Walmart teams up with Petplan to take the plunge into pet insurance. Can Walmart take the pet insurance market mainstream?

Amid the Pandemic Puppy Boom, Walmart is taking the plunge into the U.S. pet health insurance market. The mega-retailer’s decision to get into the pet insurance business — still a niche industry in the United States with less than 2% of pets covered by an insurance policy as of 2017–may be a gamechanger.

Can Walmart take the pet insurance market mainstream? Although its growth rate has been on a consistent incline, America’s pet insurance industry covered less than 2% of U.S. pets as of 2017 and remains a niche market.

Late last week, Arkansas-based global retailer Walmart unveiled Walmart Pet Care, “a full-service, omnichannel pet care offering that makes holistic care easy, simple and affordable for the 90 million pet owners who shop at Walmart,” the company’s press release promised. The retailer “is leveraging industry-leading providers to bring customers trusted pet care programs in one place, including Walmart Pet Insurance and convenient pet care services like dog-walking and pet sitting,” the statement added.

The new Walmart insurance product — including customer service, claims processing, claims disputes, etc. – is being administered by insurance provider Petplan, which was acquired by private equity firm Warburg Pincus last fall. That’s when Paul Guyardo was asked to stay on as CEO.

“We are the most comprehensive pet insurance you can get…”

The Canine Review spoke with Guyardo yesterday about Walmart’s debut on the pet insurance stage, as well as Petplan’s collaboration with The Dodo (‘Fetch by The Dodo’), the latter of which will not be launching until later this spring. “We are the most comprehensive pet insurance you can get,” he said. “We cover all kinds of things that either Trupanion excludes or puts into a rider,” he added when asked what makes the Walmart insurance product unique. “I think, at the end of the day, what [Walmart] is all about is providing great value to their customers” and Petplan, he says, shares that mission.

Walmart/Petplan value versus Trupanion service

Trupanion has been a particular source of frustration for competitors, largely because of Trupanion Express, a software product that facilitates rapid claims processes and enables Trupanion to pay a veterinarian on the spot. In 2019, Trupanion sued competing pet insurance provider Embrace after it attempted to develop its own version of the software. Trupanion’s was successful, arguing that Embrace was infringing on its patent. To this day, Trupanion is the only pet insurance provider with the ability to process claims within minutes, often at the conclusion of a pet’s visit to its veterinarian and, importantly, before the owner is asked to pay the remaining balance. Reliable, seamless customer support and claims processing is the heart of Trupanion’s sell.

Trupanion, like much of the pet industry, has continued to succeed and dazzle Wall Street, even during the darkest days of the pandemic. On October 29, the Seattle-based Trupanion reported $99.4 million in subscription revenue for its third quarter ending September 30, an increase of 20% compared to the same period in 2019. 552,909 pets were enrolled in Trupanion policies as of September 30, 2020, an increase of 15% compared to the same period in 2019.

Petplan (which will become ‘Fetch by the Dodo’ later next year) currently has about 250,000 subscribers, according to Guyardo.

Stay tuned for much more reporting in our upcoming pet insurance deep-dive, which focuses on pet insurance startups and how these providers compare to each other as well as to America’s two largest providers of pet insurance, Trupanion and Nationwide.