Is Pet Insurance Worth It? What Pet Owners Need to Know in 2025
ByAlexandra Soanca
Last updatedFeb 22, 2025
✓Fact Checked
Key Findings
In 1982, Lassie became the first pet ever insured in the U.S., marking the start of the pet insurance industry.
Over 5.7 million pets in the U.S. are insured as of 2024, a 17% increase from the previous year.
The average cost of pet insurance (2025): Dogs: $30 - $65/month, Cats: $15 - $40/month.
The pet insurance market is projected to surpass $15 billion by 2030.
Only about 4% of U.S. pets are currently insured, compared to 25% in the UK and 90% of dogs & 50% of cats in Sweden.
Quick Navigation
Key Findings
📊 The Growth of Pet Insurance in the U.S.
💰 Understanding Pet Insurance Costs and Coverage
📉 Why Some Pet Owners Still Hesitate to Get Insurance
🐕 First Pet Ever Insured in the U.S. and The Evolution of Policies
🚀 The Future of Pet Insurance
💡 Final thoughts
For most pet parents, there's no question - they would do whatever it takes to keep their furry (or not-so-furry 🐦🐢) family members safe and healthy. But with veterinary costs rising, many are left wondering: Is pet insurance really worth it?
What started as a niche thing decades ago has now grown into a multi-billion dollar industry. In 1982, a famous TV dog became the first pet ever insured in America, marking the beginning of what has become an essential service for millions of pet owners today. With over 5.7 million pets currently insured in the U.S. and the market expected to surpass $15 billion by 2030, it's clear that more pet parents are seeing the value in protecting their pets - but also their wallets.
How much does pet insurance actually cost? What does it cover? And why do some pet owners still hesitate to sign up? We took a deep dive into the data, the history, and the evolving trends of pet insurance to uncover everything pet owners need to know before making a decision in 2025.
📊 The Growth of Pet Insurance in the U.S.
Pet insurance was once seen as an unnecessary expense, but today, it's becoming a must-have for millions of pet parents. With veterinary costs going up and medical advancements making treatments more expensive, more owners are choosing to protect their furry companions with coverage.
As of 2024, over 5.7 million pets in the U.S. are insured, marking a 17% increase from the previous year. The industry has experienced huge growth, with total premium volume reaching $4.99 billion in 2024 and predictions showing it will surpass $15 billion by 2030.
🔹 In 2017, only 2.1 million pets were insured in the U.S. - that number has nearly tripled in under a decade. 🔹 Dogs account for about 80% of insured pets, while cats make up the remaining 20%.
One of the biggest reasons for this? Rising veterinary costs. With advanced treatments like MRIs, cancer therapies, and orthopedic surgeries becoming more common, vet bills can easily reach thousands of dollars. As a result, more owners are choosing coverage to protect both their pets and their finances.
But there's still a really long way to go - only about 4% of U.S. pets are insured, compared to 25% in the UK and 90% of dogs and 50% of cats insured in Sweden. But awareness is increasing, and more flexible, affordable plans are emerging, so industry experts predict rapid adoption in the coming years.
💰 Understanding Pet Insurance Costs and Coverage
Pet insurance can be a lifesaver for both pets and owners, but many pet parents are still unsure about how much it costs, what it covers, and whether it's worth the investment.
How Much Does Pet Insurance Cost?
The cost of pet insurance varies based on factors like breed, age, location, and coverage type, but here is a general breakdown:
Average Monthly Costs in the U.S. (2025): 🐕 Dogs: $30 – $65 per month 🐈 Cats: $15 – $40 per month
What Influences the Price?
Breed & Age: Larger breeds and older pets cost more because of higher medical risks.
Location: Vet costs differ by state - pet insurance is more expensive in urban areas.
Coverage Type: Accident-only plans are cheaper, while comprehensive plans (accident + illness) cost more.
Deductibles & Reimbursement Rates: A higher deductible lowers premiums, but reduces payouts when filing claims. Lower deductibles mean higher monthly premiums, but insurance will cover costs sooner.
What Does Pet Insurance Cover?
