UK pet insurers are paying out over £1.23 billion in claims annually. This figure has doubled over the last decade, according to a recent analysis of the pet insurance market.
Average veterinary prices have risen by more than 60% since 2016, according to the Competition and Markets Authority (CMA). Policy limits, however, have not followed.
The gap is showing up directly in claims data. Co-payment policies now make up 41% of the UK pet insurance market, up from under one-third at the start of 2025.
Insurers are shifting more of the financial burden onto policyholders to protect loss ratios. Owners, meanwhile, are being left exposed when treatment costs escalate beyond what their policy covers.
Robert Catchlove’s experience in Gillingham, Kent, shows how quickly that gap becomes a financial crisis. His nine-year-old malamute, JD, was diagnosed with immune-mediated thrombocytopenia (IMTP) in November 2023, according to the BBC. The rare blood condition causes dangerously low platelet levels and can relapse without warning.
JD’s most recent relapse required intensive care, blood transfusions and specialist treatment. Total costs pushed beyond a £10,000 policy limit. Catchlove took out a loan to cover the nearly £6,000 shortfall.
“The bills escalated far beyond anything we could have anticipated,” he told the BBC. His insurer, Ageas, covered part of the treatment. The policy’s annual cap, excess fees and a 20% co-payment requirement linked to JD’s age left thousands of pounds as the owner’s responsibility.
Catchlove told the BBC the policy terms had been clearly explained at the point of sale.
“Having insurance made a huge difference, as without it many of the life-saving treatments JD received simply would not have been possible,” he said.
Ageas said it was “very sorry to hear about our customer’s dog being unwell.” The insurer added that its annual fee limit is “higher than the market average” and its excess is “comparatively low.”
Cases like Catchlove’s are feeding a wider complaints problem. Pet insurance carries the highest upheld complaint rate of any general insurance line. The Financial Ombudsman Service (FOS) upholds 52% of pet insurance cases.
Around 12% of pet owners have already cancelled or not renewed cover due to affordability concerns. Co-payments and policy caps are catching owners off guard at the point of claim.
Regulators are taking notice. The Financial Conduct Authority (FCA) has placed pet insurance on its watchlist for potential regulatory action. The regulator cited sharp price rises and persistent failures in consumer understanding. Product manufacturers must now proactively review Consumer Duty fair value justifications before the FCA intervenes.
CMA reforms introduced in March capped written prescription fees at £21 and required practices to publish service prices. Analysts warn the changes will produce a more complex pricing environment for insurers rather than lower costs for owners.
The case is a practical illustration of where policy design leaves customers exposed. Co-payment clauses, age-related excess increases and fixed annual limits all reduce effective cover for older animals with chronic or complex conditions.
Catchlove told the BBC that cost information during treatment “was only shared intermittently until the bill had already escalated.” This raises questions about how vets, insurers and brokers communicate with policyholders during complex cases.
