The power to settle financial complaints.
The power to settle financial complaints.
This section of our website covers our approach to complaints about pet insurance policies.
Pet insurance is designed to help policyholders pay for unexpected veterinary bills and related treatment. The policies may also provide other pet-related benefits including:
Pet insurance policies are very popular. But like most insurance policies, they do not provide cover for every eventuality. The policies often include restrictions that may not always be obvious to the policyholder.
There are two types of pet insurance policy:
Annual policies are the most common type of pet insurance policy. They cover conditions that arise within the term of the policy – usually 12 months.
When an annual policy is renewed, a condition claimed for during the previous 12 months may still be covered by the new policy if the limit specified in the old policy has not been reached. The limit could be for a period of time or an amount of money.
If the limit has been reached, or the policy is not renewed, then the policyholder will have to pay themselves for any further costs relating to that condition.
This type of policy provides continuous cover (so long as the policy is renewed periodically) for ongoing conditions throughout the pet’s lifetime.
So if a claim is made for a particular condition in the first year, the policyholder may be able to claim for that same condition in later years. The insurer cannot normally amend the basic cover provided by the policy.
The complaints we see usually arise when an insurer refuses to pay a claim. This may happen because the insurer says that:
When we consider these cases, we look at the policy wording and any other relevant documentation, including the policy summary. We take into account any medical evidence provided by vets – particularly clinical notes and written submissions.
We also seek to understand the pet’s condition so that we can decide how it started and how it is likely to progress. The things we take into account include:
Most policies contain similar exclusions and limitations. But if we find that any are significant and unusual, we will look at whether the policyholder was made aware of them – and their scope – when the policy was taken out.
We also look at whether an insurer’s interpretation of key words in the policy conditions was reasonable.
When refusing to pay a claim, insurers often make specific reference to the meaning of certain key words – such as “condition” or “treatment” – in the policy conditions.
Each policy provides a glossary of its key words. Where an insurer defines a term differently from its ordinary and everyday meaning, we will consider whether this was made clear – and brought to the policyholder’s attention.
We sometimes see definitions that are ambiguous and unclear. This means they can have a wider scope than a reasonable person would assume. As a result, we may say that an exclusion or a limitation has been applied in a way that we consider unfair.
Most pet insurance policies do not provide cover for pre-existing conditions. If an insurer refuses to pay a claim because the pet already had the condition before the policy was taken out, we will look at how much the policyholder actually knew when taking out the policy.
We are likely to say it was reasonable for an insurer to reject a claim if:
Pet insurance policies do not normally cover conditions that arise within the first few days of the policy. We are unlikely to say this is unfair. But it is significant – so we will consider whether it was brought to the policyholder’s attention.
Where an insurer simply suggested that the policyholder should read a policy document which mentioned that cover would not begin immediately, we are unlikely to agree that this was enough to bring it to the policyholder’s attention.
But where we are satisfied that the issue was brought to the policyholder’s attention, we are likely to agree it was reasonable for an insurer to refuse to pay a claim if – within the relevant period after the policy was taken out – the policyholder knew about:
If, within the first few days after a policy starts, the pet shows signs of a condition – and the policyholder takes it to a vet – insurers (when refusing a claim made some time later) sometimes say the policyholder was aware of the condition at this time.
However, if we find that the vet told the policyholder there was no problem and that no treatment was necessary, we are unlikely to agree.
Pet insurance policies often limit cover for a condition to 12 months from the first date of treatment. Some policies cover 12 months of treatment from the date of a claim.
Because it is rare for a condition to arise on the date that a policy is taken out, the policyholder may find that they are unable to claim for the full 12 months – if they do not renew the policy.
Policyholders sometimes complain to us that this is unfair – because it requires them to renew with the same insurer for another year, to gain the full benefit of the 12 months cover.
When looking at complaints of this type, we consider whether long-term treatment was reasonably foreseeable. If the vet advises the policyholder that treatment is likely to be ongoing for several months, we may say that the insurer should pay the claim for the full 12 months, even if the policy was not renewed.
However, it is unlikely we would uphold a complaint about an insurer not paying a claim – when the policy term had already ended – in circumstances where:
We sometimes see cases where a policyholder complains that an insurer has substantially increased the premiums when renewing the policy. In these complaints, we look at the circumstances of the case to decide why the premium was increased.