✅ Most pet insurance plans fall into three categories:
Comprehensive (Accident & Illness): Covers injuries, illnesses, surgeries, cancer treatments, and chronic conditions. (Most popular plan type.)
Accident-Only: Covers injuries like broken bones, poisoning, and bite wounds but excludes illnesses.
Wellness Add-Ons: Cover preventative care like vaccines, checkups, and dental cleanings, usually for an additional cost.
❌ What's Typically NOT Covered?
Pre-existing conditions: illnesses or injuries that occurred before enrolling.
Breeding costs: pregnancy, labor, and related complications.
📌
Can Pet Insurance Cover Lost Pet Expenses?Losing a pet is every pet parent's worst nightmare - but did you know that some pet insurance policies actually help cover lost pet-related expenses? While pet insurance won't exactly send out a search party, some policies help cover the costs that come with finding a missing pet. At PetRadar, we're all about bringing lost pets home - so if you ever need a recovery invoice for your insurance claim, we've got you covered!😉
📉 Why Some Pet Owners Still Hesitate to Get Insurance
Despite the benefits, only about 4% of U.S. pets are insured, leaving millions of pet parents financially vulnerable to unexpected vet bills. So why do so many pet owners still hesitate to get coverage?
1. The Psychological Barrier: "I'll Worry About It Later"
Many pet owners don't think about insurance until it's too late - after an accident, illness, or emergency has already happened. Unlike car or home insurance, which people are required to have, pet insurance feels optional - until they're suddenly faced with a $5,000 vet bill 😵.
2. The Cost Misconception: "It's Too Expensive"
Many people overestimate the cost of pet insurance. In reality, as we were showing you earlier, basic coverage can cost less than a single vet visit per year.
A single emergency vet visit can cost more than a full year of insurance premiums, yet many owners only consider coverage after experiencing a costly medical issue.
3. The Trust Issue: "Will They Even Pay My Claims?"
Some pet parents hesitate to enroll because they don't fully trust insurance providers. Common concerns include denied claims, slow reimbursement times, confusing coverage terms.
To address this, many insurance providers are improving transparency, offering customizable plans, and speeding up claims processing with AI-driven approvals 🤖.
The best way to avoid claim surprises is to enroll early, research carefully, and choose an insurer with a strong reputation for customer service.
4. The Unused Policy Worry: "What If I Never Use It?"
Some pet owners hesitate to get insurance, worrying they will pay for something they may never need. But just like human health insurance, pet insurance isn't about everyday expenses - it's about being prepared for the unexpected 🛡️.
Even the healthiest pets can face sudden accidents, illnesses, or age-related conditions, and when that happens, the cost of treatment can be overwhelming. The reality is, it's far better to have coverage and not need it than to need it and not have it.
💡 Regret & Reality
Many pet owners realize the value of insurance too late. Stories of pets needing life-saving surgeries, cancer treatments, or emergency care are common - leaving owners struggling to afford treatment.
Examples of common high-cost vet procedures:
Surgery for a torn ACL: $3,500 – $5,000 per knee
Emergency hospitalization for illness: $5,000 - $10,000
Cancer treatments (chemotherapy, radiation): $3,000 - $10,000
Without insurance, these costs can force pet owners to make very difficult financial decisions, sometimes having to delay or forgo treatment altogether.
🐕 First Pet Ever Insured in the U.S. and The Evolution of Policies
In 1982, the first pet ever insured in America wasn't just any dog - it was Lassie, the beloved TV collie. Given how many times she saved Timmy from the well, it's only fair she got some coverage of her own!
At the time, pet insurance was basically unheard of in the U.S., but as veterinary medicine advanced and the cost of care increased, so did the demand for coverage. What started as a niche industry has now become a $5 billion market, with policies that have evolved dramatically over the years.
💡 Then vs. Now: How Pet Insurance Evolved:
🚀 The Future of Pet Insurance
With more customizable plans, AI-processed claims, and even telehealth for pets, the industry is adapting to meet the needs of modern pet parents. Insurance providers are also expanding coverage beyond just dogs and cats, ensuring more pets than ever can benefit from financial protection.
