Pet Insurance

Justin and Brandy Besemer were newly married and trying to pay off their wedding debt when they decided their family needed a dog -- an American Bulldog named Kaila. Thus started one of their first arguments. Brandy, who had never had a dog before, wanted to spend a little over $300 a year to buy pet insurance. Justin, who had always had dogs, thought it was a waste of money. "His parents told me this horror story that made me insist we get it," explained Brandy, 28.

An Arizona insurance firm said Monday it has agreed to purchase up to $4 million of nonvoting preferred stock in Anaheim-based Veterinary Pet Insurance, which issues insurance policies covering dogs and cats. "Pet insurance is a relatively young industry that has seen tremendous growth the last couple of years," said Mike Miller, vice president and treasurer of Scottsdale Insurance Co., which is acquiring the preferred stock.

Listening to clients like Jon Snyder, you'd think Veterinary Pet Insurance Co. would have the cat and dog world on a short leash. Policy in hand, Snyder went to Anaheim-based VPI "crying like a big baby" when Jenna, one of many Great Danes he has owned, was diagnosed with bone cancer in her right front leg. His veterinarian was talking about amputation for a dog so active that her nickname is "Roadrunner."

Those pesky health problems plaguing Poochie represent a rapidly growing market for insurance. Veterinary Pet Insurance Group, an Anaheim insurer, covers 75,000 dogs and cats--twice the number of two years ago--in 39 states. And there's surely more to come, with the company expecting to get approval to market its policies across the rest of the nation this year. "As the awareness is building that pet insurance is available, more and more pet owners are taking advantage of it," says Rebecca F.