2021
9
UK Pet Insurance Market Report 2021
2021-09-28T04:03:54+01:00
OX1049541
2195
142733
[{"name":"Insurance","url":"https:\/\/store.mintel.com\/industries\/finance\/financial-services\/insurance"}]
Report
en_GB
“The COVID-19 pandemic led to an increase in pet ownership and boosted the value of the pet insurance market. While the length of the crisis is still to be determined,…

UK Pet Insurance Market Report 2021

£ 2,195 (Excl.Tax)

Description

The UK Pet Insurance market report identifies consumer attitudes towards pet insurance, competitive strategies, purchase barriers, and pet insurance industry analysis in the UK. This market report covers the market size, market forecast, market segmentation and industry trends for the Pet Insurance market in the UK. 

Current Market Landscape

Less than half of pet owners have pet insurance. However, penetration of pet insurance is higher among those with pets that have been acquired during the COVID-19 pandemic. The UK pet insurance market saw a boost in premiums in 2020, with successive national lockdowns leading to an increase in pet ownership.

  • 55% of those who have become pet owners since March 2020 have pet insurance, with a similar percentage (54%) among those who have acquired an additional pet during this period.
  • According to data from the ABI, in 2020 subscriber numbers increased by just 1%, despite the growth in pet ownership.
  • At 41%, cat insurance penetration remains much lower compared to dog insurance (54%).

The potential for the expansion of insurance remains high as around half of pets are still uninsured. While the length of the crisis is still to be determined, lifestyle changes such as more homeworking are expected to persist in the long term, providing a platform for higher levels of pet ownership in the future.

Future Market Trends in Pet Insurance 

One of the main challenges for the pet insurance market currently is finding ways to increase their customer base, ensuring pet insurance remains attractive to pet owners. Consumers continue to be price-sensitive, seeking out the best value options and weighing up the benefits of self-funded pet healthcare. Insurers will have to find the right balance between profit margins and premiums so they don’t limit uptake among potential customers or price out existing ones.

Although there is only a 3-percentage point difference between ownership of dogs and cats, cat insurance penetration remains much lower compared to dog insurance. This suggests more needs to be done to ensure cat owners can see the value and benefit of cover, with opportunities to develop more cat-specific features to increase penetration and relevance for cat owners.

Read on to discover more details or take a look at all of our UK Pets market research.

Quickly understand

  • The impact of COVID-19 on the pet insurance market.
  • Market performance and a five-year market forecast.
  • An analysis of competitive strategies and launch activity.
  • Pet insurance ownership by level of cover held.
  • Purchase barriers.
  • Attitudes towards pet insurance.
  • UK pet insurance market.
  • Pet insurance industry analysis.

Covered in this report

Brands: Petplan, Allianz, RSA, Red Sands, Direct Line, Metro Bank, Staysure Group, Reach Financial Services, Bought By Many, Waggel, Agria Pet Insurance, Itch, Animal Friends, Pet Protect, Bought By Many, Pet Guard, Clicksco Digital, Everypaw, Sainsbury’s Bank.

Expert analysis from a specialist in the field

This report, written by Stefania Apostol, a leading analyst in the Financial sector, delivers in-depth commentary and analysis to highlight current trends and add expert context to the numbers.

The COVID-19 pandemic led to an increase in pet ownership and boosted the value of the pet insurance market. While the length of the crisis is still to be determined, lifestyle changes such as more homeworking are expected to persist in the long term, providing a platform for higher levels of pet ownership in the future. Indeed, the potential for expansion remains high as around half of pets are still uninsured. However, insurers will have to strike the right balance between profit margins and the cost of premiums so they don’t limit uptake among potential customers or price out existing ones.

Stefania Apostol - Financial Services AnalystStefania Apostol
Financial Services Analyst

Table of Contents

  1. Overview

    • Key issues covered in this Report
    • COVID-19: market context
    • Economic and other assumptions
    • Products covered in this Report
  2. Executive Summary

    • Impact of COVID-19 on pet insurance
      • Figure 1: Short-, medium- and long-term impact of COVID-19 on pet insurance, 2020-25
    • The market
    • Pet insurance market increased in 2020
      • Figure 2: Size of the pet insurance market, by subscribers and gross written premiums, 2016-20
    • Pet insurance market is expected to grow over the next five years
      • Figure 3: Market size and COVID-19 scenario forecasts for pet insurance, 2016-26
    • GWP for dog policies grew by 7%
      • Figure 4: Pet insurance gross written premiums, by type of pet, 2016-20
    • Dog insurance premiums increase by 8%
    • Companies and brands
    • Top four providers of pet insurance maintain their positions
    • Growth in pet ownership drives new entrants to pet insurance sector…
    • …while acquisition activity intensifies
    • Providers support proactive pet care
    • The consumer
    • Pet ownership has increased during COVID-19
      • Figure 5: Pet ownership, 2020 and 2021
    • Around half of pet owners have pet insurance
      • Figure 6: Pet-related products and services paid for within the last 12 months, 2021
    • Majority of policyholders opt for mid-level and lifetime covers
    • Lower-priced policies are less popular
      • Figure 7: Level of cover held, 2021
    • Intentions to take out or renew pet insurance are high
      • Figure 8: Likelihood of taking out or renewing a pet insurance policy, 2021
    • Cost is the main barrier to purchase
      • Figure 9: Pet insurance barriers, 2021
    • Incentivise existing and potential customers by offering discounts and useful features
      • Figure 10: Potential incentives to switch pet insurance policies, 2021
    • Majority would be willing to pay more for pre-existing conditions
      • Figure 11: Attitudes towards pet insurance, 2021
  3. Issues and Insights

