Despite low market penetration, pet health insurance is one of the fastest-growing lines in the property/casualty industry, averaging approximately 20% annual growth since the COVID-19 pandemic, according to a new AM Best report.

The Best’s Market Segment Report, “US Pet Insurance Plans: First View Shows Rapid and Profitable Growth,” finds that the segment’s net combined ratio under the breakeven point in 2024 and 2025 signified profitable underwriting for the segment. With two years of pet insurance-specific data available from NAIC annual statement filings, the growth in pet health insurance is evident as total direct premiums written were up 17% to $5.5 billion as compared with 2024. However, according to the North American Pet Health Insurance Association, total pet insurance DPW has doubled since 2021.

“In the post-COVID world, the U.S. population has developed even deeper bonds with their pets because of the increased time spent together,” said Christopher Graham, senior industry research analyst, AM Best. “Pet health care services being sought now regularly encompass more than standard medical emergencies and also include pet owners being more willing to invest in behavioral support for sick or injured pets.”

According to the report, managing general agents (MGAs) have been integral in partnering with the leading pet insurers to propel the considerable growth of this niche insurance market segment. Several of the top pet insurers, including the top six, used MGAs to produce most or all their pet insurance premium in 2025.

“For pet insurance carriers, alignment with MGAs with specialized knowledge has helped these insurers build their portfolios with the MGAs acting as extensions of the insurance company,” said David Blades, associate director, Industry Research and Analytics, AM Best.

Other report takeaways include:

  • Total pet health insurance DPW for first-quarter 2026 was up 17% year over year from 2025. Given the rapidly increasing costs for pet care and rising pet ownership, AM Best expects further growth in pet insurance premiums in the medium term.
  • The pet health insurance market is overwhelmingly concentrated, with the top 10 insurers accounting for 98% of total P/C industry pet insurance premium. Trupanion Insurance Group was the market leader in 2025, accounting for over 20% of the market.
  • Net loss ratios among the top 10 pet insurance groups in 2025 spanned from a low of 57.1 to a high of 93.3, with an average for the entire pet insurance population of 69.1.
  • Losses for pet health claims settle quickly: The ratio of paid losses to ultimate losses for pet health claims is on par with auto physical damage, with nearly 90% of losses paid after just 12 months and over 99% paid after 24 months.

To access the full copy of the Best’s Market Segment Report, please visit http://www3.ambest.com/bestweek/purchase.asp?record_code=367127.

AM Best is a global credit rating agency, news publisher and data analytics provider specializing in the insurance industry. Headquartered in the United States, the company does business in over 100 countries with regional offices in London, Amsterdam, Dubai, Hong Kong, Singapore and Mexico City. For more information, visit www.ambest.com.

Copyright © 2026 by A.M. Best Rating Services, Inc. and/or its affiliates. ALL RIGHTS RESERVED.

Media gallery

About The Author
Business Wire