Record numbers take out pet insurance: 5 questions to ask before choosing a policy

A record 4.4 million pet owners took out insurance last year, according to the Association of British Insurers (ABI).

The figures show a significant increase in policies over the past decade, as more owners seek to protect themselves against unexpected, and sometimes eye-watering, veterinary costs.

If you're thinking of taking out per insurance, we're here to help, with five key questions you should ask to ensure you get the right coverage.

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The rise in pet insurance policies

The ABI's data shows the number of pet insurance policies has risen by 1.7m over the past 10 years, peaking at 4.4m last year.

With more policies comes greater payouts. Total payouts topped £1bn for the second year in a row in 2023, with insurers handling nearly 5,000 new claims every day.  

A total of 1.8m claims were made in 2023, up 32% year-on-year and the highest number recorded since 2007, when the ABI began collecting data. 

• Find out more: how to get cheap pet insurance

Average payout rises to £668

The average pet insurance claim was valued at £668 in 2023, while the average annual policy cost £389.

While this might seem like a lot to fork out, the ABI's report highlighted how the cost of some treatments can run to thousands of pounds.

For example, surgery for a cruciate ligament rupture in a dog can cost between £3,000 and £5,000. Treating patella luxation (a common knee problem) in cats and dogs can cost between £2,000 and £4,000, and managing diabetes in a cat or dog can cost around £1,300 per year.

• Find out more: best dog insurance policies

Five questions to ask before buying pet insurance

1. What type of insurance should I choose?

When comparing deals, you'll need to choose between a lifetime policy or a non-lifetime policy. 

Lifetime policies offer continuous coverage for ongoing health issues, up to a set amount each year. For example, if your pet has a chronic condition such as diabetes, a lifetime policy will pay up to its annual limit every year. 

Non-lifetime policies, including per-condition or time-limited cover, only pay up to a certain amount or for a limited time. After that, you’ll need to cover the costs yourself. 

• Find out more: pet insurance explained

2. What does the policy cover?

Check what coverage is included in the policy. Most policies cover vet fees, which can range from £1,000 to £18,000 per year. 

Check if the policy also includes coverage for death due to accident or illness, which usually reimburses the cost of your pet. 

Additionally, look out for missing pet cover, which helps with the cost of finding your pet, and third-party liability, in case your pet injures someone or damages property. 

If you travel, make sure the policy includes overseas cover and emergency care if you're hospitalised.

3. What are the common exclusions?

Insurance policies come with a list of exclusions. Most commonly, many policies don't cover pre-existing conditions. This is usually defined as health issues your pet had before the policy started or during the first 10-14 days after you signed up (known as the waiting period). 

Also, most policies don’t include routine care such as vaccinations, spaying, flea treatments, or dental care unless related to an injury. 

4. How does the policy handle older pets?

For pets over eight years old, premiums are usually higher, and you may have to pay a bigger portion of each claim yourself (sometimes up to 25%). 

Additionally, benefits such as death cover, might not be available for older pets. 

Make sure you understand these terms and consider whether the policy still offers good value as your pet ages.

• Find out more: do you need pet insurance for puppies and kittens?

5. What are the alternatives to pet insurance?

It's worth considering other options besides traditional pet insurance, such as self-insuring by setting aside money for potential vet bills. 

This could save you money on monthly premiums, but there’s a risk that a big expense could exceed the amount you’ve saved. 

For example, surgery for hip dysplasia could cost around £7,000. 

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