Pet Insurance - What do you think of life cover?

steveyme

Hi all! About to renew my pet's insurance cover. Is life cover worth it, where where I could potentially get repeating payouts up to a fixed amount year on year? The cynic in me is thinking that if I did need to use this, over time, the insurer could just force me off the policy with massively higher yearly premiums? Any thoughts? Thanks!!

Sandtree

Ultimately they could do, if you look at the likes of Pet Plan they state claims experience doesn't impact their pricing.

What can also create lock in is your pet getting older... some providers stop offering new business policies to pets say over 9 years old but they will allow existing customers to renew

Birseh_

You would be correct steveyme....if its a new/young dog why don't you self insure....put aside each month and then you don't have the claim arguments and profit margin of the insurer

MovingForwards

Never insured any of mine, always paid cash as and when needed. 

Petplan are the one insurer you can rely on for having genuine cover for life, all the rest you can't.

Petplan are expensive, but you pay for what you get. The others are cheaper, but can hike the prices when it's renewal time, or don't offer cover when an animal hits a certain age.

What is your pet and if cat / dog is it a breed or moggy / mongrel?

Aretnap

Birseh_ said:

You would be correct steveyme....if its a new/young dog why don't you self insure....put aside each month and then you don't have the claim arguments and profit margin of the insurer

"Self-insuring" involves a bit of self-deception. Putting aside a fiver a month or whatever it costs to insure a young pet is all very well if they get a cut which needs a couple of stitches, but won't be much use if they get a long term condition which requires hundreds or thousands of pounds a year in treatment. The nature of insurance is that a minority of people get unlucky and have to make very large claims, and they are subsidised by the lucky people who don't. So if you're going to "self-insure" you have to think about what you would do if your pet got a condition which was going to result in large and ongoing vets bills.

For some people the answer will be "I can afford a few thousand quid; my children would just inherit a bit less".

For some people the answer will be "I wouldn't like it, but I could find a few grand if I had to. I might just have to not take any holidays for a few years".

And for some people the answer will be "I've looked myself in the eye, and if the vets bills got above a certain point I could cope with having the pet put down".

All of which are fine. However if none of them apply to you, going without pet insurance is a risk.

Sandtree

Insurance is straight forward.... you pay a small amount for a policy in exchange for not having the risk of paying out a big amount. Obviously insurance companies are in it to make money, have advertising costs etc and so if you look at the loss ratio (claims costs -v- premium - ie not including cost of sales) then most insurers are making a profit. Even on a combined ratio (all costs -v- premium) you'd hope in most years the value is under 100% and so profitable (due to the short term nature of general insurance investment returns are tiny compared to life insurers).

This however is the law of averages, if you want to "self insure" then the amount you need to put aside is significantly higher than what an insurance company says your monthly premiums will be. In the same way insurers have to hold capital above what their "best estimate of liabilities". 

Certainly a lot of people don't/self insure and end up in the money by a modest amount, there are a smaller number of people who choose to do so and end up with exceptionally large bills and out of the money.

Ultimately, outside of compulsory insurance like Car, you weight up the prices and risks and make your decisions.

steveyme

Thanks for replies, all!
For background, I have a 7 year old cat. I would regard myself as a bit of an insurance 'cynic'. I quite often self-insure in fact. For my cat though, I thought I would play it down the middle, and get the cheapest insurance possible at £9 per month, with the policy offering £1500 cover. What happened last weekend led me to believe this was quite a major error of judgement: The cat rolled in with a heavily bleeding mouth Saturday midnight. I had no choice but to take him to Vet's Now, incurring costs of £720. At 3am I was woken by a call to say his breathing was becoming laboured and that they wanted to authorise a referral to a specialist vets. When there, he went into ICU, and was looking so bad I opted for a CT scan. This revealed he had bruised lungs and a fractured jaw. He came out on Wednesday and I have a total bill of a few pounds under £5k. No amount of self insuring would have paid for this, and trust me, when it's 3am, your partner is crying and you have a split second decision on the phone as to whether you are going to see your pet again, you authorise the work. If I'd had paid £12 instead of £9 a month, I would have been covered for the full amount.

Sandtree

People unfortunately mix up no insurance with self insurance. If you do the later you put aside much more than the monthly premiums from day one to cover these rare but expensive events (just as an insurance company has to). On average most people will work out quids in for doing so but for each person making a small benefit there will be a small number making a massive loss. 

It however sounds as if you have had a massive change of heart from your original post saying insurance is a con to now saying you wish you'd bought more cover!

elsien

I always have life cover, with a higher amount insured. There are variations depending on who you insure with - I am with Petplan because I found with my last dog who had a lot of illnesses and needed ongoing treatment from a young age that I claimed more than I paid and the premiums didn't go up a stupid amount until she got older, which is par for the course for older dogs anyway.
The current incumbent has had few claims, but I still have full life cover. Two nights in the out of hours hospital just for tests with no treatment cost me the best part of a grand and it is something which could potentially have an awful lot of exclusions attached if it was reviewed each year.
It's like any insurance - you weigh up the pros and cons for your individual circumstances. I've never claimed on my house insurance but I wouldn't be without it.