A guide to selecting the best pet insurance
(10-12 minute read) - written by Anthony @ LÈ PUP London
I have written this to try and provide useful info for pup owners (especially Iggy owners) to try and make the best decision for their pup. This may not be relevant for everyone, this is not advice, this is the research that I have done and my thought process behind it. Take from it what you want and feel free to correct me or add your own comments. This is my interpretation and it could be wrong. I spent on average 45 mins on the phone with each insurer, the information came at me thick and fast and whilst I did take notes, there may be some errors. Always do your own research and speak to the insurers to ask questions. Now let's get started.
Introduction
The purpose of this research was to try and find an insurance provider that will give my Italian Greyhound the best lifetime coverage and is as transparent as possible in costs. The idea was to have a long term perspective and go for the insurer who is going to give comprehensive cover for the lifetime of my pup whilst also not unexpectedly increasing the premium down the line to a level I can't afford.
Things I have taken into consideration are:
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Broken legs are common and can cost between £2000-£7000 depending on severity and any complications - (this is anecdotal and needs to be verified).
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The average value of claims for a pup over the course of their lifetime is £790 per year - (this figure was given to me by one of the insurers and needs to be verified).
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My puppy is female, male pup premiums may be slightly different.
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My puppy has been treated for a couple of minor issues (inflamed ear and dry skin), so I am looking at pre-existing terms and conditions closely too.
Answers I am looking for:
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How much are the likely vet costs are over the course of a pup’s life?
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What are the likely increases in monthly payments over the course of a pup’s life?
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What are the main factors for insurers in calculating renewal premium increases?
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How do the different fixed and variable excess options affect my insurance?
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What are the most important factors to consider are when selecting insurance?
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What to do if a pup has pre-existing injuries or conditions.
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How do the different insurers compare?
Assumptions made:
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We will make at least as many claims as the average pup, including at least 1 leg claim :( this is why I have opted for the highest level of cover across the board. It also makes it easier to compare companies/policies.
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We will have some bad luck, even though we wrap our pup in cotton wool.
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I can afford the highest level of cover but can’t afford unexpected increases.
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My pup will live to at least 10 years old.
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The 3rd party cover will not be used.
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I'm going to stay with the same insurer for the lifetime of my pet, I don't want to have to change down the line and then either pay huge premiums to have all pre-existing injuries covered or have too many exclusions/things not covered - rendering the policy largely redundant.
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I want all injuries and illnesses to be covered for the lifetime of my pup.
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Premiums which increase on the basis of number of claims or value of claims over the previous year are to be avoided.
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Providers unable to give me any indication at all of likely premium increases are to be avoided - I want my insurer and the associated premium costs to be as transparent as possible. It's no good to me signing up with an insurer without knowing what the likely insurance premium increases are going to be and having that aspect of it completely outside of my control. I equate that to signing a contract without reading it.
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Annual Vet cost increases will continue at a similar rate (apparently this year has been a big year for vet fee inflation - around a 10-20% increase) so I think basing it on this is safe enough to eliminate unexpected premium increases.
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I would rather pay more for my premium and have
a) my claims paid out without a fight.
b) no huge unexpected premium increases.
c) maximum transparency.
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My pup will be spayed and will not be used for breeding, will not be taken to work or living on a premises that sells alcohol.
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Lastly, and importantly, whilst I know that it's impossible to accurately predict insurance premium increases, I have attempted to do so based on this years prices and the 'expected' factors. My premium increase estimates, while imperfect, are at least a decent indication.
Which Insurers did I call?
Sainsburys, Petplan & Direct line - I have heard first-hand that they are reputable and good to deal with.
Agria, Waggle, Bought by many, Insurance Emporium, Purely Pets - I have seen these recommended on Facebook groups.
I started out by eliminating insurers and policies that didn’t give the transparency I wanted in terms of future premiums.
1) Sainsburys - Discredited, reason - They could not give any indication of future payments beyond the first year.
We discussed the Lifetime policy which means that injuries and conditions are covered for the lifetime of the pup and are not excluded the following year when it comes to renewing the policy.
The cover was £10,000 per year. Which means that you get a ‘pot’ of £10,000 to use for treatment per year with various limits and exclusions. With some insurers the pot is £10,000 per condition, with this insurer it was £10,000 in total. The exclusions are typically treatment related to behavioral issues.
