Pet insurance and the pandemic

Of the many unexpected consequences of the COVID-19 pandemic, perhaps one of the more surprising is an increase in pet insurance claims. With the pandemic resulting in extended lockdowns, it seemed initially that pets benefited, as owners were home more often and devoted more time to them. It now appears, however, that the reverse is also true – when owners return to work and school, pets may suffer. Another side effect is that owners have paid more attention to their pets’ health and have noticed, and have had more time to deal with, health issues that might otherwise have been overlooked.

The COVID-19 virus does not appear to affect pets directly. New Zealand pet insurer PD Insurance reports that while animals can catch COVID-19 and international research shows that one in five pets will likely catch the virus from their owners, cats and dogs generally have mild symptoms, if any at all. PD Insurance also report that, while studies have shown that humans can pass the virus to animals, our pets do not appear to pass it to us.

Internationally, insurers have reported an increase in pet insurance claims over the past year, specifically claims for behaviour-related issues such as anxiety. In an article in the Times, specialist UK pet insurer Scratch & Patch (yes, really) reported a threefold increase in dog behaviour issues in 2021. Increases in claims for anxiety and behavioural treatment over the course of the pandemic may have a variety of causes. Separation anxiety is a known cause, which may have been exacerbated as owners begin to head back into the office, particularly for new pets that had never known anything different. PD Insurance’s animal shelter partner, HUHA, reported increased instances of separation anxiety as a particular problem after New Zealand’s first lockdown, as new pets became accustomed to having its owner home 24/7 and it was traumatic when they were suddenly gone all day. Symptoms of this can include soiling the house, persistent barking and howling or meowing and scratching, digging holes, general destruction and escaping.

Interestingly, an earlier article published in the Times during the period in 2021 when most people in the UK were in lockdown reported that not all pets appreciated their owners being home all day. Cats were reportedly suffering from increased stress and anxiety because their owners were working from home and disrupting their solitary routines.

Fielding-based Totally Vets advise that pets may display signs of stress when there is an abrupt change when owners go back to work and school, leaving them home alone again, and these pets can show signs of separation anxiety and exhibit destructive behaviours which may require prescription medication – resulting in pet insurance claims. Vets have also warned about cats showing signs of stress during lockdowns, with an increase in restlessness and avoidance behaviour.

One New Zealand insurer has reported that an additional impact of the pandemic in New Zealand is that since the outbreak of COVID-19 and the resulting lockdowns, people have had more opportunity to monitor their pets’ health. When pet owners are better placed to notice if something is wrong with their pets, including whether they are acting differently, avoiding food, or other relatively minor changes that might not otherwise have been picked up, they are more likely to take them to a vet.

Pet insurance pay-outs have been reported as being at an all-time high overseas. In the United Kingdom, according to the Association of British Insurers, the average claim cost insurers GBP817 in 2020, compared with GBP486 in 2010.

"Pet insurance pay-outs have been reported as being at an all-time high overseas.“

There are also benefits to insurers, however. In New Zealand, a pet insurer reported in 2021 that the uptake of pet insurance is likely to grow by around 25% over the next 12 months as a result of increased pet ownership during the pandemic. This jump in pet ownership is expected to be the main driver of growth in the market, alongside the increasing cost of veterinary treatment in New Zealand and improved consumer education around pet insurance.

In New Zealand, pet insurers continue to educate people on the value of pet insurance to mitigate the risk of expensive veterinary bills. Both internationally and in New Zealand, insurers have emphasised that people are often not aware of the extent of veterinary expenses for pets, especially as much of our medical health system is free or heavily subsidised so it is easy to forget that this is not also the case for pets’ costs. Pet insurance has assisted owners to deal with psychological issues affecting their pets without a concern about the cost of treatment adding to the stresses they already face as a result of the extended lockdowns.

Authored by Esmée Powell, a Solicitor in our Litigation and Dispute Resolution team.

Read Cover to Cover – Issue 24

Who can help