Table of Contents
Introduction
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- Abbreviations
Executive Summary
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- The market
- Value of pet insurance market is expected to increase
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- Figure 1: Forecast for value of the pet insurance market, by GWP, 2007-17
- Channels to market
- Market factors
- Veterinary expenses account for 32% of household spend on pets
- Technological advancements and better treatments leading to higher costs
- Fraudulent claims are increasing
- Companies, brands and innovation
- Market share
- Brand promotion
- Who’s innovating?
- The consumer
- Pet ownership
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- Figure 2: Pet ownership, August 2012
- Pet insurance ownership
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- Figure 3: Pet insurance ownership, August 2012
- Pet insurance providers
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- Figure 4: Pet insurance provider, August 2012
- Influencing factors
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- Figure 5: Influencing factors, August 2012
- Attitudes towards pet insurance
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- Figure 6: Attitudes towards pet insurance, August 2012
- What we think
Issues in the Market
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- Is the squeeze on household incomes leading to a reduction in pet insurance sales and product cancellations?
- Has the proliferation of price comparison sites made consumers look only at the cheapest policies?
- Has the fraudulent claims culture spread to the pet insurance market?
- Do pet insurance holders trust insurers to pay out on claims?
Trend Application
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- Extending product offerings to make a more complete package
- Marketing insurance as part of a healthy lifestyle
- 2015: East Meets West
Market Drivers
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- Key points
- Cats and dogs are the most popular pets in the UK
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- Figure 7: Top pets in the UK, 2009-11
- A third of pet expenditure goes onto veterinary and other services
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- Figure 8: Proportional annual household spend on pets, 2010
- Veterinary expenditure has more than doubled since 2001/02
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- Figure 9: Annual household spend on pets, 2001/02-2010
- Better treatments and technology, but higher costs
- Changes needed to tackle rising costs
- Complaints about pet insurance increase in 2011/12
- Insurance sales holding up relatively well…
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- Figure 10: GDP quarterly percentage change, Q1 2008-Q3-2012
- …but pet abandonment is on the up
- Fraudulent claims are increasing
- Charities and self-insurance present some competition to providers
SWOT Analysis
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- Figure 11: Pet insurance market SWOT analysis, 2012
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Who’s Innovating?
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- Key points
- First multi-pet insurance comparison service launched
- Petplan redesigns policies to prevent customer confusion
- MORE TH>N signs deal to sponsor pet channel on MSN website
- Churchill launching pet insurance debut advert
- Summer heat leads to discount on pet insurance policies
Market Size and Forecast
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- Key points
- Pet insurance premiums up by 12.5% in 2011
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- Figure 12: Estimated value of the pet insurance market, by GWP, 2007-12
- Ownership of pet insurance down slightly in 2012
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- Figure 13: Pet insurance ownership, 2007-12
- Market forecast
- Value of pet insurance market will continue to grow over the next five years
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- Figure 14: Forecast for value of the pet insurance market, by GWP, 2007-17
- Figure 15: Forecast for total value of pet insurance market, at current and constant prices, by GWP, 2007-17
- Forecast methodology
- Fan chart explanation
Market Share
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- Key points
- A handful of underwriters dominate the UK pet insurance market
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- Figure 16: Pet insurance underwriter market share, based on GWP, 2011
- RSA makes big gains at the expense of Direct Line Group
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- Figure 17: Overview of proportional market share for pet insurance providers, 2009-11
Companies and Products
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- Agria Pet Insurance
- Allianz Insurance Plc
- AXA Insurance
- Direct Line Group
- Equine and Livestock Insurance
- Royal & Sun Alliance
- New entrants
Brand Communication and Promotion
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- Key points
- Adspend falls by 34% in the year to August 2012
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- Figure 18: Topline advertising expenditure in the pet insurance market, 2008/09-2011/12*
- Top five advertisers account for around 75% of adspend
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- Figure 19: Top 20 advertisers of pet insurance, 2009/10-2011/12
- Pet insurance advertising is dominated by television campaigns
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- Figure 20: Pet insurance adspend, by media type, 2009/10-2011/12
Channels to Market
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- Key points
- Specialist providers account for around two fifths of product sales
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- Figure 21: Channels used to buy pet insurance, August 2012
- Around 68% of pet insurance holders arrange cover online