The cost was £64 per month for the first year.
They could not give any indication of future payments beyond the first year. So I deemed this policy not transparent enough and therefore unsuitable.
The factors they consider when looking at renewal/premiums increases are: age, breed of pet, previous claims/claims history, and location (this helps them calculate the annual increase in vet fees).
2) Petplan - Discredited, reason - They could not give any indication of future payments beyond the first year.
We discussed their Ultimate lifetime policy.
The cover was £12,000 per year.
The cost was £87 per month for the first year.
They could not give any indication of future payments beyond the first year. So I deemed this policy not transparent enough and therefore unsuitable.
The factors they consider when looking at renewal/premiums & excess increases are: age (this was the main factor), vet fees & costs (which increase as the pup gets older), inflation in the market, advancement of treatment.
3) Direct Line - discredited, reason - they could not give any indication of future payments beyond the first year.
Vet fee excess £95 (fixed excess).
The cost was £37 per month for the first year.
They could not give any indication of future payments beyond the first year. So I deemed this policy not transparent enough and therefore unsuitable.
At this point I was starting to lose faith that I would ever find a transparent insurance provider but it did get better thankfully.
3) Insurance Emporium - discredited, reason - They could not give any indication of future payments beyond the first year.
We discussed a lifetime policy, and it was in a different format to the others. We discussed their 3 relevant policies.
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Bronze: The excess was £115 per condition + 5% variable excess per condition.
The fixed excess is paid once per condition per year (per 365 days from diagnosis/injury date), but the variable excess is paid on every claim. The cover was £2,500 for vet fees per condition per month. It includes standard vet fees, kennel fees in an emergency (up to a maximum of £750 total per year), death, loss/theft.
The monthly premium was £22 for the first year.
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Silver: The excess was £125 per condition + 5% variable excess per condition up to £20,000 and 15% variable excess thereafter.
The cover was £5,000 per condition per month. It includes standard vet fees, kennel fees in an emergency (up to a maximum of £1000 total per year), death, loss/theft.
The monthly premium was £26 for the first year.
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Gold: The excess was £135 per condition + 5% variable excess per condition up to £20,000 and 15% variable excess thereafter.
The fixed excess is paid The cover was £8,000 per condition per month. It includes standard vet fees, kennel fees in an emergency (up to a maximum of £1250 total per year), death, loss/theft.
Included in all of these policies was Dental treatment, excluding tooth cleaning, and on they only pay out on the basis that the vet is happy with the owners care of the pup's teeth. I.e. are you brushing your pup's teeth regularly enough or is there a case of negligence which has caused the dental issues.They will consult your vet about this.
The monthly premium was £31 for the first year.
Optional extras include European cover (vet fees while on holiday in Europe), Euthanasia and cremation, legal cover and a 24 hour lost and found service called the National Pet register.
Linked illnesses (linked to anything pre-existing) are not covered.
They couldn’t give an indication of future premiums but stated that the increase is more significant from 8 years old onwards. The factors they take into consideration are: age, location, vet fee inflation, market inflation, the claims/loss ratio for the company, no. of claims and how much has been paid out as a whole across the company for the specific breed.
4) Waggle - considered.
This company has only been established for 1 year so are a bit of an unknown entity.
They only quote online so I didn’t get as far as getting a quote but I asked them some of my key questions. I think this insurer said that all of their policies are lifetime policies, there were a number of insurers who said that. I like that because it means they’re not going to go excluding legs from the policy the following year if they break. I really want comprehensive cover and don’t want to worry about what is covered and what isn’t in years to come.
The cover was £10,000 per year.
They allow you to choose a different excess for different claim conditions.
They allow you to choose either an excess per claim or per condition.
They could not give any indication of future payments beyond the first year. So I deemed this policy not transparent enough and therefore unsuitable. However, they do have caps to prevent huge increases in renewal premiums. That was promising, but they couldn’t advise what the caps were.
The factors they consider when looking at renewal/premiums increases are: age (with significantly larger increases after 7-8 years old), location, vet fees & costs, breed, number of claims made by me, value of claims & type of treatment.
5) Bought by many - preferred.
