Business is booming in pet health insurance

When it comes to liking dogs and cats and putting money into their pets' health Nevadans are close to the top of the list.

Marketers of health insurance for pets, folks who can read the economic data as well as anyone, believe Nevada has the potential to be a boom market for their fledgling industry.

Veterinary Pet Insurance of Brea, Calif., says Nevada is its second fastest growing market. And a newcomer to the industry, Boise-based Pets Best, said last week it's targeting Nevada as it begins rolling out its pet plans.

The population of aging Baby Boomers in Nevada is particularly attractive to Veterinary Pet Insurance, which counts 382 pets in the Reno area among the 5,632 it insures statewide.

Bobbie Cooper, the company's director of consumer marketing, says a typical buyer of a Veterinary Pet Insurance Plan is a middle-aged woman, a college-educated professional with no children at home.

Members of that group, she says, often look upon pets as a next generation of children after their own kids have left the nest.

Another big demographic for the company, Cooper says, is younger couples who don't yet have children and treat their pets as a first step toward parenthood.

No matter what drives them, Nevadansspend above-average amounts at their veterinarian's office, says Jack Stephens, a veterinarian who founded Pets Best, a division of General Fire & Casualty Co.

"Veterinary care in Nevada is a very high priority for pet owners," he says, noting that veterinary practices in the state typically are busier than they are elsewhere in the nation.

And consumers who pay an above-average number of veterinary bills are likely to give a hearing to companies selling insurance to cover some of the costs.

Pets Best offers a basic plan to cover a dog a plan with a $200 deductible for $20.75 a month. An accident-only plan runs $5.75 a month with the same deductible. The company pays 80 percent of claims after the deductible is covered.

While premiums at Veterinary Pet Insurance differ with the age of the animal, Cooper says a popular plan that provides wellness checkups as well as veterinary care for unexpected problems runs about $235 a year.

The companies writing health insurance on animals are betting that Americans will follow the path of pet owners elsewhere in the world.

The American Pet Product Manufacturers Association estimates that 3 percent of American dogs and 1 percent of the nation's cats are covered by a health plan. In the United Kingdom, by comparison, health plans cover 25 percent of the nation's dogs and 5 percent of its cats.

And Packaged Facts, a research outfit, estimates that premiums written for health insurance in the United States will reach $185 million this year, up 23 percent from a year earlier.

To reach that market, insurers talk to veterinarians and pitch their products directly to consumers.

Veterinarians are good salespeople, Cooper says, because they often are pained when pet owners need to weigh financial considerations in deciding whether to preserve the life of an animal.

Decisions get difficult for many pet owners, she says, when the costs of treatment are likely to exceed $500.

Along with its marketing to the veterinary profession, Veterinary Pet Insurance also advertises directly to consumers through pet magazines as well as traditional women's magazines such as Women's World and Cosmopolitan publications read by the women who are heavy buyers of pet insurance.

Before they can market their products in Nevada, pet health companies need the approval of the state Division of Insurance.

But C.B. Knaus of the division notes that they're not licensed as health insurers because state law limits that designation to companies that insure humans. Instead, pet insurers are covered as property-and-casualty firms.

Both Pets Best and Veterinary Pet Insurance say they're licensed in Nevada.