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Natasha Ashton of Petplan Pet Insurance

While MBA students at Wharton School of Business in Philadelphia, Natasha Ashton and her husband Chris had to downsize apartments to afford their cat Bodey's $5,000 veterinary bill. In full research mode, the couple saw a huge opportunity in the U.S. that didn't quite exist in their native U.K., which sees 20 percent of all its pets insured.

In America, only 1 percent are insured. That led to the couple founding Petplan Pet Insurance, which has been booming since 2006. Now the couple has plans to expand globally as it becomes an industry leader.

Talk about the inspiration for Petplan:
There are over 160 million cats and dogs in the United States, and less than 1% are insured, despite the fact that spending on pets is set to exceed $50 billion this year. We saw a huge gap in the market. Our research revealed very few – and very poor – products offering little or no value for money, so we saw an opportunity to come in and build not just a brand, but an industry.

What was the biggest challenge in getting Petplan off the ground?
Getting Petplan off the ground involved a few challenges, including getting an underwriter and becoming licensed to sell policies in all 50 states, since pet insurance is regulated differently in each state.

Additionally, the industry had some image problems. We not only had to battle a lack of mainstream awareness of the industry, but where there was awareness, it was often negative, due to inadequate products in the marketplace. We had to create a concentrated marketing effort to differentiate ourselves and change our audiences’ mind, so we worked to establish a strong brand, built around our core value: “Pets come first.”

How is Petplan growing?
Since selling our first policy in 2006, we have experienced explosive growth. In 2011 we were the first and only pet insurance company named to Inc. Magazine’s Inc. 500 list, which ranked Petplan as the 123rd fastest-growing privately held company in the U.S. Our staff has increased from just the two of us to more than 70 employees, all based in our Philadelphia headquarters.

Can you provide figures for: annual revenue? Number of clients/customers? Number of employees?
We have 70 employees (not to mention all our four-legged “helpers” who come to work each day) and approximately 100,000 customers. Our annual revenue for 2011 was $27.5 million.

What resources did you take advantage of to launch Petplan?
Since we were working toward our MBAs at Wharton at the time, we used all of the resources that Wharton had to offer. We took all relevant insurance and marketing classes, and we used what we learned to build out a comprehensive business plan. Once we graduated, we took our business plan to the world’s largest, oldest and most successful pet insurance company, Petplan UK, and asked them to partner with us to make a success of the U.S. market. We also drew strongly upon Wharton’s alumni network to find experts across various relevant fields. This ultimately resulted in Vernon W. Hill (founder of Commerce Bank) becoming Chairman of the Board.

What resources did you take advantage of to grow Petplan?
Initially, we looked to markets where pet insurance was already established, including the U.K. and Sweden, and combined historical European pet insurance data with other pet industry and insurance growth statistics from the U.S. to develop our first projections.

In April 2008, Vernon W. Hill, founder of Commerce Bank and one of the greatest success stories of the last decade, joined the Petplan board as Chairman, and became a major investor in the company. We have always worked to surround ourselves with people more talented and experienced than we are, and that philosophy has been fundamental to the company’s success. Vernon Hill brought extraordinary vision and a wealth of experience that helped propel the company onto a new growth trajectory.

What key partnerships in your region or state have helped your company grow?
We have always sought best-in-class partners who live up to our promise of creating fans, not just customers. In Pennsylvania, one such partner is Capital Blue Cross, which in 2011 became the  first health insurance company to sell pet insurance to via its employee group network, as well as to its individual members.

What advantage does being in your region in PA hold for entrepreneurs?
One of the great things about the Philadelphia region is how close we are to other metropolitan areas like New York and Washington, D.C. As we expand and develop relationships and partnerships, it’s very convenient to be able to get to those areas efficiently and relatively quickly so we can meet face-to-face – even on a moment’s notice. Philadelphia International Airport is also a major hub for several domestic and international airlines, which helps us to be nimble when working with partners outside of the region.

Philadelphia has also proven to be a fantastic talent pool for us to draw from, owing in part to the educated workforce in the area. Much of our success is due to our ability to build a team of dedicated, intelligent and skilled employees – who all also happen to share our passion for pets!

Where does your region need to improve in terms of support for entrepreneurs?
We were lucky because we could take advantage of the incubator-like environment at Wharton, but not all entrepreneurs in the area has access to the tools, resources and mentorship that Wharton offers .

What's the big differentiator for Petplan, compared to others in the industry?
Petplan is the first pet insurance company in the U.S. to offer full coverage for genetic and chronic conditions as standard. Petplan is also the only pet insurance provider to offer a Covered for Life guarantee. We are also the only pet insurance provider to offer exclusive, interactive tools for pet parents, including vet-authored health tips and feature content on our website, our social media platforms. Additionally, our in-house team of experts, writers and designers create and publish a glossy quarterly pet health publication – fetch! magazine. In addition to providing fetch! to pet parents and veterinarians nationwide, it is also available for purchase at Barnes & Noble bookstores across the country.

What's next for Petplan?
We aim to become the first billion-dollar pet health insurance provider globally, whilst maintaining our reputation of delighting our policyholders by delivering exceptional service and being the leading authority on pet health. We look forward to continued expansion across North America. We really think of ourselves as a pet health company, and for us, that means pets always come first. 

-- by Joe Petrucci

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