companies offering pet insurance as a voluntary benefit. These companies have found that attracting and retaining top talent requires more than paying a competitive salary, it requires offering benefits that enrich the lives of employees and their families.

For the more than two-thirds of Americans who have pets, that increasingly means investing in pet insurance, which reimburses owners for unexpected veterinary bills like those related to an illness or injury. In fact, the Washington Times reports that pet insurance is “one of the three most requested voluntary employee benefits.”

It’s not hard to see why. We’ve witnessed a cultural shift in the way we think about our pets. From pet-friendly “Yappy Hours” to “Grumpy Cat,” pets have captured our collective imagination. Whimsy aside, they’ve also captured our hearts.

The proof is in this little thought experiment: Imagine 100 pet-owning employees standing in your conference room. According to a Harris Interactive poll, you could look around and safely assume the following:

• 20 gave their pet a birthday gift last year
• 33 gave their pet a gift over the holidays
• 57 let their pets snuggle in bed frequently
• 92 of them think of their pets as family members

Let that last one sink in for a minute. Pets have become full-fledged furry family members, and most people would do anything for family — even if it means going into debt to pay for medical care.

Seventy-three percent of pet parents admitted they’d do exactly that in a survey by the American Animal Hospital Association. Statistically, it happens more often that you might think: one in three pets will require unexpected veterinary care this year¹.

The good news is that veterinary medicine is more sophisticated than ever. Veterinary MRI, surgery and chemotherapy are increasingly available in many parts of the country, as are cutting-edge technologies that rival those used in human medicine (think cold laser, gamma knife and stem cell therapy).

But those advancements are accompanied by rising costs. Last year, Americans spent $15.37 billion on veterinary care, according to an industry report by the APPA. In fact, every six seconds a pet parent faces a vet bill for $3,000 or more!²

All of which has set the stage for explosive growth. Today, more than a million American pet parents have a pet insurance policy. While that represents less than 2 percent of the pet population, the North American Pet Health Insurance Association estimates industry growth at 13 percent per year.

Moreover, this story has already played out in the UK and Sweden, where nearly 30 percent and 50 percent of pets are insured, respectively.³ Growth in the American market is following a predictable trajectory already seen in those more mature markets. With 160 million+ dogs and cats in the US, it’s clear that pet insurance is here to stay.⁴

This Benefit’s Benefits

As an employee, having pet insurance means no longer having to worry about whether you can afford the care your pet needs. It means being able to focus on what matters — the health and happiness of your furry family member — instead of agonizing over the costs.

As an employer, offering pet insurance as a voluntary benefit demonstrates to employees that you care about what’s important to them — you’re supporting their personal, emotional and financial well-being. It’s not often that you can invest in a happier, healthier and more productive workforce at little or no cost to the company.

Today’s top talent wants more than a paycheck, they want a healthy work-life balance and an attractive benefits package from a company they feel good about. Employers who offer pet insurance make a strong case for all three.

Choosing the Right Partner

Making the decision to offer pet insurance in your voluntary benefits package is the easy part. Now it’s time to decide which provider offers the best fit. There are many choices in this fast-growing marketplace, so start by checking out the underwriters’ ratings with independent insurance ratings agencies like A.M. Best.

Websites like PetInsuranceReview.com offer valuable information about the companies’ offerings and their reputations in the marketplace, as well as individual customer reviews.

There are stark differences between pet insurance providers’ product offerings. Here are some key questions to ask of any prospective provider:

• Does the provider cover all illness and injury as standard (including breed-specific or hereditary conditions like hip dysplasia in German Shepherds)?
• Does the provider require additional fees or riders for coverage of certain types of serious conditions (like cancer)? If so, pass. It’s a better value to your employees to go with a provider who offers a comprehensive plan.
• Does the provider cover chronic conditions like allergies, pancreatitis and diabetes as pets age? Roughly 30 to 40 percent of all pet insurance claims are for chronic conditions that can last beyond 12 months⁵, so this is an important consideration.
• Does the provider use complicated benefits schedules when determining the amount of reimbursement? Or is it based on the actual cost of treatment provided by the vet? This is the better value for your employees. A provider that uses a benefit schedule could leave your employees paying more out-of-pocket then they signed up for.
• Does the provider cover alternative and behavioral therapies?
• Will the provider reimburse for care from any veterinarian? You want to be sure your employees aren’t restricted to specific veterinarians or locations.
• Veterinary emergencies can happen at any time. Does the provider offer customer service 24/7?
• Are plans flexible in terms of co-pay, deductible and coverage amounts? The ability to customize a plan is important for your employees, who may have different needs.

Your employees’ experiences with any benefits partner can reflect on you as an employer. Due diligence is critical. By asking the questions that matter to pet parents, you can make an informed decision and ensure that those experiences reflect positively on the company.

By: Chris Ashton