MetLife enters pet insurance market with latest acquisition
Metlife is acquiring pet health insurance administrator PetFirst as the benefits, insurance and investment giant looks to leverage its position as a leader in the U.S. group benefits market.
Pet insurance is growing in popularity as younger generations of workers put off having families and are instead opting for animal companions. Sixty-seven percent of U.S. households, or about 85 million families, own a pet, according to the 2019-2020 National Pet Owners Survey conducted by the American Pet Products Association. The annual growth rate for the pet insurance industry has been more than 20% since 2014, according to the North American Pet Health Insurance Association’s 2019 State of the Industry report.
Pet health insurance is offered by 15% of organizations, according to data from the Society for Human Resource Management. Microsoft, Chipotle, Deloitte and T-Mobile are among the employers who offer pet insurance benefits.
“In general one of our strategies has been to continue to focus on voluntary benefits. We know that employees are asking for them and employers are eager to provide benefits that will be of value and help with employee retention,” says Paul Piechnik, senior vice president of group benefits at MetLife. “Pet insurance is one of the fastest growing voluntary benefits.”
PetFirst, headquartered in Jeffersonville, Indiana, was founded in 2014 and currently administers insurance coverage on more than 40,000 pets, according to MetLife. The company was purchased for an undisclosed amount, and all 60 employees will remain in Jeffersonville once the deal closes in the first quarter of 2020. MetLife customers will have access to PetFirst product beginning in the summer of 2020. The company distributes its insurance products through animal welfare agencies, direct- to-consumer channels and employers.
Employers have begun to take notice of the great lengths employees will go to to care for their animals, sometimes going into debt in order to care for a pet. About 45% of pet owners will spend the same or more on an animal’s healthcare than on their own, according to a Lendedu survey of 1,000 pet owners. Of those surveyed, 10% of pet owners say they had missed a payment on another bill in order to pay for petcare.
Employees also say they feel a greater sense of loyalty to their company when the organization is pet friendly, according to SHRM. Indeed, 46% of employees say pet insurance is a must-or nice-to have benefit from their employer, according to the 2019 MetLife U.S. Employee Benefit Trends study.
“So many employers are becoming more pet friendly, offering things like pet bereavement leave,” Piechnik says. “Clearly employers think it’s important for employees and how they can help [employees] with their financial wellness.”