    • COVID-19 has boosted the pet insurance market
    • Adopt a proactive approach to improving pet health
  4. The Market – Key Takeaways

    • GWP increases in 2020 as dog insurance premiums jump by 8%…
    • …but penetration of insurance among pet owners remains relatively flat
    • Household expenditure on veterinary services reaches a new high
    • Claims notified drop while the average claim value rises
  5. Market Size and Performance

      • Figure 12: Short-, medium- and long-term impact of COVID-19 on pet insurance, 2020-25
    • GWP increased by 6% in 2020…
      • Figure 13: Value of pet insurance gross written premiums, 2016-21*
    • …but the number of subscribers only grew by 1%
      • Figure 14: Size of the pet insurance market, by exposure, subscribers and gross written premiums, 2016-20
  6. Market Forecast

    • Pet insurance forecast to grow
      • Figure 15: Market forecast for UK pet insurance, 2021-26
    • Market drivers and assumption
      • Figure 16: Key drivers affecting Mintel’s market forecast, 2015-25
    • Forecast methodology
  7. COVID-19 Scenario Performance

    • Mintel’s approach to predicting the impact of COVID-19
    • Fundamental differences in how COVID-19 is affecting consumer markets
    • COVID-19 scenario forecast for pet insurance
    • An extended period of disruption will benefit the pet insurance market
    • The market will see slower growth in a rapid recovery scenario
      • Figure 17: COVID-19 scenario forecasts for pet insurance, 2016-26
    • COVID-19 market disruption: risks and outcomes
      • Figure 18: Summary of Mintel scenario expectations and the impact on the pet insurance market, 2021
  8. Market Segmentation

    • Number of subscribers increases by 1%
      • Figure 19: Number of pet insurance policy subscribers, by type of pet, 2016-20
    • GWP for dog policies grew by 7% in 2020
      • Figure 20: Pet insurance gross written premiums, by type of pet, 2016-20
    • Dog insurance premiums increase by 8%
      • Figure 21: Average pet insurance premium* (based on subscribers), by type of pet, 2015-20
  9. Market Drivers

    • Pet ownership has increased during the pandemic
    • Household expenditure on pets continues to grow
      • Figure 22: Average UK weekly household expenditure on pets, by component, 2015/16-2019/20
    • Average claim value continues to increase
      • Figure 23: Number of claims notified and average claim value, 2014-20
    • Claims incurred fell by 1% in 2020
      • Figure 24: Gross claims incurred and claim ratio, 2014-20
    • Pet insurance complaints increase by 34% in 2020/21
      • Figure 25: Number of pet insurance complaint enquiries, new cases and percentage of cases upheld, 2015/16-2020/21
  10. Regulatory and Legislative Changes

    • FCA published its final rules on general insurance
    • Government introduced Action Plan for Animal Welfare
  11. Companies and Brands – Key Takeaways

    • Top four providers of pet insurance maintained their positions in 2020
    • Growth in pet ownership drives new entrants to pet insurance sector…
    • …while acquisition activity intensifies
    • Providers support proactive pet care
    • Insurers are using digital marketing to engage pet owners
  12. Market Share

    • Allianz remains the market leader
    • RSA, Red Sands and Direct Line maintain their positions
    • Pinnacle Insurance gains market share
      • Figure 26: Estimated market share of pet insurance, by GWP, 2020
  13. Competitive Strategies and Launch Activity

    • Growth in pet ownership drives new entrants to pet insurance sector
    • RSA acquired by Tryg and Intact Financial Corporation
    • Simplyhealth sells pet health plan business
    • Bought By Many enters the US market
    • Providers support proactive pet care
    • Itch aims to reward proactive pet care through its new pet insurance policy
    • Pet Protect partners with PitPat to offer activity monitors
    • Animal Friends launches PupStart
  14. Advertising and Marketing Activity

    • Advertising expenditure falls
      • Figure 27: Total above-the-line, online display and direct mail advertising expenditure on pet insurance products, 2016/17-2020/21
    • Bought By Many substantially increases adspend to top list of advertisers
    • GoCompare promotes pet insurance and launches multi-pet comparison service
    • Waggel launches its first TV advert
    • Everypaw introduces the Daredevil Doggy
      • Figure 28: Top 10 above-the-line, online display and direct mail advertisers of pet insurance products, 2019/20 and 2020/21
    • TV dominates advertising expenditure
      • Figure 29: Total above-the-line, online display and direct mail advertising expenditure on pet insurance products, by media type, 2020/21
    • Search marketing and social media continue to gain traction
    • Nielsen Ad Intel coverage
  15. The Consumer – Key Takeaways