Discussed the Lifetime complete policy -
I could choose a £99 fixed excess or £69 fixed excess, I asked to be quoted for both. Interestingly, the excess is only applicable for the first claim of the year (normally you have to pay the excess for each condition). So as soon as this is paid once in the policy year, it doesn’t need to be paid again for subsequent claims. This was something I liked as it means fewer unexpected charges.
The monthly premiums were £52 with a £99 excess and £54 with a £69 excess.
The cover was £15,000 per year and within that £15,000 pot they have limits for some types of treatment. You can claim a maximum of £2,500 on ‘complementary treatments’, which basically includes treatments like acupuncture, hydrotherapy (which crucially, we may need for leg break rehabilitation), herbal therapy. £2,500 for vet fees abroad, £150 for euthanasia, they give you the value of your pet back if your pup dies, £2,000 for kennel/boarding fees in an emergency. Dental treatment is covered in the pot - which is something not all insurers include. They also allow you to claim for the first 6 months of behavioral treatment out of the £15,000 pot - which is something many other insurers don’t include. Outside of the £15,000 pot, they include an additional £6000 for death or lost or stolen pup, which I think includes a reward fee and replacement of your child if they are lost or stolen. They don’t cover routine or preventative procedures & medication such as flea and worming or spaying (which is normal across all the policies I came across).
When it comes to pre-existing conditions, this policy seems to be the best as they will pay for treatment on a body part with a pre-existing condition/injury as long as it’s not a linked condition. So, for example, some insurers won’t pay for an ear trauma injury if my pup gets bitten in the ear - just because she has already suffered ear inflammation. This policy, however, would cover treatment that is not ‘linked’. They will also wipe the slate clean after 24 months if your pup isn’t diagnosed with a linked (or the same) condition again. So 24 months after the initial treatment, it stops becoming a pre-existing condition and they will start covering it for the pup . Which I think is great as my puppy has already had an inflamed ear which has been treated and puppy acne which has been treated. So it’s nice to know that if there are no recurrences, that linked conditions will be covered 2 years down the line.
I made a point of asking about leg breaks specifically as they are so common. In terms of conditions with respect to leg breaks - each leg is considered a separate condition. So if your pup has already broken a front left leg, they will at least cover the other 3 legs.
Bought by many also claim to pay out on 97% of claims.
Crucially, the premiums do not increase due to the number of claims you make. The factors they consider upon renewal are: Age, breed, location, market & vet fee inflation, whether the pup is spayed. This means that the premium increases are mostly ‘expected’, i.e. we know the age, spayed status, location & breed - those things won’t change, and the average vet cost increases we can assume remain constant. So in theory we can estimate the yearly increase. They also have transparency in terms of matching new quotes. What this means is that when my pup turns 2 years old, I will pay the same premium as a similar 2 year old pup who is just about to take out a new policy. We can use this to calculate an estimated increase in premiums but creating new quotes for different aged Italian greyhounds.
So I asked them to change my pup 's age from 8 months to 5, 9 & 10 years old ro give me an indication of how much the premium will be as she ages.
With a £99 excess (which is most comparable across the different policies as most are between £100-£150) the premiums were as follows:
At 8 months old £52 per month
At 5 years old £67.52 per month
At 9 years old £120 per month (+ an additional variable 20% excess every year from here onwards...we will talk about this ‘variable excess’ later)
At 10 years old £130 + a 20% variable excess
Also worth noting that claims can’t be made in the first 14 days of taking out this policy, which is pretty standard across most companies I found.
7) Agria - considered.
Again, pre-existing or linked illnesses are not covered - everything else that is not-linked is discussed with the vet.
We discussed a lifetime policy which included dental but excludes tooth cleaning, and on they only pay out on the basis that the vet is happy with the owners care of the pup's teeth.
They had 2 options for the fixed excess, either £105 or £170 per condition per year.
For the first 5 years of the pup's life they had 3 options for the variable excess, either 0%, 10% or 20%. After 5 years old the minimum is 10% and after 9 years old the 20% variable excess is compulsory.
The fixed excess would consider each leg as separate if the pup was unlucky enough to break 2 different legs in one year. However, if another leg is injured as a result of the first leg break e.g. if there is a lot of strain on another leg due to keeping weight off of the broken leg - then it is considered the same incident and there is no need to pay another excess fee.
They had 2 options, £6,500 cover or £12,500 cover per year for vet bills.
