Taking care of Fido is getting more expensive, and for many Americans, it’s becoming out of reach. Nationwide Pet, the country’s largest provider of pet insurance, announced it’s dropping roughly 100,000 policies between now and next summer. This decision comes as a result of escalating veterinary costs, a trend that mirrors the rising costs of other types of insurance, including homeowners and vehicle insurance.
Nationwide attributed the move to “inflation in the cost of veterinary care and other factors,” explaining that these changes are necessary to ensure the financial sustainability of their pet insurance line of business. Impacted policyholders will be notified in writing.
While acknowledging the disappointment this will cause for pet owners, Nationwide emphasized their commitment to providing coverage for the duration of existing policies. “We certainly empathize with the disappointment many of our pet families feel and will fully stand by the protections for which they have paid through the end of their current term,” the company stated.
These rising insurance costs are a double whammy for pet owners. They’re already facing the strain of persistent high inflation, and now they’re confronted with the fear of “economic euthanasia,” where they may be forced to euthanize their pets due to financial constraints.
The soaring cost of pet insurance reflects a broader trend of escalating costs across the insurance sector. Vehicle insurance premiums have risen by 20.3% in the past year, according to the latest Consumer Price Index data. This increase is attributed to rising car repair costs and a surge in severe car accidents.
The home insurance market is also experiencing significant upheaval. Climate change is driving more frequent and severe weather events, such as hurricanes, storms, and wildfires. Insurers, particularly those operating in regions most impacted by extreme weather, are responding by raising premiums or withdrawing from the market altogether. This directly affects the affordability and availability of home and fire insurance.
Last year, homeowners insurance costs in the United States increased by roughly 10% to 12%, according to Mark Friedlander, spokesperson for the Insurance Information Institute. The higher costs insurers face, driven by increased replacement costs and re-insurance premiums, are being passed down to consumers. In states like California and Florida, insurers have temporarily suspended issuing new policies altogether.
