When a kind of animal is upgraded to serve as a companion to humanity, as you said dogs and cats were, do they then move from having a group soul to an individual soul?

This is exactly what happens. This is part of the upgrade process. To give them the extra human-like characteristics, they must have a soul reconfiguration. This must then be individualized for them and that is the reason for the soul upgrade—it is to imbue the upgraded soul characteristics to manifest as behavior and to create a more gentle aspect of the being so they will fit with human society and not have as strong a tendency to bite or have other aggressive displays of behavior as a primary response to any stressful act. This gives them the ability to carry out their mission as love bringers as it requires a higher self as well to help guide the animal on their mission and impulse them with specific instructions at times to facilitate the assistance to humans they live among. As you know, most animals do not have a higher self per se, as an individualized soul extension.