With ASPCA Brand, MGA Sees
Fourfold Growth Rate In Pet Niche
Past issues with transparency, profitability tackled through marketing partnership, data mining
■ FOUR-LEGGED COVERAGE
BY CAROLINE MCDONALD
ALTHOUGH PET INSURANCE used to be a line of coverage that did little for pet owners and proved difficult for
insurers as well, one company believes it has
found the recipe for success in the niche.
“It all comes down to the underwriting and being a fair deal to the customer,”
says Dennis Rushovich, CEO for Hartville/
ASPCA Pet Insurance in Canton, Ohio.
As more people buy, pet insurers are
able to offer more benefits, he adds. “The
products have continuously improved, and
the industry as a whole has improved.”
The pet-insurance industry has “be-
come more transparent to the consumer,”
Rushovich says. “We try our best to explain
what is and what isn’t covered.”
E PET OWNERS FACING the choice of a $4,000 vet bill vs. euthanizing their pet have a tough decision—unless they have pet insurance.
“We have a good brand to
market under—and good mar-
keting,” Rushovich says, not-
ing that his firm has seen 300
percent growth in the last five
years, also attributing the spike
to continual product improvements.
From an underwriting profit perspective,
the success of the product hinges on the com-
pany’s claims data—about 12 years worth.
Pricing factors include the animal’s
breed and age, among other things, Rush-
ovich says. “For example, a bulldog is much
more prone to illness than a poodle.”
To deliver its pet-health policy offerings
covering dogs and cats, Hartville works with
Fairmont Specialty, part of the Crum &
Forster Group. Hartville, through a wholly
owned MGA subsidiary known as Petsmar-
keting Insurance.com Agency Inc., does the
marketing, pays claims and handles cus-
tomer service—“all the things a managing
general agent would do,” Rushovich says.
“We market pet-insurance products under our name, as endorsed by
the ASPCA,” Rushovich says,
noting that in March 2006,
an exclusive strategic-partner
agreement for pet insurance was
signed with the ASPCA (The
American Society for the Prevention of Cruelty to Animals).
PET INSURANCE SELLING POINTS
According to the ASPCA website,
ASPCA Pet Health Insurance
That meant marketing of the
product migrated to the ASPCA
E Getting reimbursed 80 percent
of usual and customary cov-
Pet Health Insurance brand.
E Choosing from four available
levels of coverage: accident,
illness, wellness and wellness-
plus offering increasing levels of
protection, as well as optional
coverage for ongoing conditions.
E Saving 10 percent with a
excluding level-one and
E Meeting only a low $100
annual deductible per pet.
According to the website, the pet
insurance has a $100 deductible
per pet that needs to be met once
a year, rather than per incident.
More information is available at
E Using any licensed veterinarian
in the U.S. or Canada.
E Tracking claims and updating
Photo by Getty
“a veterinarian in Manhattan obviously is
going to charge more for services than a
veterinarian in Idaho.”
Explaining the use of the pet’s age as
a pricing factor, he says that, just like hu-
mans, as the pet gets older, their medical
treatment costs rise.
In determining individual rates, a base
premium has been established and surcharges based on the criteria are factored
in. Policies are then closely monitored.
Rates are assessed and set annually.
“We continually look at our breeds. Sometimes we bump up surcharges; sometimes we
can reduce surcharges for certain breeds,” he
says. ZIP codes are monitored as well—in case
costs begin to rise in an area or the owner of
the pet moves to a new location.
For mixed breeds, “we typically ask for
the predominant breed,” he says. When
this isn’t evident, there is a separate class
labeled “mixed breed.” Typically, Rushovich explains that the mixed breeds perform better “because with pure breeds
you get inbreeding,” which can lead to
congenital and hereditary conditions.
In addition to being a revenue source for
the ASPCA (through royalties for use of its
trademarks), the coverage furthers the association’s mission,
Rushovich says, noting that
people who have pet insurance
People facing the choice of
a $3,000-$4,000 vet bill vs. euthanizing have a tough decision, especially in the current
economy, he says. “If they’ve
got pet insurance, it obviously
saves the animal,” which is the
mission of the American Society
for the Prevention of Cruelty to
Animals—a nonprofit organization which gets most of its revenues from donations. NU
April 18, 2011 | National Underwriter Property & Casualty | 19