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Understanding the Demand for Pet Insurance

Author

Listed:
  • Armantier, Olivier
  • Treich, Nicolas

Abstract

Despite its rapid global growth, pet insurance remains poorly understood. This paper provides the first theoretical and empirical analysis of pet insurance demand in economics. Our model predicts that, unlike standard property insurance, pet insurance demand increases with a non-financial factor, the pet’s companionship value, and is inverse U-shaped with wealth. These predictions are supported empirically by our survey evidence. We also identify determinants and frictions of pet insurance demand, including risk attitudes, education, financial literacy, and liquidity constraints. Finally, we find that pet insurance decisions are more closely associated with health insurance, a non-property insurance, than with car insurance.

Suggested Citation

  • Armantier, Olivier & Treich, Nicolas, 2026. "Understanding the Demand for Pet Insurance," TSE Working Papers 26-1794, Toulouse School of Economics (TSE).
    • Handle: RePEc:tse:wpaper:132305
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    More about this item

    JEL classification:

    • D12 - Microeconomics - - Household Behavior - - - Consumer Economics: Empirical Analysis
    • D64 - Microeconomics - - Welfare Economics - - - Altruism; Philanthropy; Intergenerational Transfers
    • G22 - Financial Economics - - Financial Institutions and Services - - - Insurance; Insurance Companies; Actuarial Studies
    • H3 - Public Economics - - Fiscal Policies and Behavior of Economic Agents
    • Q18 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Agricultural Policy; Food Policy; Animal Welfare Policy

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