Here's what's next for pet insurance and how it's evolving to become a smarter, more accessible investment for pet owners everywhere:
1. More Customizable & Flexible Plans
Traditional pet insurance has often been a one-size-fits-all model, but newer policies allow pet owners to customize coverage based on their pet's specific needs. Insurers are introducing:
Modular plans - Owners can pick and choose coverage for accidents, illnesses, wellness care, or alternative treatments.
Hereditary & breed-specific condition coverage - Some policies now offer custom pricing based on genetic risks.
Preventative care options - More plans are including routine checkups, dental cleanings, and vaccinations to encourage proactive pet healthcare.
2. Faster Claims Processing with AI & Automation
One of the biggest frustrations with pet insurance is slow claims processing, but that's rapidly changing. Many insurers are now using:
AI-driven claims approvals - Some companies automatically approve claims within minutes, reducing wait times.
Paperless, app-based claims submissions - No more faxing and e-mailing receipts - pet owners can now * submit claims instantly via smartphone apps.
Direct vet payments - Some insurers are working with veterinarians to pay clinics directly, reducing out-of-pocket expenses for pet owners.
3. Rising Costs & the Push for More Affordable Options
As the pet insurance industry grows, costs are expected to rise due to increasing veterinary expenses and advanced medical treatments. However, insurers are working on solutions to keep premiums competitive, including:
Multi-pet discounts - More providers now offer discounts for insuring multiple pets under the same policy.
Employer-sponsored pet insurance - Some companies are adding pet insurance as an employee benefit, similar to health insurance.
Partnerships with shelters & rescue organizations - More adoption packages now include temporary pet insurance, giving new pet owners an opportunity to enroll at a lower cost.
4. Expanding Coverage to Non-Traditional Pets
Most pet insurance policies today focus on dogs and cats, but as more households welcome rabbits, birds, reptiles, and exotic pets, insurers are broadening coverage options to include:
Birds & exotic pets - Parrots, lizards, and small mammals like guinea pigs are now eligible for some policies.
Equine insurance growth - With horse ownership rising, equine-specific policies are expanding to cover everything from medical emergencies to alternative therapies.
5. The Role of Technology: Telehealth & Wearable Pet Tech
Technology is changing pet healthcare, and insurers are starting to adapt to the digital age. Expect to see:
Telehealth for pets - Virtual vet consultations will be covered under more plans, reducing unnecessary in-person visits.
Wearable pet health devices - Smart collars that monitor heart rate, activity levels, and vital signs could soon be integrated into insurance plans for preventative care.
6. More Awareness & Higher Adoption Rates
As more people recognize the financial benefits of coverage, experts predict a major change in how pet insurance is viewed:
Younger pet owners leading the way - Millennials and Gen Z are more likely to insure their pets, treating them as family members.
More regulation & consumer protections - Lawmakers may introduce more oversight on pet insurance providers to ensure fair pricing and clearer policy terms.
💡 Final thoughts
At PetRadar, we've seen how much pet parents will do to protect their furry family members. Searching tirelessly and using every resource available to bring a lost pet home, it just shows that their dedication is unshakeable. But when it comes to medical emergencies, being prepared before disaster is just as important.
We've helped thousands of pet owners reunite with their lost companions because we truly believe pets are family. And just like we would do anything to bring them home, we should do everything we can to protect them while they are with us.
For pet parents, the question should no longer be "Is pet insurance worth it?" but "Can I afford NOT to have it?"
📑 Sources & References
PetRadar Research & Reports – Pet Ownership in the U.S. (2025) North American Pet Health Insurance Association (NAPHIA) American Pet Products Association (APPA) 2023 - 2024 National Institutes of Health (NIH) Insurance Information Institute (III) Harvard Health Human-Animal Bond Research Institute (HABRI) Centers for Disease Control and Prevention (CDC)
Written by
Alexandra Soanca
I’ve gained a deep understanding of the challenges and emotions that come with searching for a missing pet, and I’m here to provide guidance, support, and a little bit of hope along the way.
When I'm not helping reunite lost pets with their pet parents, you’ll likely find me spending time with my own furry companion, Valla - a curious gray tabby with a **very** independent spirit.
