Why does the cost of pet insurance change at renewal?
Let’s start by explaining how insurance works; the main feature of insurance is that everybody pays a little, so that no one pays a lot.
And insurers have to predict how many people will need to use their cover to decide what everyone’s contributions should be.
The main reasons your price can increase over time are:
1. Your pet’s age. Just like humans, as pets get older they’re more likely to need medical care and pets age much faster than humans! This is why your insurance costs rise as your pet gets older.
2. Another reason is our health prediction for your your pet’s breed. Each breed of dog or cat is different, and they tend to be affected by different conditions. We regularly review how likely it is that a breed will develop a condition and that affects the premiums you pay.
3. Inflation also affects your insurance and this is particularly relevant in the current economy. As vet practices face higher costs, these are passed onto both pet owners and insurers in higher fees.
4. The final reason is that better and more sophisticated treatments become available each year, and these treatments are often more expensive than the ones they’re replacing.
For example, it’s now common for cancer treatment in pets to look remarkably like cancer treatments for humans. The same goes for diabetes. These more expensive treatments push up the cost of insurance.
To summarise; the amount you pay is likely to change at each renewal because of:
Your pet’s age
Health predictions for your pet’s breed
Increasingly sophisticated vet treatment
We understand price increases are difficult for everyone so we try to minimise them wherever possible, while still providing great cover when you need it.
Do pet insurance prices increase after a claim?
Making claims can affect your renewal price as this will affect our health prediction for your individual pet.
At the end of your policy, we’ll review the claims you’ve made to understand whether your pet is more or less likely to need treatment in the coming year and adjust your price based on this.
How much does pet insurance increase each year?
According to the Association of British Insurers (ABI), the average pet insurance premium was £271 in 2020. It's likely the ABI is looking at mix of premiums for cats and dogs of all ages.
Younger pets cost less and dogs cost more to insure. It's not uncommon for annual cover for dogs to cost over £500.
With the cost of treatment rising sharply in recent years, the average claim has increased to £848 in 2021, compared with £817 in 2020.
The ABI also said that, in 2021, 4.3 million pets in the UK were protected by pet insurance and over 1 million claims were made.
With so many people buying pets during the pandemic in 2020 the price of pets shot up. The price of a cat or dog will affect their insurance premium so it's likely the average pet insurance premium increased.
It's impossible to predict how much someone's pet insurance premium will increase each year. Each insurer uses different rating factors to decide their prices. But there are a number of known factors that can affect your price. Pet insurance costs more in cities and the South East of England so if you move to London you're likely to end up paying more.
And prices are likely to increase more steeply when your pet is older than seven or eight. And for some breeds prices can start to increase at younger ages.
What can I do when my pet insurance is up for renewal?
You might come to the conclusion that the renewal price is fair, though higher, and you are happy to stick with your current insurer. In which case you might not want to take any action.
Generally speaking, if your pet needed treatment for a serious injury or illness in the past, it can be worth sticking with your current provider.
Most pet insurance policies do not provide cover for pre-existing conditions and a new insurer will most likely decline a claim if your pet already had the condition before the policy was taken out.
All ManyPets vet fee policies cover conditions that ended at least two years ago and we have a policy that covers more recent pre-existing conditions.
It's important to understand the cover you will get for an existing condition when you switch insurers so make sure you read the policy documents or speak to the company.
On the other side, if the increase in price doesn’t seem to be justified, don’t be tempted to give up.
If you can find the cover you need from another insurer you could shop around. And if you find a lower price elsewhere, don't be afraid to negotiate with your existing insurer.
At ManyPets we have removed the 14-day exclusion period for pet owners wanting to switch from their existing insurer. This means that as long as you switch straight from your existing insurer to ManyPets with no break in cover, then we will pay vet fee claims in the first 14 days if you need to claim.
Pet insurance might be expensive but it can give you peace of mind - by paying an insurance company a set amount monthly or yearly, you don’t have to worry about covering the costs of expensive vet treatment yourself if your pet becomes unwell or is in an accident.
As with all your finances, it’s worth reviewing your pet insurance regularly.