The nation’s historic love affair with our pets is well documented, and it comes as no surprise to learn that most of us will do whatever it takes to ensure the continued health and wellbeing of our best furry friends, irrespective of price. However as the latest research indicates, the costs of keeping the UK’s millions of our pampered pooches and fussed over felines in fine fettle is on the increase again as pet insurance premiums shoot up. According to figures released by the Financial Ombudsman Service – the independent financial services watchdog which has accumulated a record number of complaints from concerned pet insurance policyholders – it’s the otherwise popular ‘lifetime cover’ policy which has drawn the most consternation from pet-loving consumers, keen to safeguard their domesticated animal’s wellbeing for the long term.
As reported by www.telegraph.co.uk/finance/personalfinance recently, the FOS has handled 790 officially registered complaints from disgruntled pet insurance policyholders this past 12 months, an insurance product which typically leaves a lot of consumers a little hot under their collars. A spokesperson for the Financial Ombudsman Service recognises the often distressing nature of complaints garnered by pet lovers, who are always willing to go that extra mile to protect their beloved animals from various eventualities. Talking to the Daily Telegraph they commented; “People care deeply about their pets and will do anything to save them if they’re ill.” Yet it seems some insurers are almost preying on the sensitivities of pet owners, which is possibly why we’re seeing a 10% rise in complaints filed in 2014 figures. Unfortunately only in one out of every three cases brought before the FOS to rule on results in favouring the policyholder.
As the broadsheet reports, one dog owner from London witnessed her existing pet insurance premiums spiral by a staggering 610% after the first year, while others routinely confirm increases in the region of 620%. In the individual case of Henry, a 3-year old cocker spaniel owned by Mrs Carr, she arranged a lifetime cover policy through Axa Insurance in 2012 when her dog was a puppy, which initially cost her £321 annually, divided into monthly payments of in the region of £26. Unfortunately Henry experienced health issues during that first 12 months which required three separate claims being made by Mrs Carr, which the owner believed to be worth around £850. Yet when her lifetime cover pet insurance policy came up for renewal the following year she was quoted £2,283 annually, which amounted to a sum of £190 monthly. Understandably shocked by the sharp and seemingly unprecedented price hike, Mrs Carr rightly questioned Axa about the renewal price, only to be duly told that it was accurately based on Henry’s breed, age, location, and claims history. Justifiably enraged by this, Mrs Carr reasoned that she hadn’t moved house in the meantime, had only claimed on the insurance policy a handful of times while also arguing that Henry was only 1 year’s old at the time.
Lifetime Cover Pet Insurance Should Mean Just That, but Rarely Does According To Leading Policy Providers
Mrs Carr isn’t alone in acknowledging record premium price increases which are generally hard to accept let alone swallow for Britain’s pet owners, as large numbers of pet owners have observed their premium rise sharply and unexpectedly despite signing up to lifetime plans on the proviso that they’d be covered so long as they renewed their cover with the same insurer. What’s more, Axa’s name seems to have cropped up on many an occasion as annoyed policyholders have made their feelings known by approaching the FOS. However we learn that these shock price increases took effect two years ago, and in the direct aftermath of the mainstream insurance provider announcing its (then) decision to pull out of the pet insurance market in its entirety, citing it was re-focusing its efforts on what it referred to as its core insurance product, namely home, motor and travel policies. It appears that a number of Axa-providing pet insurance policyholders are still in a state of flux as up to 10,000 customers are still being transferred to NCI Insurance, with the transition not expected to be completed until the end of August this year.
Seizing on the subject of lifetime cover in terms of pet insurance practice and leading UK animal insurance provider, Petplan urged people to always check the small print on pet insurance policy documentation, as there’s often get out clauses discovered within. According to Petplan lifetime cover should actually mean cover that lasts the pet’s entire lifetime, but they are the first to admit that this isn’t the case in many instances. Addressing lifetime insurance plans and Petplan agree that it’s the individual insurer’s prerogative to increase premiums based on the claims history of the particular pet, as well as taking into account its age, yet stresses that wording is paramount so as to avoid any potential conflicts of interest at a later date. Petplan themselves for example clearly state that they offer; ‘much-needed peace of mind that your pet will be covered throughout his or her lifetime, as long as you renew each year.’
For their part, pet insurance providers are arguably throwing the blame back at the doors of vets, and claim that their fees are escalating by 10% – 15% a year, hence why they are pushing up premiums to reflect this. Vets are subsequently implying that the government is more, albeit inadvertently, culpable for impacting their price rises, with the British Veterinary Association insisting that they now have to pay medical professionals more because they are leaving their academic studies with huge tuition fees; therefore necessitating these increased salaries. Meanwhile technological advances in pet healthcare are also said to be partly responsible for price hikes being passed on to pet insurance policyholders. Along with Axa, insurance giants like Lloyds and Halifax also pulled the plug on pet insurance policies (in 2011 in their cases), again expressing their intentions to concentrate more on their home, motor and travel divisions while also being routinely viewed as ‘increasingly non-viable’ as an insurance product, a belief echoed by the FOS. Essentially, the less pet insurance providing competitors operating at one time, the greater the chance of insurance premiums being raised to justify the product.