Pet Insurance - Penalised for being an existing customer

LesDee

I've currently got Pet Insurance with Tesco and I've been with them since 2016. 
My cat is now 9years and 9months old and my dog is 4years and 2months old. 

I had my renewal quote in and it was £292 more expensive this year. I called them and they applied a 15% discount for each pet. This took it to a difference of £168 more expensive than last year. 

I went online and got quotes to be new customer and the quote is coming in at over £200 cheaper (than the discounted renewal quote). 

I've raised a complaint with Tesco - obviously; but I can foresee their response and they won't reduce the price. Then I'd have to wait 8 weeks before I can take it to the Financial Ombudsman, meaning that I'll be out with the 14days to back out of the renewal. 

I also registered my clubcard with them to get a clubcard discount and points, but today I was told that they don't give you points on Pet Insurance unless you gave a promotional code at the time of registering the clubcard. I remember registering the clubcard and this was not the advice at the time. I've obviously raised a complaint on this one separately and can foresee their outcome too. Do I get them to go through 8years of recorded calls to find the advice I was given?! 

Why are existing long term customer penalised so much? 

DullGreyGuy

Do your pets have any pre-existing conditions/ever been treated for anything? Have you made any claims?

Historically it's been common practice to attract customers by heavy discounting, often selling at a loss, and that is funded by charging renewing customers more. The longer a customer stays the less likely they are to leave/less price sensitive they become. This practice has recently been stopped for private Motor and Home but is still allowed for other classes of consumer insurance.

Obviously if you've had a claim, say for a fractured leg, then the renewal quote and new business quote would be fundamentally different... the renewal most likely would continue to cover issues with that limb whereas the new business policy would exclude any future issues (eg arthritis) as a pre-existing condition. This can sometimes explain the pricing difference but is also how lock in is created. 

sheramber

It happens with pet insurance

With a new policy ant pre existing conditions , and anything that can be related them, will be excluded

There is an initial exclusion period with a new policy so you need to hope your pet does not develop anything during that time.

If you have no pre exising conditions then you only need to be aware of the exclusion period.

Make sure you are comparing the same level of cover as before.

400ixl

Your current renewal will include any existing conditions, the new policy will likely exclude pre-existing conditions. Or are you saying you disclosed those pre-existing conditions and they accepted them to be covered in the new quote? If the latter, then just don't renew and take the new policy instead.

If there are no pre-existing conditions to consider, then again cancel the renewal and take the new policy.

If there are pre-existing conditions and they are not included in the new policy, then you have to decide if you want to take the risk of them being excluded. That would be why you are paying the additional amount.

Slinky

I always recommend going with Petplan. Our monthly premiums went from approx £38 to £43 this year, with a claim of over £9,500 paid out, and the condition (lung cancer) continues to be covered.

Lavendyr

Slinky said:

I always recommend going with Petplan. Our monthly premiums went from approx £38 to £43 this year, with a claim of over £9,500 paid out, and the condition (lung cancer) continues to be covered.

Second this. One of my cats was at full claim of £7k in 2022. His premium went up by around £2 a month the following year. I've now claimed around £5.5k in 2023 - it is a covered for life policy so it isn't cheap from the off but it has been totally worth it. His care over the last 2 years has amounted to around £22k. Insurance has accounted for around £12k - then I sold my car to cover the rest. He is part of the family,aged just 8 now. 

50_Hertz

I’m looking for some clarity on whether the FCA rule about insurers having to offer existing customers the same price as new customers applies to pet insurance, or whether it’s limited to home and motor.

Context:

I have a 5-year-old Border Collie insured on a lifetime pet insurance policy with Co-op. I took the policy out last year. I’ve made no claims at all during the year.

During the policy term, my dog was diagnosed with a mild eye condition. I’ve paid for this myself and haven’t claimed or involved the insurer, as it’s been minor and I don’t expect it to become serious — though, of course, you can never be 100% certain.

At renewal, Co-op have increased my premium by over £200, despite there being no claims. Out of curiosity, I went online and got a quote from Co-op as a new customer for what appears to be exactly the same lifetime cover, and the price quoted is around £230 cheaper than my renewal.

That feels like it breaches the rule about not charging existing customers more than new customers for equivalent cover — unless that rule doesn’t apply to pet insurance.

My dilemma is this:
I could cancel and take out the cheaper “new customer” policy, but that would mean the eye condition (which was diagnosed before the new policy start date) could be treated as pre-existing and excluded. If I renew, I keep continuous cover and that risk disappears — but at a much higher price.

I’ve seen conflicting posts saying that the “same price for new and existing customers” rule only applies to home and motor insurance, while others suggest it applies more broadly.

Does anyone know the definitive position on whether this FCA pricing rule applies to pet insurance?

sheramber

yes, it does not apply to pet insurance.

It is quite normal for for first year applications to get a discounted price , which hikes up the second year because you no longer get the discount and there has been a general increase in premiums due to cost of living costs etc