UK Pet Insurance: Market Dynamics and Opportunities 2019

UK Pet Insurance: Market Dynamics and Opportunities 2019

Summary

This report analyzes the UK pet insurance market, looking at market size as well as changes in premiums, claims, medical costs, and pet ownership. It discusses competitors in the market, explores how the market is likely to change due to rising costs and emerging technology, identifies opportunities in the pet insurance space, and provides future forecasts of market size up to 2023.

The UK pet insurance market experienced a flat year in 2018, with total market gross written premiums (GWP) of £1,193m - an increase of just 0.3% compared to 2017. The number of pet insurance policyholders shrunk in 2018, and the average pet insurance premium dropped for the first time in eight years.

The pet insurance market is dominated by a few key players that are likely to maintain their position in the coming years. The main concern for insurers will be rising claims costs, with both gross claims cost and average claims cost steadily increasing over the past five years. And this trend is expected to continue going forward. Increasing rates of obesity among pets is a key concern, and insurers need to encourage owners to provide a healthy lifestyle for their pets in order to tackle the rising costs they face.

Scope

  • Dog insurance represents the largest proportion of the total pet insurance market, accounting for 75% of GWP. Cat insurance only accounts for 18% of GWP even though the UK’s dog and cat populations are comparable.
  • The average cost of a dog and cat claim are £798 and £632 respectively. Claims costs for other pets are notably higher.
  • Petplan was the largest pet insurer in the UK in 2018 with a 35.5% share of GWP.
Reasons to buy
  • Keep up to date with the new trends and innovations in the pet insurance market.
  • Benchmark yourself against competitors.
  • Learn about growth in all aspects of the market, what is driving it, and whether it is set to continue.


  • Executive Summary
    • Pet insurance growth faltered in 2018 but is expected to pick back up
    • Key findings
    • Critical success factors
  • Pet Insurance Market Dynamics
    • The UK pet insurance market stagnated in 2018
      • Table Figure 1: GWP growth in the UK pet insurance market was almost non-existent in 2018
      • Table UK pet insurance market GWP, 2013–18
      • The number of pet insurance policyholders fell in 2018
        • Table Figure 2: The number of policyholders in the pet insurance market fell in 2018
        • Table Figure 3: The majority of pet insurance policyholders have dog insurance
      • GWP is dominated by dog insurance
        • Table Figure 4: Dog insurance dominates the market
      • Average premiums vary by type of pet
        • Table Figure 5: Average premiums for dogs and cats have been on an upward trend since 2013
    • The gross cost of claims continues on an upward trend despite a fall in frequency
      • The number of claims notified fell for the first time in five years
        • Table Figure 6: There were fewer pet claims in 2018 than in 2017
      • Gross claims in the pet insurance market saw minimal growth
        • Table Figure 7: The cost of claims has increased by £262m since 2013
        • Table The claims landscape in the pet insurance market, 2013–18
      • Technology is a double-edged sword
      • Veterinary salaries have had little impact on the cost of claims, but this will change
      • The average claim varies considerably depending on the type of pet
        • Table Figure 8: Average claim cost is lowest for cats
        • Table Average claims cost by pet, 2013–18
    • Summary of the current market by product
      • Table Breakdown of the pet insurance market by product, 2018
    • The proportion of UK households with pets has decreased
      • The number of dogs remained the same, but the number of cats decreased
      • The size of the potential pet insurance market is almost four times its current value
        • Table Figure 9: There is considerable potential for growth throughout the pet market
      • Obesity within the UK pet population is an increasing problem
        • Table Figure 10: Owners are open to using technology to monitor their pets
  • Competitor Dynamics
    • The structure of the UK pet insurance market
      • Allianz, RSA, and Red Sands are the largest underwriters in the market
        • Table Figure 11: Allianz underwrites more than twice as much in premiums as any other competitor
        • Table Figure 12: Allianz also underwrites the greatest number of contracts
      • The top three providers have very similar offerings
        • Table Petplan's pet insurance products
        • Table Animal Friends' pet insurance products
        • Table Tesco Bank's pet insurance products
      • Bought By Many is bringing innovation to the market
      • Waggel takes pet insurance fully digital
    • The leading players have the greatest marketing expenditure
      • Table Figure 13: More Than spends over twice as much as its nearest rival on marketing
  • The Market Going Forward
    • The market is set to continue growing
      • Total market GWP is forecast to reach £1.7bn in 2022
        • Table Figure 14: The market will exceed £1.5bn in GWP in 2023
        • Table The split of the pet insurance market, 2018–23f
      • Policy numbers will continue rising
        • Table Figure 15: There will be over 4 million pet policyholders by 2022
        • Table Forecasted number of pet insurance policyholders by pet type, 2018–23f
    • The cost of claims will continue to increase
      • Table Figure 16: The total cost of claims will continue rising
      • Table The cost and number of claims within the total pet insurance market, 2018–23f
      • Dog insurance claims are forecast to increase through to 2023
        • Table Figure 17: Dog insurance claims will cost the industry over £750m in 2023
        • Table The cost and number of claims within the dog insurance market, 2018–23f
      • The average cost of a cat insurance claim is expected to rise
        • Table Figure 18: The average cat claim will cost insurers £731 in 2023
        • Table The cost and number of claims within the cat insurance market, 2018–23f
      • The number of claims is expected to fall in the other pet segment
        • Table Figure 19: The average cost of other pet claims will rise despite a decreasing number of claims
        • Table The cost and number of claims within the other pet insurance market, 2018–23f
    • Reducing costs will be key for pet insurers
      • Pet insurers should replicate innovation seen in the private medical insurance market
      • Blockchain can reduce costs and improve the customer experience
    • Different avenues could be utilized to increase product uptake
      • Pet insurance in the US is becoming an increasingly popular employee benefit
      • Social media could allow insurers to target digital-savvy individuals and educate pet owners
  • Appendix
    • Abbreviations and acronyms
    • Methodology
      • Competitor rankings
      • 2018 UK Insurance Consumer Survey
      • Forecasting methodology
        • Table Figure 20: Forecasting methodology
    • Secondary sources
    • Further reading
    • About GlobalData
      • Table Figure 21:About GlobalData

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