Our insurer gave us the ‘PUSH-OFF’
LIFETIME pet cover is a purchase that is meant to provide peace of mind. A deal that promises to pick up the cost of an expensive vet’s bill if a much loved companion is ever ill or injured. Not once but for the pet’s life.
Fine and reassuring in theory, but the reality can be very different as dog owner Tony Dearsley discovered recently. He was left stunned when he was told he could keep his lifetime pet cover – but only if he was prepared to pay an annual premium three times higher than the year before, a staggering £7,410.
He believes the sum demanded was a ‘push off’ premium, designed to persuade him to lapse cover because the insurer no longer wanted to cover his ageing dogs. He had diligently paid the premiums for the past ten years without complaint or delay.
Tony’s case is yet another example of a loyal customer being discriminated against by an insurance company determined to protect its profits. In recent months, The Mail on Sunday has campaigned for loyal customers of insurers – covering anything from home contents to their car – to be treated fairly.
Consumer action group Fairer Finance says trust in the industry is declining – often because insurers fail to manage expectations properly. Its recent report ‘Misbuying Insurance’ revealed that rising numbers of people are ending up with policies that do not meet their needs.
What makes Tony’s treatment so unedifying is that the type of policy he bought for his two bichon frise dogs, Sophie and Harry, is held up by the insurance industry as the ‘gold standard’ of cover.
As its name implies, lifetime cover is designed to meet claims for the whole life of a pet, even for ongoing conditions developed after insurance is first purchased. The only proviso is that there must be no break in payment of premiums.
Policy buyers expect the premiums for this type of cover to become more expensive as their pet grows older and has medical issues. But not a renewal premium three times the amount paid the year before.
Tony, from Northampton, took out lifetime cover with MoreThan (part of Royal and Sun Alliance) for his dogs when he bought them as puppies ten years ago. This meant they were covered for treatment of all possible medical conditions, subject to an annual limit of £12,000 per dog. The claims pot resets at the beginning of each new policy year. Tony paid the premiums for a decade, not blinking when they rose given both his beloved dogs had developed diabetes, requiring daily insulin injections.
In 2016, Tony, married to Karla, paid £156 a month – £1,868 a year – for the joint policy, with a one-off annual excess of £75 for each dog.
Last year, the price rose 38 per cent to £214 a month (£2,572 for the year), with the excess doubling to £150 – then to this year’s £7,410. Tony says: ‘I realise insurance companies need to make a profit but they should not exploit existing policyholders by trebling premiums. It seems they simply want me to go away.’
Switching insurer is not an option. Other providers would either reject an application outright because of the pets’ ages or exclude all previous and existing conditions from any cover offered. Tony says:
‘I rang MoreThan to check if it had made a mistake but it said the quote was correct.
‘It said I could get a 25 per cent premium discount if I switched to another policy with a smaller annual claim limit of £4,000.
‘But this meant starting a new policy excluding all pre-existing conditions.’
Tony feels ‘deceived and angry’. He has sent a formal complaint to the company and will go to the Financial Ombudsman Service if he is not given a satisfactory explanation.
The Ombudsman received more than 1,500 gripes about pet insurance in the last financial year, a rise of 38 per cent. Most disputes concerned policy exclusions with almost one in three upheld in the customer’s favour.
MoreThan insists the premium offered to Tony was not a ‘push off’. The company says it reflects the age of the dogs, their ongoing diabetes and the claims history.
Between December 2016 and November last year, it paid nearly £ 12,000 in claims across two policy years. The company says a brochure accompanying t he renewal quote explains premiums can rise because of age and increasing vet costs. But there is no mention of quite how stratospheric they could go.
Martyn James, of online complaints service Resolver, says Tony’s situation is ‘ sadly not unusual’. He adds: ‘Lifetime pet cover is slowly vanishing. The twin threats of too many claims and rising veterinary costs have made it unprofitable.’
Instead of buying cover, James suggests that new pet owners should consider building a savings pot that can then be dipped into if and when veterinary bills need to be paid.