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Last year saw pet insurance pay-outs hit a new record of £785 million according to the Association of British Insurers (ABI).
A market with plenty of potential
Surprisingly, the number of claims made has actually gone down, but the average size of each claim continues to rise. In 2018 the increase was five percent, to £793 per claim. The research puts this down to the higher costs of increasingly sophisticated medical procedures for animals.
Despite this, most pet owners still do not buy insurance. Barely one in five cats is protected by insurance and only 32% of dogs are covered. This shows that the market can still grow significantly if the public perceive pet insurance as value for money. The bad news for insurers is that, while the average amount of a claim has increased by 75% in the last decade, the average premium has only risen by 50%. Insurance companies are faced with the choice of either cutting margins or becoming uncompetitive.
Using digital insight to drive business
There is an alternative. Technology can help insurers transform the efficiency of their operations, delivering opportunities to be both competitive on premiums and deliver outstanding customer service. One obvious opportunity is to effectively integrate all aspects of the insurance process – from delivering accurate quotes to collecting premiums and underwriting to claims management – in one simple process. This reduces both time and the need for human intervention as well as increasing customer satisfaction.
Insight from the vast quantities of relevant data that can be collected on claims can also help to identify breeds that are particularly susceptible to illness or injury. This can ensure that quotes genuinely reflect the likelihood of claims, enabling insurers to manage risk more effectively.
Aquarium Software can help insurers deliver the most efficient insurance process to customers as well as supporting them to drive more accurate risk management. Our software platform is trusted to insure more than half a million pets in the UK and we help insurance companies settle hundreds of millions in claims every year. Why not find out how Aquarium can help you carve a more customer friendly and profitable business from the pet insurance market? Contact us today.