Lately, most employers are making cuts to costly employee benefits, yet additions such as pet insurance are on the rise. According to the American Pet Products Manufacturers Association, in 2007, pet owners spent $9.8 billion on their pets, a $2.7 billion increase from 2001. These days, pet owners are more likely to spend more on their pets, including treatments for diseases like cancer that can cost thousands of dollars. Now one of the fastest growing industries, pet insurance only covers 2-3% of pets, and is estimated to be worth $700 million so far, CNBC’s Jane Wells reported. With 3 out of every 5 Americans owning pets, this number is sure to increase.
Offering pet insurance can help businesses stay competitive, and show they are thinking beyond just people. Large corporations are leaning towards offering pet insurance as a benefit because it comes at no cost to them, and ends up saving their employees 5-10%. In addition, millennials are more likely to put off having children, and increasingly humanize their pets. The average premium for pet insurance is between $450 to $500 a year. Companies are leaning toward offering benefits that improve morale while still saving on costs. Studies show that bringing fur babies to work can“lead to better teamwork, boosted morale, lower stress, and higher employee retention,” according to Fortune.
“Nobody’s going to leave or stay because of it. But it shows we understand that pets are just a very, very important part of the family,” says Paul Berg, Del Monte’s vice president of compensation and benefits. Pet insurance isn’t for everyone, however. Unless your pet’s breed is prone to chronic illness, Consumer Reports says pet insurance might cost more than it saves. The key is to to plan ahead for medical care, said Dr. Thomas Carpenter, president of the American Animal Hospital Association. Additional voluntary benefits, such as pet or identity-theft insurance or even funeral-service benefits are being used to soften the blow of rising human health care premiums. This type of employee listening can not only boost employee engagement, but save money for the organization and its workforce in the long run.