Recent data from Pearson Ham Group reveals a notable decline in pet insurance prices, with premiums dropping by -2.5% in March 2024.
This reduction comes as a contrast to previous increases, which had seen pet insurance premiums soar by 21% compared to the previous year by the end of February 2024. The decrease coincides with the Competition and Market Authority’s (CMA) announcement of a formal market investigation into the veterinary market on 12th March.
Initial Concerns Spark Investigation
The CMA’s initial review identified several concerns within the veterinary sector, including potential weak competition in specific areas and worries regarding diminished competition and consumer choice. The investigation aims to address these concerns and ensure a fair and competitive market landscape.
The decline in pet insurance prices varies across regions, with the North-East experiencing the highest level of retained inflation in pet insurance pricing, standing at 29% compared to the previous year. In contrast, London witnessed the most significant price reductions, with a decrease of -3.4% from the previous month. However, pet insurance prices in London remain 16% higher than a year ago.
Stephen Kennedy of Pearson Ham Group highlights various factors influencing pet insurance pricing, including advancements in diagnostic tools and treatments, which escalate claims costs.
He adds, “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.”