Optional extras that you can only add at the very start of the policy were:
Cover up to 9 years old for death from illness and any age for accidental death, lost pup or theft. The pup is covered for whatever you paid for the pup up to £2,500.
Also Holiday cancellation cover if you need to cancel a holiday because of the pup (not sure of the exact conditions of this).
Optional extras you can add any time are: Pet insurance while abroad - all areas under the ‘pet travel scheme’.
They also had an introductory offer which was first month free. In all honesty, when you have a long term view and you’re set to spend many thousands of pounds - I decided that really should not be a deciding factor.
8) Purely pets - discredited, reason - they could not give any indication of future payments beyond the first year.
They will cover pre-existing injuries as long as they’re not linked, so they don’t rule out entire body parts on the basis that they have been damaged before, it would have to be linked for them to not pay out.
We discussed the lifetime cover and you can choose between £10,000-£15,000 as a total pot. There is not much difference between the two…
The £10,000 cover costs £36 per month for the first year and the £15,000 cover costs £37 per month. Both excesses are £100 fixed and after 5 years old a 20% variable excess comes in. They both cover dentistry and ‘complementary’ treatment but you have a £750 limit for each for the entire life of the pup on the £10,000 cover and a £1000 limit for the £15,000 cover. They both cover CT & MRI scans up to £1500 per year and £2000 for cruciate ligament damage (which can occur with a leg break).
They could not give any indication as to future premium increases. The factors for premium increases are: the number of claims. Age, breed, location, gender, market & vet fee inflation. They also said that several small claims would probably increase the premium more than one big claim - I appreciated their transparency there.
The Numbers
Here are the numbers I’ve been working with. It’s not an exact science but I wanted at least an indication, and also assuming one or two extra leg breaks in there. I was told that the average is £790 in claims per year for pup owners = £11,060 over the course of 14 years. If we add to that one severe leg break with complications or 2 standard leg breaks we are looking at approximately £7000 extra. So that’s £18,060 over 14 years or £1290 per year. We can safely say that most of the time, the claims will be heavily weighted towards the tail end of the pup's life. That means that the claims are likely to be less than £1290 per year for the first few years and more than £1290 after 8 years old. It is the later years when the variable excesses kick in - but you never know when your pup might break their leg - it could be any time...That said, in the interest of not overcomplicating things we can just assume the average throughout.
I used two insurers to run my numbers, Agria & Bought By Many. This is because they were the only insurers I found that were transparent enough to allow me to estimate future premiums.
Lets start with Agria, who have quite a complex policy matrix, which will allow us to explore the different variable excess rates and how it affects premiums.
The £12,000 lifetime policy for year 1:
A £105 fixed excess and 0% variable excess - the premium is £106 per month or £1272 total for the year.
A £105 excess and 10% variable excess - the premium is £79 per month or £948 total for the year.
A £105 excess and 20% variable excess - the premium is £60 per month or £720 total for the year.
Lets assume that we claim the average of £790 in the first year.
We always pay the first £105 as the fixed excess, so that’s £1272 in premium + £105 assuming we make at least one claim in the year. That means we pay a whopping £1377 with the 0% variable excess for the first year.
If we select the 10% excess, we have to pay £948 in premiums, the £105 fixed excess and 10% of £685 (£790 - the fixed excess) which is £68.50. That means we pay £1121.50 with the 10% variable excess for the first year.
If we select the 20% excess, we have to pay £720 in premiums, the £105 fixed excess and 20% of £685 (which is £137). That means we pay £962 with the 20% variable excess for the first year.
If we go for the £170 excess, this is how it changes:
A £170 fixed excess and 0% variable excess - the premium is £85 per month or £1020 total for the year.
A £170 excess and 10% variable excess - the premium is £63 per month or £756 total for the year.
A £170 excess and 20% variable excess - the premium is £48 per month or £576 total for the year.
Lets assume that we claim the average of £790 in the first year.
We always pay the first £170 as the fixed excess, so that’s £1020 in premium + £105 assuming we make at least one claim in the year. That means we pay a whopping £1190 with the 0% variable excess for the first year.
If we select the 10% excess, we have to pay £756 in premiums, the £170 fixed excess and 10% of £685 (£790 - the fixed excess) which is £68.50. That means we pay £994.50 with the 10% variable excess for the first year.
