Health insurance for pets taking off

Health data on pets allowing insurers to laser focus on price point for underwriting

With pet insurance gaining popularity in North America, companies are quickly collecting actuarial data to place better price points for the coverage.

Trupanion is a company that offers medical insurance to cats and dogs. That’s right, health insurance for cats and dogs. We help pet owners pay for veterinary bills. However, our insurance company is a P&L insurer.

“We were the first pet insurance company to develop an actuarial department and hire, train and invest in an exceptional team of actuaries,” says Britta Gidican of Trupanion, an insurer that offers medical insurance to cats and dogs. “We have a huge repository of pet health data. We have accumulated over 5.5 million pet health records over the past 14 years and have over 1.2 million pricing categories for over 400 cat and dog breeds in 43,000 zip codes across the United States and Canada.”

The data-driven model enables the insurer to offer medical coverage plans on an individual pet level that are unique and cater to each pet’s needs, says Gidican.

“Basically we use data to predict the health issues a cat or dog will experience and price our insurance product accordingly around that,” she says. “We use data tools like DataRobot, SiSense, and Tableau.”

Pet insurance in North America has only a 2% penetration rate in North America, says Randy Valpy, vice president and managing director of pet insurance, RSA Canada / Pets Plus us, but has been around since the 1940s in Great Britain, and enjoys a 40% market penetration in Sweden.

“Pet insurance got its start in 1989 when the first company launched, but it wasn’t until the early 200s that it began to gain real traction,” Valpy told IBC earlier this year. “Today there are about five companies and 12 brands of insurance in Canada.”