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Choosing Pet Insurance

Tips on what to look for...

What’s the point of insurance? Why would anyone purchase something with the intention of never using it? It sounds like a complete waste of money – especially if the amounts involved are substantial! But we all know that veterinary bills can be eye watering, so it's no wonder that about 40% of owners have pet insurance. Policies can vary widely which means that it is very important to get the right cover for your dog first time. Julia Carr explains how it works and what to look for.

Most people are on the whole, fairly optimistic. We need to be to have any potential of a normal life, so we drive our cars, cross roads, fly on aeroplanes, move pans of boiling water – in short, we do things that involve a degree of risk because we know that the chances of anything awful happening to us are pretty slim. The concept of insurance is therefore rather contrary to how we usually behave because it forces us to consider that ‘what if’ possibility. Because we don’t really want to think about using insurance, we buy it grudgingly, focussing on what it costs rather than what we are gaining from it. A significant portion of the industry is even marketed on the basis of saving customers money, rather than promoting the benefits of the cover and with so many companies competing for business, shopping around for the cheapest quote has never been easier.

The purpose of insurance is not to protect ourselves or our belongings from harm, but to assist if the worst should happen. In this respect its most notable benefit is to provide peace of mind. Most policies provide cover for multiple risks and the primary cover for pet insurance is almost always for veterinary fees, although there are a few (dog only) polices which just cover liability. There are more pet insurance policies available than ever and the choice can be daunting, as well as the cost. On the surface it may be tempting to simply select a policy on the basis of premium and the headline cover promises. However consumers should always pay close attention to the dreaded ‘small print’ of any insurance policy and this is especially true for pet insurance, because the devil really is in the detail and making the wrong decision can have considerable long term consequences.

What is on offer?
Most companies now offer lifetime cover, reflecting owner demand for longer term insurance so it is much easier to get cover for chronic conditions. Check the definition carefully! The veterinary fees limit may be per year, or per condition and there is a substantial difference between the two. More rarely, cover is offered per condition per year. Fixed duration cover may be renewed annually but it will only cover the cost of treatment for any condition for one year. There are also a few accident only policies which offer basic cover and are considerably cheaper.

Many insurers have detailed explanations on their websites which are worth reading, as choosing an appropriate type of policy is the first decision to be made. In general, policies that cover ongoing conditions with an annually refreshed allowance for vet fees are regarded as the 'top tier.'

No animal NHS
The principle concern for most owners is to ensure that significant and unexpected vet bills are covered. Advances in veterinary medicine have expanded the array of treatment options, but the provision of specialist care can be expensive. It is worth researching the costs of treating commonly occurring conditions and injuries (such as arthritis and cruciate ligament surgery) to predict the level of cover that might be required. The average maximum cover for vet fees is currently about £6-7,000 with some policies covering up to £15,000.

It is extremely important to read the policy booklet for this section as there are variations on the types of treatment that different companies will cover. Routine treatment (worming, insecticides, and dental work such as cleaning) is invariably excluded, as is preventative neutering. Conventional treatment is always covered, but most policies carry some restrictions or limits for complimentary treatments (e.g. hydrotherapy).

Treatment which might be regarded as excessive or unnecessary is frequently excluded. Home visits and even hospitalisation may fall within this category if a justifiable medical reason cannot be given. Some policies include cover for behaviour related referrals and behaviour treatment products such as DAP collars and diffusers, but only if purchased on the advice of a veterinary surgeon. Referrals to specialists are generally covered under the normal limits for vet fees, but check the policy wording as some insurance companies may preclude referrals unless the practice has been approved by the company.

Medical history
Almost all pet insurance policies exclude cover for pre-existing medical conditions and owners should check the definition of a pre-existing condition in the policy booklet before deciding to purchase. Some policies could potentially exclude any medical condition treated or observed during the entire course of the animal's life. For instance treatment for a bout of sickness and diarrhoea in a puppy could possibly result in an exclusion for claims for any gastro-intestinal disorders later in life. Others define pre-existing medical conditions as anything suffered within the previous 24 months, which seems more reasonable.

A claim does not have to be made for a condition to be excluded and as a word of caution, anything recorded on the pet’s veterinary record might be considered as a pre-existing condition, even if no treatment has been given. It is important to consider any previous veterinary treatment, however insignificant, when taking a new policy or switching providers. For instance some policies will exclude conditions that may reoccur in a different limb – e.g. cruciate ligament injuries.

Not covered
Not all insurance companies will cover Administration costs - so vet fees for filling out a claim form might be excluded. It is also worth checking if claims are paid directly to the vet or will the owner be required to pay the fees up front and then claim the money back.

