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Attracting Millennial and Gen Z Talent with a Pet Insurance Employee Benefit

Quick look: Pet insurance is rapidly gaining traction as a sought-after voluntary benefit, especially among younger employees who are opting for furry companions over traditional family expansion. While benefits like healthcare and paid time off are vital in keeping employees happy, offering pet insurance could be a significant differentiator to attract millennial and Gen Z talent.

Are you looking for a leg up to meet the changing demands of younger employees? Offering pet insurance as an employee benefit could do the trick.

Many millennials and Gen Z are choosing to parent pets rather than humans as birth rates continue to drop. Recent research shows that millennials make up the largest percentage of pet owners, and 67% of 18- to 26-year-olds chose to get a dog instead of having a child. As such, today’s workforce is more interested in pet-friendly job perks than previous generations and wants to work for organizations that respect their priorities and offer benefits like pet insurance to prove it.

Pet insurance also packs a punch for workers with human children, as approximately two-thirds of U.S. households own a pet, and 97% of pet owners consider their pets to be part of their family. Whether employees’ families include just “fur babies” or human ones too, pet insurance provides tremendous potential value to employers, especially small businesses competing against larger corporations for talent.

What is pet insurance, and what does it cover?

Pet insurance is a type of health care policy that can provide payment or reimbursement for specific covered veterinary expenses. Although many policies cover standard wellness exams, shots, chronic conditions, and acute injuries and illnesses, coverage will vary from plan to plan.

According to the North American Pet Health Insurance Association (NAPHIA)’s 2023 State of the Industry Report, there are 5.36 million insured pets in the U.S., with pet insurance premiums reaching over $3 billion.

The report also states that some of the most common pet insurance claims for dogs and cats include:

  • Skin conditions
  • Urinary tract infections
  • Gastrointestinal issues
  • Ear infections
  • Upper respiratory infections

A closer look at millennial and Gen Z pet ownership

Millennials have tended to delay significant life commitments and financial decisions, giving them more time and money to spend on their furry friends—approximately $3,400 each year, according to Offering pet insurance is an enticing option for this new generation, who have formed unique emotional attachments with their pets.

Consumer Affairs reveals the impact pets have had on young pet parents:

  • 25% of millennials say they would sell their car to afford a life-saving procedure for their pet
  • 81% of millennials claim they love their pet more than at least one family member

However, pet ownership comes with high costs, with 17% of millennial pet owners reporting that they would be slightly or not at all prepared to pay for life-saving treatment for their pet in the next month. This is where employers can make an impact and offer a competitive advantage.

Pet insurance as an employee benefit: an opportunity to stand out

Small businesses must regularly reevaluate their benefits offerings to remain appealing to top talent and competitive against larger organizations. Research from Voya Financial shows that nearly two-thirds of workers say their benefits make them at least somewhat more likely to remain at their company, and 66% report they’re more likely to work somewhere that offers voluntary benefits, shifting these perks from “nice to have” to “must have.”

Unfortunately, these plans can be costly for small employers to obtain independently, which is another reason why working with a professional employer organization (PEO) makes sense. PEO partners may offer negotiated group rates, fixed-cost, multi-year plans, and employer contributions, at a less expensive rate than if they were to seek the same benefits on their own.

Further, 72% of employees say that the more benefits they receive, the happier they are at their jobs. And since millennials are currently the largest segment of workers in the U.S., pet insurance can be just the added benefit to keep them happy, engaged, and retained.

Consider these additional facts:

  • 70% of employees report they don’t have access to pet insurance through their employers, but 30% said having those benefits would convince them to stay with their current organization
  • Primary income earners who feel cared for by their employers are 2.3x more likely to have access to pet insurance
  • Employees who have a good experience using their voluntary benefits are 1.3x more likely to feel cared for, happy at work, and engaged, and 1.2x more likely to feel loyal and productive

Picking a partner that prioritizes pets

Working with a PEO gives employers access to cost-effective, modern employee benefit plans. Plus, PEOs’ benefits experts routinely monitor new trends and benefits—including those related to furry family members—so you don’t have to.

A PEO partner can also provide various voluntary benefits in addition to pet insurance, including:

Offering voluntary benefits like pet insurance can demonstrate to your younger workforce that you understand their lifestyle and priorities. It can also help recruit and retain top talent while ensuring they feel supported inside and outside the workplace.

The right PEO not only unlocks access to high-value employee benefit plans but acts as your trusted advisor for benefits planning, administration, and management. Contact ExtensisHR today to learn how their benefits experts can help you offer better plan designs at competitive prices. 

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