Rising vet bills drive more Americans to pet insurance
XLF•About 7 million pets, or more than 4% of U.S. pets, had insurance in 2025, up 9% year over year and 76% in five years. Pet insurance premiums are projected to rise 17% to $6.4 billion in 2026 as veterinary costs and treatment options expand.
1. Coverage gains
Rising veterinary costs and advances in animal medicine are pushing more Americans to buy pet insurance. About 7 million pets, or more than 4% of U.S. pets, were insured in 2025, according to the North American Pet Health Insurance Association; coverage was up 9% from the prior year and 76% from five years earlier.
2. Costs and care
Annual veterinary spending averaged about $560 last year, while specialized cancer care, surgery, advanced diagnostics and chronic-condition management can cost thousands of dollars. Veterinary-service prices were 4.6% higher in September 2026 than a year earlier, according to Bureau of Labor Statistics data. Veterinarians cited higher costs for supplies, shipping, employee healthcare and labor, as well as a wider range of specialists and treatments.
3. Claims and premiums
Pet insurance premiums are projected to rise 17% to $6.4 billion in 2026, said Tim Zawacki of S&P Global Market Intelligence. Embrace Pet Insurance reimbursed more than $14,300 of the roughly $20,500 spent on Amanda Moore’s dog’s cancer treatment. Trupanion said its highest individual claim exceeded $150,000, while its net subscription pet additions rose nearly 40% in the second quarter year over year.
