Kogan shares soar on pet insurance announcement
[UPDATED] Shares in Kogan.com have shot up more than 14 per cent after the company announced yesterday that it intends to launch a pet insurance offer next year.
The announcement, which came a week after chief executive Ruslan Kogan unveiled a plan to launch health insurance, extends KGN’s partnership with The Hollard Insurance company, who will underwrite the service and administer it through subsidiary PetSure.
Kogan will distribute and promote the offer in return for a commission on policies sold, similarly to the deal in place with Hollard in relation to car, home, landlord and travel insurance.
The deal is just the latest in a long line of service verticals Kogan has invested in over the last twelve months, including mobile, internet and travel, after signalling a strategy to leverage the Kogan brand and its customer data to enable a wide-ranging business model.
Moving into pet insurance will also allow Kogan to capitalise on growing demand in pet-related industries as consumers begin to spend more on their animals.
Animal Medicines Australia (AMA) research from earlier this year found that more than $12.2 billion is being spent on pet products and services each year, up 42 per cent since 2013.
Kogan.com executive director David Shafer said the partnership was a “natural extension” to Kogan’s existing insurance business.
“We are excited to partner with PetSure, the clear leader in the Australian pet insurance market, to offer an affordable range of pet insurance products to our growing community of smart shoppers,” he said.
“Pet insurance is a growing insurance category in Australia, and we are happy to have reached another win-win-win partnership, enabling us to deliver great value and a variety of pet insurance products to our community.”
Kogan’s other service verticals are growing faster than the pure-play retailer had expected, with FY17 results showing that its travel and mobile businesses grew by 6.9 per cent and 3.9 per cent respectively.