If we find that there was a significant increase in the risk that the policy was covering, we usually say that the insurer was simply exercising its commercial judgement. But we are likely to uphold a complaint, if we are satisfied that the insurer increased the premium to deter the policyholder from renewing.
The cost of paying a claim would sometimes have been the same whenever it was made – for example, where a benign cyst is found by a vet who only recommends its removal more than a year after finding it.
In those circumstances, the insurer might say that the 12-month cover began when the vet found the cyst and initially gave advice. But in these cases, we usually say that the insurer should pay the claim – because it is likely that the cost of the surgery would have been the same whenever it was carried out.
When an insurer settles a claim, it normally tells the policyholder that any future claims for the same condition will not be covered after another 12 months have passed. This helps the policyholder to make an informed decision about whether to renew the policy after the 12 months of cover for that condition has expired.
If the insurer does not highlight this time limit, we will consider whether the policyholder would have continued to insure the pet – if they had known that cover for a particular condition had run out.
Where we are satisfied that the policyholder would not have taken out the policy, we are likely to say that the insurer should refund all the premiums (plus interest) that the policyholder paid after renewing.
Alternatively, we may hold the insurer or seller liable for the cost of treatment – where one of the following applies:
Some conditions in pets are known to occur on both sides of the animal – for example, hip dysplasia. These are known as “bi-lateral conditions” .
If a policyholder makes a claim for a condition on one side of a pet – where it has already previously affected the other side – insurers sometimes say:
We are unlikely to be persuaded by an insurer who says that – because the condition is often found to be “bi-lateral” – then the claim should be rejected, as the first occurrence was over 12 months ago.
But if we are satisfied that the same underlying issue caused the condition, we are likely to agree that it was reasonable for an insurer to reject the claim – particularly if the policyholder was aware that it was likely the second body part would become affected.
For example, if the condition first occurred in the right hip, and then occurred in the left hip 15 months later as a result of the same underlying issue – and if the policyholder had been aware that there were signs of the condition in the left hip for some time – it would be fair for the insurer to reject the second claim, because the 12-month period had expired.
However, if we are satisfied that there is no causal connection between the two occurrences (even where it is the same disease or condition), we will normally treat them as separate claims.
Where a condition has different symptoms and manifestations – despite belonging under one “umbrella” name – we will look at the available evidence, including the vet’s opinion, to see if the two were causally connected.
Equine policies often provide cover in the event of a horse having to be put down. However, most policies contain a condition or exclusion, saying that a claim is not covered unless the decision is in line with the British Equine Veterinary Association (BEVA) guide to best practice when considering euthanasia on humane grounds.
The BEVA guidelines were written with insurance claims in mind. They say that it is up to the attending vet to decide whether to advise the owner if the horse should be put to sleep – regardless of whether or not the horse is insured.
Paragraph 3 of the BEVA guide says that in order for a claim to be paid, it must be shown that:
… the insured horse sustains an injury or manifests an illness or disease that is so severe as to warrant immediate destruction to relieve incurable and excessive pain and that no other options of treatment are available to that horse at that time.
If immediate destruction cannot be justified then the attending veterinary surgeon should provide effective first aid treatment before:
i) requesting that the insurance company be contacted or, failing that
ii) arrange for a second opinion from another veterinary surgeon.
Some equine policies say that the BEVA guidelines must be complied with, for a claim to succeed. However, some policies use different wording – for example:
We will not pay any amount if your vet or our vet believes the illness or injury your horse is suffering from can be treated.
Or:
This section does not insure:
Any amount if the euthanasia was carried out without our consent unless a veterinary surgeon certifies that the suffering is incurable and is so excessive that immediate euthanasia is imperative for humane reasons.
So if we are satisfied that no alternative treatment was available – and that the decision to put the horse down was necessary at the time – we are likely to uphold a complaint about an insurer’s refusal to pay a claim.
In a provisional decision partly upholding a consumer's complaint relating to Halifax's withdrawal from "life-time" pet insurance, the ombudsman sets out his general approach to this kind of case.
This is part of our online technical resource which sets out our general approach to complaints about a wide range of financial products and issues. We would like your feedback on how helpful you found it. Please also use the feedback form below to tell us about anything you think we could clarify or explain better.