According to the latest data released by Pearson Ham Group, pet insurance prices have now started to drop, reducing by 2.5 percent during March 2024.
The decline comes in contrast to previous price increases, which had led to pet insurance premiums being 21 percent higher compared to the previous year by the end of February 2024. Additionally, it coincides with the Competition and Market Authority (CMA) announcement on 12 March regarding a formal market investigation into the vets market.
The CMA’s initial review highlighted several concerns, including potential weak competition in certain areas and concerns over possible diminished competition and consumer choice.
Prices of lifetime cover, the most sought-after form of pet insurance, dropped by 2.5 percent in March. Specifically, pricing for cats decreased by 1.8 percent, while pricing for dogs saw a more substantial decrease of 2.7 percent.
Regional disparities are also evident, with pet owners in the North-East experiencing the highest level of retained inflation in pet insurance pricing, standing at 29 percent compared to the previous year.
Conversely, the most significant price reductions were observed in London, with a decrease of 3.4 percent from the previous month. Nevertheless, pet insurance prices in London remain 16 percent higher than a year ago.
Taking a broader view of the UK market, despite the reductions in pet insurance premiums in March, prices remain approximately 20 percent higher than 12 months ago. Year-on-year inflation for dog insurance stands at 22 percent, double that of cat insurance at 11 percent.
Stephen Kennedy of Pearson Ham Group, said: “There are multiple factors influencing pet insurance pricing, including developments in diagnostic tools and treatments, which are escalating claims costs. Furthermore, there is a notable disparity in vet fees across the UK, reflected in insurance pricing, though this gap is narrowing as vet ownership consolidates. A likely impact of that, however, is that pet insurance premium inflation has increased across the board.
“The CMA’s announcement of a formal market investigation into the vet market alongside the reduction in pet insurance premiums in the same month is significant. While it’s challenging to determine the precise impact at this stage, it is likely that pet owners will benefit from these developments. By how much and by when still remains to be seen.”