The policy EXCLUSIONS are of critical importance and should always be read to ensure there are no unpleasant surprises at claims stage. There will be general policy exclusions and more specific exclusions that are relevant to each section of the cover. Pay particular attention to the general exclusions as there may be restrictions for dogs used for working, breeding guarding or racing and also those that accompany their owners to work. If the definitions are not explicit, this could be problematic so beware of ambiguous policy wording and if in doubt, CHECK with the insurer before making a commitment to buy.

Owner contributions
Eexcesses are well worth paying attention to. Fixed excesses mean that a set amount is deducted from the settlement of the claim but many insurers also ask for a percentage contribution instead of or on top of the excess, especially once the pet reaches a certain age. (The policy wording will state whether this is calculated prior to or after any fixed excess is deducted.) A 20% contribution on a £1000 claim is £200. Some insurers allow customers to select an excess which best meets their needs. A higher excess contribution will reduce the premium but the money must be available if required.

Customer Experience
Reviews are worth reading, but take these with a pinch of salt. People are far more likely to post a bad review to vent their feelings, so ratings and scores alone only tell a partial story. In many cases, dissatisfaction is down to unrealistic expectations or a failure to check the policy cover. Reviews discussing Renewal Premiums where no claims/changes have been made are most useful, as they can give an indication into likely premium increases. Pet insurers are well aware that owners are often reluctant to change companies, especially following a claim for a potentially reoccurring condition. Premiums which are initially low can rise dramatically over subsequent years leaving owners tied to policies that they might struggle to afford.

Conditions of cover
Vet checks and vaccination: Some insurance policies appear very enticing with reasonable premiums, good cover and fair excesses but the policy wording may reveal some pitfalls. For instance, a claim may be declined if the pet has not had an annual check-up (presumably for any condition that MIGHT be picked up during a routine examination - e.g. arthritis, heart disease etc.) Insurance companies understandably won’t pay claims for diseases preventable by vaccination if the dog isn't vaccinated - but check the policy definition as some insist upon annual vaccination while others require compliance with recommended intervals.

Beneath the surface
Make a point of checking the policy underwriter. It is often possible to identify similarities between policies and this is frequently because they share an underwriter, even though the cover may be quite different. It is useful to do some research into the underwriter’s reputation, particularly with reference to pet insurance (underwriters generally cover multiple types of insurance products).

Comparison websites are popular and useful but not all companies use them and many insurers do not appear on all websites. They are a good starting point but always visit the insurer’s own website and check for any variations - some excesses and covers are not included in the initial quote and there may be different policies on offer.

Waiting time
Finally it is worth noting the initial exclusion period, especially when changing policies. This can vary so beware. Illnesses are usually excluded for the first fourteen days of cover but accidents may be covered sooner, sometimes within as little as 48 hours of taking out the policy. Unlike car insurance, pet insurance policies can legally be overlapped so there is no break in cover. As always, check with the insurance companies for any terms and conditions that may be relevant if two covers are briefly in force together.

The Policy Booklet
In summary, when choosing a pet insurance policy it is absolutely vital to read the policy booklet itself, not just the selling points on the website or even the key facts. If anything isn't clear, check with the company before committing and ensure that the answer is sufficiently explicit to remove any potential doubt. Many companies offer enticing ‘gifts’ to new policy holders but these can really be disregarded as a deciding factor unless two policies are equal in all other respects. Specialist pet insurers may appear to be the obvious choice over policies provided by supermarkets and chain stores but surprisingly this is not necessarily true as the non-specialist policies can contain fewer conditions and exclusions. It is often helpful to make a list of ‘needs’ and compare policies against each other in a tick/cross fashion to ensure all the priority criteria are covered.

Choose wisely!
Look upon pet insurance as a long term contract rather than anticipating switching providers annually and consider what it offers relative to the lifestyle of the pet and the owner’s circumstances. A few specialist pet insurers offer free limited duration cover for puppies and some rehoming organisations will also provide similar policies for newly adopted dogs. While it is tempting simply to continue insuring with these providers, new owners should still take the time to research other policies before making a commitment.

As a general rule, premiums will reflect the cover levels. Insurance companies all have similar overhead costs and providers offering budget prices will be logically be making savings somewhere along the line. However the most expensive policies may not be the most appropriate either and owners should chose cover that best meets their needs while remaining affordable. The 'ultimate' pet insurance policy simply doesn’t exist - all have pros and cons so a degree of pragmatism is essential.

The more research that is done the better as this is the only way to make an informed choice and remember that one size most definitely does not fit all.

About the author...
Julia Carr
has worked in the insurance industry for over ten years and holds and FPC Level 1 qualification.

She has been competing in agility since 2014 and runs two shelties currently in Grades 5 and 6.

First published 2 October 2017