MetLife Adopts Pets as Growth Business -- WSJ
06 December 2019 - 7:02PM
Dow Jones News
By Leslie Scism
This article is being republished as part of our daily
reproduction of WSJ.com articles that also appeared in the U.S.
print edition of The Wall Street Journal (December 6, 2019).
MetLife Inc. said Thursday it purchased pet insurance company
PetFirst Healthcare LLC, expanding into a growing industry as it
aims to widen offerings and boost sales.
The purchase of Indiana-based PetFirst, for an undisclosed sum,
is the latest sign of life insurers' efforts to rev up revenue amid
sluggish sales of individual life-insurance policies. Pet insurance
-- which bears some similarities to health coverage for people --
has been one of the fastest-growing insurance products in recent
years.
Founded in 2004, PetFirst is small and markets primarily through
animal shelters and humane societies, the companies said. MetLife,
which will add the policies to its menu for employers'
group-benefits programs, expects "enormous scale in no time," said
Ramy Tadros, president of U.S. business for MetLife, the
second-largest U.S. life insurer by assets.
Pet insurance premium volume more than doubled in the U.S. to
$1.28 billion in 2018 from $588 million in 2014, according to trade
group North American Pet Health Insurance Association. A total of
2.15 million pets -- mostly dogs -- are insured.
Yet just 2.3% of U.S. pets are covered, the pet association's
figures show, making some industry executives bullish about growth
prospects. In contrast, almost a quarter of pets are insured in the
U.K., where the product took off decades ago, according to other
industry figures.
Much like pet owners' health insurance policies, pet insurance
bears annual premiums, deductibles and copayments tied to claims
stemming from accidents and illnesses, according to trade group
Insurance Information Institute. Nationwide Mutual Insurance,
Trupanion and Healthy Paws are among the leaders in U.S. market
share.
In the U.S., industrywide individual life-insurance policy sales
have fallen about 45% since the mid-1980s, flattening out at about
9.6 million policies annually in recent years, according to Limra,
an industry-funded research firm.
Thursday's acquisition comes despite the fact that MetLife
ditched its well-recognized Snoopy logo in 2016 as it was spinning
off most of its historic core business selling policies to American
households through agents.
The company regrouped in the U.S. selling life, dental, vision,
disability income and other insurance through employers'
group-benefits programs, among other operations. The New York
company also is considering potential acquisitions to expand the
group-benefits business, people familiar with the matter said.
Other insurers have also moved to attract more business.
Prudential Financial Inc., the biggest U.S. life insurer by assets,
in October closed on a $2.35 billion acquisition of online startup
Assurance IQ Inc., aiming to better reach digital-savvy consumers.
Manulife Financial Corp.'s John Hancock unit recently launched
life-insurance policies that include a behavior-change program and
virtual medical clinic as part of marketing to people with
diabetes.
Write to Leslie Scism at leslie.scism@wsj.com
(END) Dow Jones Newswires
December 06, 2019 02:47 ET (07:47 GMT)
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