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- Figure 22: Methods used to arrange pet insurance, August 2012
Pet Ownership
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- Key points
- Over 50% of internet users have a pet in their household
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- Figure 23: Pet ownership, August 2012
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- Figure 24: Pet ownership, August 2012
- Women are more likely to live in a household with pets
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- Figure 25: Pet ownership, by gender, August 2012
- Presence of children and partner influential for pet ownership
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- Figure 26: Pet ownership, by presence of own children, household size and marital status, August 2012
- Around 46% of private renters have a pet
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- Figure 27: Pet ownership, by housing situation, August 2012
- Most pet owners have only one pet
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- Figure 28: Repertoire of pet ownership, August 2012
Pet Insurance Ownership
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- Key points
- Significant scope to increase pet insurance ownership
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- Figure 29: Proportion of pet owners who have cover for that pet, August 2012
- Household income plays a large part in pet insurance ownership…
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- Figure 30: Pet insurance ownership, by socio-economic grouping and gross annual household income, August 2012
- …as does an improvement in consumers’ financial situations
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- Figure 31: Pet insurance ownership, by financial situation compared to a year ago, August 2012
Pet Insurance Providers
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- Key points
- Specialist providers and mainstream companies lead the way
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- Figure 32: Pet insurance provider, August 2012
- No discernible difference between dog and cat owners
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- Figure 33: Pet insurance provider, by pet insurance ownership, August 2012
Influencing Factors for Arranging Pet Insurance
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- Key points
- Veterinary costs are the biggest driver of pet insurance uptake
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- Figure 34: Influencing factors, August 2012
- Cheaper premiums are important, but providers can also leverage their brand image
- Small differences between dog and cat owners
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- Figure 35: Influencing factors, by pet insurance ownership, August 2012
- Adults influenced by lifetime cover more likely to buy from specialist insurers
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- Figure 36: Pet insurance provider, by influencing factors, August 2012
- Cheap monthly premiums are more appealing to those without pet insurance
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- Figure 37: Potential reasons to take insurance, August 2012
Attitudes Towards Pet Insurance
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- Key points
- Two thirds of pet owners shop around before taking out cover
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- Figure 38: Attitudes towards pet insurance, August 2012
- Only a quarter of policyholders trust insurers to pay claims
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- Figure 39: Attitudes towards pet insurance, by attitudes towards pet insurance, August 2012
- Potential to simplify policy terms and aid product comparison
- Specialist providers slightly more popular among consumers looking at cover, and not just cost
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- Figure 40: Pet insurance provider, by attitudes towards pet insurance, August 2012
- Quality of cover is more important for those influenced by lifetime policies and reputable brands
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- Figure 41: Attitudes towards pet insurance, by influencing factors, August 2012
Appendix – Market Size and Forecast
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- Figure 42: Best and worst case forecast for total value of the pet insurance market, by GWP, 2012-17
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Appendix – Pet Ownership
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- Figure 43: Any pet ownership, by demographics, August 2012
- Figure 44: Dog(s) pet ownership, by demographics, August 2012
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- Figure 45: Cat(s) pet ownership, by demographics, August 2012
- Figure 46: Repertoire of pet ownership, by demographics, August 2012
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Appendix – Pet Insurance Ownership
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- Figure 47: Any pet insurance ownership, by demographics, August 2012
- Figure 48: Proportion of overall UK online population that has pet insurance, by type of animal covered, August 2012
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Appendix – Pet Insurance Providers
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- Figure 49: Pet insurance provider, by demographics, August 2012
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Appendix – Influencing Factors for Arranging Pet Insurance
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- Figure 50: Influencing factors, by demographics, August 2012
- Figure 51: Potential reasons to take insurance, by demographics, August 2012
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Appendix – Attitudes Towards Pet Insurance
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- Figure 52: Attitudes towards pet insurance, by demographics, August 2012
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