Pet premiums for lifetime cover fell by 2.4% in Q2, according to the latest Pet Insurance Pricing Index from consultancy Pearson Ham. This nullified the 2.2% increase recorded in Q1. On an annualised basis, premiums are 2.7% lower than they were in June 2024.

In contrast, Pearson Ham said time-limited and maximum-benefit policies had maintained their upward trajectory over the past year. It said this was due to a lack of competition in these segments where fewer providers offered such policies.

Frances Luery, product manager at Pearson Ham Group, said: “The cooling of lifetime prices in the second quarter shows how responsive the pet insurance market has become to competitive pressure. After a brisk start to the year, rate reductions across most cover limits have taken the heat out of premium inflation – although time-limited and maximum-benefit products continue to move to their own rhythm.

“For insurers, the lesson is that nimble, data-driven pricing remains essential: consumer sensitivity to price is high, yet there are still pockets where capacity is constrained and margins can erode quickly if not monitored.”