By Lewis Nibbelin, Research Writer, Triple-I
Growth in the pet insurance industry hit a record high in the first quarter of 2026, extending a run of double-digit annual premium growth since at least 2018. But while the number of pets insured is rising, more than 95% remain uninsured, according to the North American Pet Health Insurance Association’s latest report.
A recent S&P Global Market Intelligence webinar gathered subject-matter experts from across the pet insurance ecosystem to examine the challenges to closing this protection gap, driven in large part by an absence of industry data standardization.
Unlike human healthcare, veterinary care practices in the United States are not required to use standardized medical coding for billing or recordkeeping, meaning veterinary clinics may report the same health condition or procedure differently. Much of this information is also siloed within individual organizations, exacerbating data fragmentation.
Under this framework, each pet insurance claim is effectively unique, necessitating extensive manual review to process. Insurers are less equipped to track industry trends or pay claims efficiently, thereby increasing claims handling expenses. These processing delays can introduce further friction for consumers trying to navigate the reimbursement model used by most pet insurance providers, which may trigger a payout only after the policyholder has paid for the service up front.
Without greater standardization, pet owners may feel more uncertain about what services are covered, feeding into broader misconceptions surrounding pet insurance coverage and pet health overall. S&P Global’s panelists agreed that many consumers underestimate the costs associated with caring for a pet before adopting, especially costs incurred down the line as the pet ages.
As such, some families do not purchase pet insurance until their pet has developed a medical issue – at which point their policy might not cover the problem, as most exclude pre-existing conditions. Notably, identifying pre-existing conditions hinges on standardized records, adding to the uncertainty for claims adjusters and policyholders alike.
Part of the solution lies in reframing pet insurance as a comprehensive pet care solution to help protect pets during their full lifetime, rather than purely as a safety net when care is already needed. Pet wellness plans support this shift by offering coverage for preventative care like annual exams and vaccinations, filling in the gaps left by standard pet insurance policies.
Innovations in pet care technology are also transforming how consumers understand pet health. Smart wearable devices, for instance, can help monitor a pet’s vital signs continuously, generating more accurate data on pet health and behavior that veterinarians can assess to make informed decisions about their care. Long term, better data tracking sets the stage for consistent reporting throughout the industry, allowing insurers to create more flexible pet insurance products.
Only through collaboration at every level can the pet insurance landscape become better understood and more accessible. It’s important for pet owners to compare coverage, reimbursement, and exclusions. Reviewing these options with an insurance professional can help determine what works best for an individual pet and family.
Learn More:
Pet Insurance: A Growing, Diversifying Line
Dog-Related Injury Claims on the Rise in 2025
Spotlight on: Dog Bite Liability
