Companies that offer pet insurance as a benefit: what it really costs the employer
- Benefits cost per employee a year
- $11,900
- Per employee a month
- $991.67
- As a percent of base salary
- 19.2
The numbers on this page come from the inputs you enter and the method stated: 3,600 seconds to an hour, 52 weeks to a year, twelve months to a year, and nothing else. No industry shrinkage figure, no occupancy benchmark and no assumption about your attrition; every one of those is yours to enter.
Pet insurance turns up on benefit lists because it is cheap to offer, easy to announce and almost never administered by the employer at all. In the common arrangement the employer negotiates access and a discount and the employee pays the premium by payroll deduction, which makes the employer's cost the administration rather than the cover. This page sets out the three arrangements that exist, what each costs, the share of a workforce that can use it, and the one thing to check in the policy before you announce it.
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Do some employers offer pet insurance as a benefit? Yes, in three arrangements
Voluntary access, where you negotiate a group discount and the employee pays by payroll deduction, which costs you administration and nothing else. Employer contribution, where you pay a fixed amount toward the premium and the employee pays the rest. And fully employer-paid, which is rare and expensive. Most employers announcing pet insurance are doing the first, and it is worth being clear internally that the benefit is access to a discount rather than cover you bought.
Work out the share of your workforce that can use it
Pet ownership is high across US households but it is not universal, and the benefit is worth nothing to the people without an animal. That makes it a minority benefit like childcare support or fertility cover: genuinely valuable to the people it fits and irrelevant to the rest. Before announcing it, ask how many of your own people would use it, because the same administration effort spent on something everyone can use buys more perceived value.
Read the exclusions before you announce anything
Pre-existing conditions, breed-specific exclusions, waiting periods and annual caps are where pet policies differ most and where the complaints come from. An employer that announces a benefit and then has an employee discover their animal is excluded has spent goodwill to create a grievance. Read the exclusions, and communicate them in the announcement rather than leaving them for the first claim to reveal.
Price the payroll mechanics of employer sponsored pet insurance
A voluntary deduction is a deduction: it has to reach payroll on time, change when the employee changes cover, and stop when they leave. That is the work, and it is small but real. Count it, put it beside the share of people who will use it, and decide whether it is a better use of the same administration effort than another benefit. The free worksheet works the package cost per employee from your own numbers.
Will it do what you need for Companies that offer pet insurance as a benefit?
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Companies that offer pet insurance as a benefit: common questions
Do some employers offer pet insurance as a benefit? Yes, and usually as voluntary access: the employer negotiates a group discount and the employee pays the premium by payroll deduction. Employer-contributed and fully employer-paid arrangements exist and are much less common.
What does employer sponsored pet insurance cost the employer? In the usual voluntary arrangement, only the administration of the payroll deduction. Where the employer contributes, it is whatever fixed amount per enrolled employee you agree, which makes the cost a function of uptake rather than headcount.
Is it worth offering? It is cheap and it reaches a minority. That is a reasonable trade if you have established that the minority in your own workforce is large enough to notice, and a poor one if the same administration effort could go to something everybody can use. Ask your own people first.
What is the most common mistake? Announcing it without reading the exclusions. Pre-existing conditions, breed exclusions, waiting periods and annual caps are where these policies differ, and an employee discovering an exclusion after the announcement is a grievance the benefit created.
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