Pet insurance pay-outs top £1bn – 7 ways to save on costs

Insurers paid out £1.23bn to treat sick and injured pets in 2024, according to the Association of British Insurers. That's up 4% on 2023 and the third year running the figure has topped £1bn.

The record claims bills is likely driven by rising vet fees. The Competition and Markets Authority (CMA) has been investigating the sector and found that treatment prices rose by 60% between 2015 and 2023, compared with a 35% rise in general service inflation.  

Taking out pet insurance can help you avoid footing a sky-high vet bill. But with policies varying in price, we’ve rounded up seven ways to cut the cost of cover.

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What were pet insurance claims for?

There were 1.8 million pet insurance claims last year, according to the latest data from the ABI. That's an all-time high and an average of 4,900 claims a day.  

Of the £1.23bn paid out in 2024, around 76% was for dogs (£933m), 19% for cats (£232m) and 5% for other pets (£61m).

Visiting the vet can be very expensive, and the costs of treating pets, including drugs and diagnostic equipment, are likely to blame for the record payouts last year. 

The cost of treating an expensive condition such as elbow dysplasia – the most common cause of forelimb lameness in young, large and giant breed dogs – can be more than £50,000, the ABI found. 

If your pet eats something they shouldn’t, such as chocolate or a small household item, treatment can set you back around £4,000. 

• Find out more: best and worst pet insurance

Is change on the way?

In September 2023, the CMA announced it was scrutinising the vet industry over fears animal lovers are not getting a good deal. At the time, the regulator found that costs were rising at a faster rate than inflation. 

The CMA is particularly concerned that consumers are not being given easy access to information about pricing and treatment options when deciding which vet to use and which services to buy. 

Following a public consultation that sparked 56,000 responses, the regulator has now outlined several ways the sector could be improved. Suggested changes include:

• Price caps on medicines, prescriptions and other services such as cremations.
• A ban on financial incentives, such as bonuses, for vets who use certain treatments.
• A ban any policies that limit vets’ 'clinical freedom to provide a choice of treatments suited to the pet owner and animal’s needs.
• A clear online display of prices for medicines, surgeries, treatments and out-of-hours help.

The CMA will now look at the results of a consultation it ran last month with veterinary professionals.

Find out more: CMA to launch formal investigation into vet market

7 ways to cut the cost of cover 

The ABI's latest data also shows a record-breaking 4.6 million pet owners took out insurance – a 3% increase since 2023 and 33% higher than before the Covid pandemic in 2019. 

While pet insurance can give you peace of mind if your animal needs expensive treatment, the price of an annual policy may still put some owners off. Quotes data from comparison site Compare the Market found the average pet insurance premium in March 2025 was £124 a year. 

But it could be higher or lower, depending on your pet's individual circumstances, such as age and breed, as well as the type of policy you buy. It may also not cover all the costs. For example, routine check-ups and vaccinations.

The good news is, there are a few ways you can keep the costs of pet cover down:

1. Look at the excess

One simple tip to reduce the cost of a policy is to tweak the excess you pay. This is the amount you immediately contribute towards any claim. 

The higher the excess you are willing to pay, the lower the premium, but think carefully about how much you can realistically afford if your cat or dog does need expensive treatment.

• Find out more: how to get cheap pet insurance 

2. Self-insure

One alternative to paying for a premium is to regularly tuck a little money away yourself, so if your dog or cat falls ill, you have an immediate pot of cash to dip into for any unexpected vet bills. With interest rates currently on the rise, consider opening an easy-access or a regular savings account. Take a look at our guide to finding the best savings account for helpful tips and advice.

The downside to self-insurance is that if your pet needs expensive treatment before you've saved enough to pay for it, you might end up in debt. Failing to get your pet insured also means you won't be covered for public liability – for example, if your dog injures another pet, the owner might sue you for vet and legal bills.  

Cats, on the other hand, are considered 'free spirits' by the law, and owners are not responsible for their actions.

• Find out more: pet insurance explained 

3. Third-party liability cover

If you are a dog owner, then one option is getting third-party liability cover only –  this will cover your costs if someone decides to make a claim against you because of an injury or damage caused by your dog, so long as your pooch doesn’t have a history of aggression. 

While most insurers offer it as standard or as an add-on, you can get it on its own by becoming a member of the Dogs Trust. The charity offers it as one of its perks for a £25 annual membership fee. Alternatively, you can pay £750 for a life membership or £12.50 a year if you're over 60.

The policy will cover you for up to £1m, and while that sounds like a lot, most insurers will usually cover you for more than that. If you end up being sued for loss of earnings, costs can spiral, and you might need that extra financial safety net.

4. Free vet treatment

If you on a low-income, you may be entitled to help from charities such as the PDSA, Blue Cross and the RSPCA.

Pet owners on certain means-tested benefits can get free or subsidised veterinary care, although the charities may ask you to donate something towards the costs. Get in touch with the charities directly to find out if you meet the eligibility criteria.

5. Multi-pet policies

Own more than one pet? It might work out cheaper to get a multi-pet policy rather than insuring each individual animal.

You're usually allowed to add up to six pets on one policy, and there's often a discount for doing so. You'll get the same amount of cover as a standard single-pet policy.

But there are a couple of snags to watch out for. Changing the cover level at renewal will mean it changes for all animals included on the policy. This could be a problem if you need different cover for each individual pet.

Also, sometimes insurers say ‘multi-pet’ when in reality it is just individual policies linked together. And finally, make sure you compare the price of individual and multi-pet policies – just in case it doesn't work out any cheaper.

6. Shop around and always read the small print

Whether you are renewing or buying a new policy, it's always worth shopping around.

Price comparison sites, which allow you to view multiple pet insurance quotes at a glance, are a good place to start.  

Once you're on the insurer's website, check the policy details again, just to be sure the insurer has received all the correct information about you and is providing an accurate quote.

And remember, no matter what your policy, it's important to check the small print for any caveats that may come back to bite you in the wallet when it's time to claim.

7. Use Which? to research the best provider and policy

Once you've found a deal that is right for you, check how Which? rated the provider and policy. 

Which? Best Buys are awarded to policies that stood out in our analysis as offering particularly high levels of cover and can help you choose the right cover for your pet. 

We've also surveyed customers to find out how they rated their provider to reveal the best and worst pet insurers.