Looking at the broader picture, Lifetime cover premiums finished the year -1.9% lower than in January, despite a steady increase between March and October that saw prices climb by 2.2%. The dramatic shift in November effectively erased these earlier gains, marking a key turning point in the year’s pricing trends.
Time Limited and Max Benefit Cover Defy the Trend
While Lifetime cover premiums fell, Time Limited and Max Benefit policies followed a different trajectory. These policy types have experienced steady inflation, rising by 13% throughout 2024. The divergence in pricing strategies across policy types suggests insurers are recalibrating their approach based on risk, claims experience, and competitive positioning.
Pricing Variations by Pet Age and Type
Premium shifts also varied by pet age and type. Older pets (aged 6+) saw the most significant price reductions in Lifetime cover, while premiums for younger pets (aged 1-3) have reverted to their early 2024 levels. All other age groups experienced a -4% decline.
Meanwhile, cat and dog pricing, which showed different trends in Q1, converged over the year. However, notable differences remain. Premiums for cats increased by 2% over 2024, whereas premiums for dogs fell by 3%.
Regional Disparities
Regional disparities in pet insurance pricing remain significant. Scotland and Northern Ireland stand apart, with premiums unchanged since January, bucking the trend seen in the rest of the UK. In contrast, premium decreases were the norm across other regions, with London seeing the sharpest drop at -5%.
Frances Luery of Pearson Ham Group, said: “This year’s pet insurance market has been anything but predictable. The sharp drop in Lifetime cover premiums in November countered months of steady increases, highlighting how insurers are adjusting their pricing models. “As we move into 2025, insurers will need to balance competitive pricing with sustainable underwriting. The challenge will be ensuring pricing remains fair and transparent while managing profitability.”
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