An increasing number of pet owners are taking out pet insurance to cope with rising medical bills from veterinary hospitals.
The trend reflects a rise in the number of people living with dogs, cats and other animals rather than children and partners amid the nation's low birthrate and rising life span.
Anicom Insurance Inc., a Tokyo company selling pet insurance policies, started selling Dobutsu Kempo (animal health insurance) policies in April and announced that contracts had topped 110,000 by September.
Animal hospitals are given a free hand in determining medical fees.
Under Dobutsu Kempo, pet owners pay premiums depending on the kind of pet and its age and half of the medical expenses are covered by the policy.
An insurance premium for a 5-year-old poodle costs about ¥37,000 a year, and the dog can receive medical treatment at any hospital in the country. At about 4,000 hospitals with which the company has contracts, the pet owner shoulders only a portion of the fee and, if carrying a "medical treatment register," similar to a human health insurance card, does not have to fill out an insurance claim.
Pet insurance has been an unauthorized product because under the Insurance Law revised in 2006, companies are unable to sell insurance unless they obtain a license as insurers or register as a "small-sum, short-term insurance business."
Last December, Anicom obtained a license for a nonlife insurance business and started selling pet policies.
Fuji Keizai Co., a private market research company in Tokyo, anticipates that pet insurance contracts to be concluded this year, including unauthorized ones, will total 421,900.
An Anicom official said, "We would like to switch about 300,000 contracts concluded before we obtained the license to formal insurance policy contracts by the end of this year."