Increase in pet adoption during lockdown months opens up market opportunity
It is a widely known fact that Britain is a nation of pet lovers. The country has 21 million dog owners, with around 45 percent of British households having a pet. The stay-at-home orders in the last few months have spurred a further increase in pet adoption as people sought companionship during times that saw social life grind to a halt and working from home become the new norm.
In the UK, The Royal Society for the Prevention of Cruelty to Animals said it saw a 600% increase in visits to its dog fostering page and a rise of 30% in traffic to its Find a Pet section during the lockdown months, as reported by the FT.
The flurry of searches for a four-legged friend has been seen in other countries too. In the major US cities, there has been a 90% increase in pet adoption since the start of pandemic, Global Market Insights found.
In New York, one of the US cities hardest hit by the pandemic, Sarah Brasky, founder and executive director of Foster Dogs Inc, a New York-based non-profit that connects animal rescue organisations with adopters and fosterers, told CNN that the demand for dogs during the lockdown was “totally unprecedented”. In March this year, foster applications in the New York area were up more than 1000% on March 2019, Brasky said.
From a market perspective, pet-related stocks can open up investment opportunities, which remain largely off the radar of many investors. The pet care industry could reach $203 billion in global sales by 2025, says ProShares, with a steady growth since 2001. Some of the most successful stocks in the industry are: Chewy (NYSE: CHWY), an online pet product store that saw its shares go up 35% year-to-date in May; Zoetis (NYSE: ZTS) the world’s largest producer of medicine and vaccinations for pets and livestock, and (NASDAQ: TRUP), a pet insurance provider offering and administering cat and dog insurance.
Pet Insurance: Is it worth it?
Pet insurance poses an interesting conundrum: the FT reports that only 3.6m people in the UK have pet insurance, leaving many owners who have opted not to take out a policy. In 2016, gross written premiums in the UK pet insurance industry amounted to over one billion GBP, according to Statista. In 2019, the pet insurance market had contracted by 1.8% but with increased pet ownership, this decline could be reversed in 2020.
Pet insurance claims have almost doubled from £452m in 2012 to £815m in 2019, with the average claim totalling £793, says data from Statista Research.
Considering that veterinary costs and pet services alone can be quite expensive, having amounted to 4.2 billion GBP in 2017, insuring your pet can be a good idea. “As vet care gets better and utilises technology more and more, vet bills will continue to increase. With bills getting higher, people will need to take out cover to protect themselves from vet bills that can go into the thousands,” Andrew Leal, co-founder of Waggel, a London based insurtech company, told the FT.
Petplan is one of the UK’s top pet insurers and a clear favourite, covering more than 1.3m pets. Other big players in the industry, according to the Telegraph, are Tesco Pet Insurance, Argos Pet Insurance, More than Pet Insurance, Direct Line Pet Insurance and Sainsbury’s Pet Insurance.
There are different types of pet insurance and costs may vary according to breed, age, size and policy type, among other criteria.
Do you have a pet? Have you insured your pet? Tell us about your experiences with pet insurance and pet products and supplies.
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