Pet insurance is becoming increasingly popular in the UK but, do you really need it?

Some pet owners self insure their pet by saving a regular monthly amount instead of paying premiums to an insurance company. If your pet requires treatment, there are funds available to pay all or some of the cost. If you don't, the money just rolls up gaining interest and is always yours.

In practice, self insuring your pet should only be considered in limited circumstances and for pets that are unlikely to cause injury or accident to others which could result in legal action. For example, if a dog, directly or indirectly, injures another pet or even a person, you could be faced with hefty vet or medical bills at best. At worst you could be on the receiving end of court action and substantial legal claim.

So, for most pet owners, insurance is a prudent choice but are all pet insurance policies equal?

TOP TIPS FOR CHOOSING PET INSURANCE

1. Compare the price
2. Consider the policy excess
3. Are you protected by lifelong cover?
4. Look at other benefits
5. Read the small print

1. COMPARE THE PRICE
Obviously, the cost of insuring your pet is an important factor. But different insurers have different ways of pricing pet insurance premiums, so always get a quote for your specific circumstances to compare like with like.

2. CONSIDER THE EXCESS
Pet insurance providers use a number of methods to save themselves money when it comes to paying out claims. The main one is to include a high excess on their policies.

The policy excess is the amount that you have to pay each time you make a claim for a certain condition, so choosing a cheaper product with a higher excess could actually end up costing you money if you do need to claim.

3. ARE YOU PROTECTED WITH LIFELONG COVER
You should check carefully what you are being offered by pet insurers and understand clearly what they mean by "lifelong cover". Understanding lifelong cover can be complicated, but here are a few simple guidelines on the types of cover generally available...

Time limited cover
Some plans will only cover a condition for the first year you claim.

For Example: If your pet developed arthritis, you might be able to claim up to £2,000 for the first year's treatment, but no more. You would then have to cover the cost of treatment every year yourself, for the rest of your pet's life.

Financially limited cover
Some insurers call their financially limited cover 'lifelong cover'. In this case, an insurer will pay out each year, but only up to a fixed total amount for each condition. After that, they will stop paying out.

For Example: If your pet developed diabetes and you had a policy that was financially capped at £3,500, you may need to claim £2,000 in the first year. By year two, the amount you can claim for treatment of the diabetes is now just £1,500. After this, you would have to pay for the treatment for the rest of your pet's life.

Lifelong cover
The best pet insurance is cover that pays for treatment up to a certain amount, every year, for as long as your pet needs treatment.

For Example: If your pet developed epilepsy and your policy covered up to £3,000 every year, you could claim for treatment up to this limit each year for the rest of your pet's life.

4. LOOK AT OTHER BENEFITS
Whilst cover for vets fee's is the key element of pet insurance, most insurers offer a range of additional benefits. These can include cover for:

• The cost of advertising and reward to recover your pet if it were to go missing;
• The cost of looking after your pet if you have to stay in hospital;
• The original purchase price of your pet if it is lost or passes away;
• The cost of your pet causing damage for which you are legally liable.

There are many other policy benefits available, so read through the full list of cover benefits to make sure the insurance you have is right for you.

5. READ THE SMALL PRINT
All insurance plans have terms and conditions to make clear what is covered and what is not. Some providers make this clearer than others so be certain you are fully aware of how and when the policy will or will not pay out.