    • Pet ownership has increased during COVID-19
    • Around half of pet owners have pet insurance…
    • …and intentions to take out or renew pet insurance are high
    • Cost is the main barrier to purchase
    • Incentivise existing and potential customers by offering discounts and useful features
  16. Impact of COVID-19 on Consumer Behaviour

    • Pet ownership has increased during COVID-19
    • Families with children more likely to have acquired lockdown pets…
    • …along with Millennials and those in urban areas
      • Figure 30: New pets acquired during lockdowns/pandemic, 2021
    • Changes to working patterns will impact pet owners
      • Figure 31: Remote working, 2021
    • Household finances have generally held up well despite the pandemic
      • Figure 32: Financial situation, 2021
  17. Pet Ownership

    • More than half of adults are pet owners
    • Families with young children are key targets…
    • …as well as Millennials
      • Figure 33: Pet ownership, 2020 and 2021
    • Multi-pet insurance policies could be attractive for cat owners
      • Figure 34: Number of dogs or cats owned, 2021
  18. Pet Buying Intentions among Non-pet Owners

    • Future intentions to acquire a pet
      • Figure 35: Intentions to acquire a pet in the next 12 months, 2021
    • Dogs set to remain the UK’s favourite pet
      • Figure 36: Intentions to acquire a pet in the next 12 months, by type of pet, 2021
  19. Pet Insurance Penetration

    • 45% of pet owners say they have pet insurance
      • Figure 37: Pet-related products and services paid for within the last 12 months, 2021
    • New pet owners are more likely to have pet insurance
      • Figure 38: Pet-related products and services paid for within the last 12 months, by new pet ownership, 2021
    • More than half of dog owners have insurance
      • Figure 39: Penetration of pet insurance, by type of pet, 2021
  20. Level of Cover Held

    • Policyholders opt for mid-level and lifetime covers…
    • …but they would be interested in features that lower insurance premiums
    • Lower-priced policies are less popular
    • Penetration of pet health plans is limited
      • Figure 40: Level of cover held, 2021
    • Policyholders with mid-level and lifetime covers are more likely to renew
      • Figure 41: Likelihood of taking out or renewing a pet insurance policy, by level of cover held, 2021
  21. Future Intentions to Take Out or Renew Pet Insurance

    • 62% of dog and cat owners are likely to take out or renew pet insurance
      • Figure 42: Likelihood of taking out or renewing a pet insurance policy, 2021
    • Experienced pet owners appreciate benefits of cover
    • Good intentions to renew existing policies
      • Figure 43: Likelihood of taking out or renewing a pet insurance policy, by pet insurance ownership, 2021
  22. Purchase Barriers

    • Cost is the main barrier
    • More than a quarter prefer to put money aside
      • Figure 44: Pet insurance barriers, 2021
    • More transparency to tackle a lack of trust
      • Figure 45: Attitudes towards pet insurance, by barriers, 2021
  23. Interest in Pet Insurance Incentives

    • Incentivise by offering discounts on routine health treatments…
    • …and pet-related services and products
      • Figure 46: Potential incentives to switch pet insurance policies, 2021
    • 24/7 video consultations with a vet appeal to lockdown pet owners
      • Figure 47: Incentives to switch pet insurance policies, by pets acquired during the lockdown, 2021
    • Price incentives plus useful features have the widest appeal
      • Figure 48: TURF Analysis of pet insurance incentives, 2021
  24. Attitudes towards Pet Insurance

    • Supporting animal charities is important for dog and cat owners
    • Majority would be willing to pay more for pre-existing conditions
    • Pet tech devices could help to lower premiums
      • Figure 49: Attitudes towards pet insurance, 2021
  25. Appendix – Data Sources, Abbreviations and Supporting Information

    • Abbreviations
    • Consumer research methodology
  26. Appendix – Central Forecast Methodology

    • Market forecast and prediction intervals
      • Figure 50: Market forecast for UK pet insurance, 2021-26
    • Market drivers and assumptions
      • Figure 51: Key drivers affecting Mintel’s market forecast, 2020-25
    • Forecast methodology
  27. Appendix – COVID Scenario Performance Methodology and Assumptions

    • Scenario performance
      • Figure 52: COVID-19 scenario forecasts for pet insurance, 2016-26
    • Rapid COVID recovery, central and extended COVID disruption scenarios outline
    • Scenario methodology

About the report

This market report provides in-depth analysis and insight supported by a range of data. At the same time, introductory and top-level content is provided to give you an overview of the issues covered.

Market

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Consumer

Mintel’s proprietary consumer research provides our analysts with the attitudinal and behavioral data used to provide valuable insight to topical issues.

Brand/Company

Mintel provides overviews of the top brands and manufacturers, and uses consumer research to explore attitudes and reactions to brands, as well as insight into what will resonate with consumers.

Data

Market reports provide appendices of data to support the research and insight produced. Our databooks* are easily manipulated and downloadable to support your research needs and covers factors from consumer attitudes to market forecasts.

*databooks not available with UK B2B Industry reports.

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