Cost is a significant impediment to achieving wider coverage of pet insurance for British pet owners, while a proportionally high number of policy cancellations have occurred during the recession, largely because insurance policies fail to provide sufficient additional benefits, a new YouGov SixthSense report outlining consumer attitudes to pet insurance has found.
- Approximately 20.3 million UK residents own pets
- But our report records a weak market penetration, as only an estimated 6.6 million are policy holders.
Cost has been identified as one factor driving consumers from the market.
- Of those who claim to have cancelled pet insurance policies in the past, 29% say that the cover provided was not worth the cost
- An additional 18% of those who cancelled claimed that they required the policy but could not afford it.
Consequently it should come as little surprise that ownership is skewed towards affluent consumers between the ages of 40 and 54. Policy holders are also very likely to have bought their house on a mortgage, earning £35,000-50,000 per annum.
- Tesco Pet Insurance (24% consumer penetration) and Pet Plan (15%) are by far the most popular brands in the market.
- In terms of premiums, Allianz (Pet Plan) is the dominant player holding around 40% of the market by Gross Written Premiums.
- Some way behind comes RBS Insurance (around 30% of GWP) which underwrites the Tesco policies and also offers policies via its own subsidiaries, Direct Line and Churchill.
In addition to problems of cost, half of cancellations are precipitated by cover related issues, where the consumer no longer needs a specific policy to cover the risks (e.g. where coverage is provided by another product).
Speaking on the findings of the report Research Director for YouGov SixthSense, James McCoy identified an additional problem, saying ‘Pet insurance policies currently do not provide the same extra benefits we have come to expect from other types of insurance.
'Health and dental plans offer a number of ‘one-offs’ in the form of checkups, teeth cleanings etc. in addition to coverage for grievous injury or disease. The maintenance or cosmetic element is missing from most pet policies that might encourage a greater sign-on rate amongst owners. Why can’t a pet insurance policy, for example, include an annual booster or regular flea or worming treatments?’
He continued, ‘As a nation of pet–lovers, we would welcome the introduction of policies that give a little bit more than just piece of mind.’
Base: 2,099 nationally representative UK adults aged 16+.
Source: YouGov SixthSense Insurance Survey (3-5 August 2010)