If we select the 20% excess, we have to pay £576 in premiums, the £170 fixed excess and 20% of £685 (which is £137). That means we pay £883 with the 20% variable excess for the first year.
So far we are better off taking the higher fixed excess and the higher variable excess over the course of the year based on our assumptions. But what if we get unlucky? What if our pup breaks a leg costing £7000? In the above policy, we would pay:
With £105 and 0% excess - we still pay £1377
With £105 and 20% excess - we pay £2204
With £170 and 0% excess - we still pay £1020
With £170 and 20% excess - we pay £2112
So with just one expensive leg break claim we are better off taking the higher fixed excess and lower variable excess.
BUT - With Agria, the excesses are per condition per year, so if we get unlucky and have to claim multiple times then those figures will rise, and we will probably be better off taking the lower fixed excess and lower variable excess.
Bear in mind you can’t lower the excess once you’ve started the policy.
Now comes the interesting part!
We can estimate what the 5th year costs will be on the basis of re-quoting for a 5 year old, and once our pup reaches 5 we are more likely to claim more frequently, so I have gone with the lower £105 excess for these quotes.
At 5 years old the 10% variable excess is compulsory. The premium is £109 per month or £1308 total for the year.
At 10 years old the 20% variable rate becomes compulsory. The premium is £182 per month or £2184 per year.
Believe it or not, the variable excess is actually a good thing in my opinion, let me explain why. Insurers are out to make money, and they know that they are more likely to pay out as the pup gets older. So they have 4 options, option 1) Increase the premium to a ridiculously high level once the pup reaches 8 years old. Option 2) Increase the premium the following year after making a large payout to recoup the money they just paid out. Option 3) start putting strict stipulations and exclusions on what they will pay out for in the future Option 4) put a variable excess in so if they have to pay out then their cost is reduced slightly. With option 4, at least you continue to get comprehensive coverage across all the same conditions irrespective of how much you claim the previous years. In addition, you don’t have to worry about the premiums going up drastically and unexpectedly.
However, although this policy was transparent and comprehensive, it still looks like it’s quite an expensive policy. Over the course of 10 years, on average with 1 claim per year, we are looking at around £5100 for years 1-5. £1308 for year 5 and assuming incremental increases up to £182 at year 10, were looking at around £8856 for years 6-10. A total of £13956 over the course of your pup's life. And that will only increase by at least £2000 for every extra year that the pup is alive past 11 years old.
So lets add this all up over the course of the pup 's life assuming they live to 10 years old.
The average payout is £790 per year, so on average we will pay £7900 in vet fees over the course of the pup's 10 year life if we don't get unlucky with leg breaks.
If my pup lives to 10 years old with the Bought By Many policy below, we will pay £9534 + 20% variable excess after 9 years old. We are likely to pay more than £790 over the course of those 2 years as the pup is more likely to have health issues later on in life but we will assume £790 for simplicity. That’s an additional £158 in excess fees per year or £316 total.
With Bought by Many we pay:
Year 1: £624
Year 2: £672
Year 3: £720
Year 4: £768
Year 5: £810
Year 6: £936
Year 7: £1062
Year 8: £1188
Year 9: £1314 (+ an additional variable 20% excess every year from here onwards)
Year 10: £1440
So in total that is £9850 for the 10 years of medical cover.
At 8 months old £52 per month
At 5 years old £67.52 per month
At 9 years old £120 per month (+ an additional variable 20% excess every year from here onwards...we will talk about this ‘variable excess’ later)
At 10 years old £130 + a 20% variable excess
Other useful findings - going through the small print wasn’t always clear and didn’t answer all my questions. But by calling them up and speaking on the phone, it was easier to understand the policy and discuss real scenarios.
Video conferencing is useful and will save you worry, hassle, and money in the long run. Thats included in the following policies - BBM, Agria, Waggle, PawSquad - Direct line.
Conclusion
After running the numbers, I am not prepared to take any risks, I could get lucky and not suffer a leg break - in which case I’ll probably be overpaying on insurance. I could get unlucky and have multiple leg breaks, in which case the insurance will be well worth it. But based on what’s important to me - transparency & comprehensive cover, I have decided to buy the Bought by Many policy.
Thanks for reading and I hope this was helpful.
Anthony (Co-founder @ LÈ PUP - Bespoke dog clothing and accessories)
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