Increasing numbers of pet owners are insuring their four-legged friends, a report claimed today.
The income from pet cover premiums increased by 17% during 2007 to reach a record high of £440m, according to market analyst Datamonitor.
The group expects the market to continue growing between now and 2012, with the annual level of premiums written rising by 58% to reach nearly £700m.
Cats and dogs
The group said the key driver behind the growth in premiums so far was the steady increase in the number of people taking out cover for their pets, with 26% of cats and dogs insured by the end of 2007.
Pet cover has evolved to become a mainstream product in recent years, available through a range of channels, including direct from insurers, as well as through brokers, supermarkets and vets.
But premium income has also increased as a result of insurers hiking the cost of the cover in the face of rising claims bills due to the increasingly sophisticated treatments now available for animals.
Report author Andrew Haslip said: ‘Increased consumer uptake of the product along with premium rate increases to cover high claims inflation have combined to make this one of the fastest growing insurance markets in the UK.’
Datamonitor is forecasting growth of 8.7% a year in premium income during the coming five years, driven by a steady increase in the number of policyholders with the product.
But it added that growth in the number of people with the cover would be slower than in the past as the market reached the lower end of its saturation point.