Pet Insurance Review - a waste of reading time?

I’ve just brought up the Choice pet insurance review - hot on the notion that our current pet insurer (RACWA) is quite “adequate”, but expensive AND deliberately difficult to access. RAC have a neat little trick to make your life as difficult as possible when it comes to making a claim - they do NOT allow the vet to forward the claim details on your behalf. You have to solemnly collect a copy from the vet, fill out the form, forward the claim, and await the decision. Now, given the outrageous cost of pet insurance premiums, I’m a bit annoyed that we must jump through an obstacle course to claim our entitlements - something that is not even required for a Medicare claim to a govt department.
So, filled with righteous indignation, I turned to my informant of choice (get it?) for a review and ranking of good value (though not necessarily cheap) pet insurance options…to be severely disappointed.
If you are expecting this report to rank pet insurance - as Choice appears to do with EVERY other product/service review - you will be sorely disappointed. No such ranking is provided.
To rub salt in the subscriber’s wound, there is also NO mention of cost in the review. You have absolutely NO idea how the various (81) options compare on cost. Apparently, the Choice reviewer decided this was an unnecessary complication. I appreciate there are pets of many ages!! But, how hard could it have been to ask each insurer to define precisely its premium for an “average-aged” Australian pet cat or dog? Say, an 8-year old dog and an 8-year old cat (or whatever), then explain their premium cost escalation policy as the pet ages. There ARE such policies in play (10% per age year? 35% per age year?..and so on). There is no mention of how easy it is to make a claim (any insurer can - and invariably does - claim all sorts of “benefits” for their insurance, but then place a raft of “small print” barriers in the claimant’s way). There is no measure of promptness of claim payment. There is a ridiculous parroting of rubbery marketing benefits: for example, payouts can be “60% or 70% or 80%”. What does this even mean? I am prepared to bet my superannuation fund that an insurer that makes such a claim will pay out ONLY 60% on claims for 99% of all claims. The pay-out range cited is utter nonsense, and should not have been tolerated in the review.
There’s more - but I’ve had a gutful now.

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If you look at household insurance or car insurance there is no ranking nor any costs there either. The complexity of the service provided with all its inclusions, exclusions and special conditions is too great to reduce to a single score, among other things because different owners want different coverage and benefits.

Unlike toasters which have but one purpose there are many for insurance so what you get for any given plan is not comparable with the others and so the costs are not comparable either.

I think you are being a little harsh and asking the impossible. If some ranking was cobbled together subscribers would be saying it doesn’t represent the concerns they have in mind and rightly so. There are some situations that are too complex to boil down to a single statistic that actually has any useful meaning.

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I was looking for information I could use, or a place to start other than the hugely expensive insurer we are with. I am no wiser. If Choice can’t figure it out because it’s too complicated, how can we?

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Pet insurance is like most other insurance. You pay a yearly premium to cover you for some or perhaps all of the costs of some possible future event. That event is unknown, and you can only know how good your insurance is when a claim is made.
How can Choice test for that?

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Pet insurance joins mobile phone plans and energy plans as being purchases where determining value requires a thorough understanding of the business, access to data and probably software (like a spreadsheet) to model the outcome of different choices. Insurance is more difficult as it involves assessment of probabilities too.

Whether this complexity is unavoidable or a deliberate ploy to prevent buyers from making a fair assessment of the situation by making comparisons too hard is a question of judgement but some analysts think the complexity in some cases is not warranted.

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Although this topic is about the review and one reader’s expectation, this other topic might provide a better insight into whether pet insurance is worthwhile in any case.

The bottom line is it can be an expensive contribution to shareholders and executive bonus schemes, not so much to pet owners.who only benefit when their pet is unlucky in its younger years.

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I suspect your assessment is not inaccurate: probably I am being a bit harsh (on Choice).
In my defence, I am thoroughly exasperated by obscurantist insurance providers who seem to compete in the deliberate production of the most opaque policies possible. I take you point that toasters are “easier” to assess. That is true. But, alas, in my view that doesn’t entirely get Choice off the hook. If I was looking for “easy” reviews, I wouldn’t be subscribing to Choice, I’d just pull up all the free (and, yes, sometimes dodgy) online product review sites. I think Choice has a duty to tackle even the more difficult assessments - in addition to toasters, TVs etc. That’s kind of what I’m paying for. Failing that, surely Choice could
a) state explicitly and publicly that it is unable to provide an sort of basic review on pet insurance BECAUSE the industry seems entirely focussed on preventing consumers from gleaning information necessary to make a balanced judgment;
b) challenge industry players to up their game AND name and shame the worst practices of the sector (hidden “exclusions”, no price escalation rates, pettifogging bureaucratic hurdles to discourage claims, ludicrous excess charges, etc etc.
I’m most unimpressed by the Choice pet insurance review - it fails to be even minimally informative. I know this sort of opinion is unpopular with Choice staffers, but it is worth recalling that we are not free-riders: we ARE paying a subscription for a service. If Choice cannot (or, will not) provide that service, then they should say so up front, and we can all move on.

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Are you aware that Choice gave the entire pet medical insurance industry a shonky award in 2019?. Choice has also consistently offered the view that pet insurance is not value for money, has too many exclusions, and has not to my knowledge recommended any of them.

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Yup Gregr, absolutely know about the Shonky. Again, if Choice is still unable to provide a constructive industry review in 2022 (the latest report), maybe it should say so - and why - loudly. Then, it could lobby publicly for the industry to be investigated for non-provision of even minimal standards of service at exorbitant cost. Certainly, that message is not getting out, to date. As I recall, this is what was done by the recent royal commission for the wider insurance industry.
Just me ranting, really.
I do appreciate your response though. Thanks.

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I think that most policies in the market regardless of the name that fronts them, are Hollard policies with the same rules and processes behind the makeup on the front.

As noted the Pet Insurance Industry has gained a Shonky from CHOICE. That alone should make it clear that it isn’t what you should invest your money in. Beyond that it can only be a very basic review as the market is almost a Hollard one. There are other providers but it is almost a vanilla affair, why would someone shake up the market when it provides great income to the businesses behind the insurances. Hollard as a business are a private company, there are almost no ways to garner information about their workings unless they release them.

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Hi @Ozcelt

You might consider it to be splitting hairs, but Choice did a Pet Insurance COMPARISON (updated 23 February 2022), not a review.

When comparing you need to make full use of the filters in the left hand column to short list those insurers that provide the benefits that you want based on the cat/dog’s age that runs your home. :stuck_out_tongue_winking_eye:

When I started putting in filters I quickly realized that there were no insurers that covered what I may have wanted, so I started removing filters until one insurer appeared. I could then decide if that one insurer was worth investing in or not, or would it be more worthwhile to self-insure by assuming the risk of not insuring.

Self-insuring may be worthwhile unless you know that your animal’s breed has a predisposition to certain problems which might be very, very expensive to deal with. For example, last week I heard about a dog that had ruptured both front ACLs, costing the owner $12.000!

So when using the Choice Pet Insurance COMPARISON, it is down to you to work out what you want, and what risks you are prepared to accept based on the animal that you are considering insurance for.

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Thanks Meltam. I appreciate the thoughtful response.
I still cannot see that it satisfactorily explains why I am justified in paying a subscription to Choice for a less than stellar comparison/review of pet insurance (and, bear in mind, I’m not talking here about future subs - my sub has already been paid out and cashed in).
If Choice did indeed feel that a proper analysis was made impossible by industry prevarication, then I would have loved to see Choice give the whole “industry” a good (and deserved) public tongue-lashing - rather than producing an anodyne and functionally deficient “comparison” that reeks of dodging the issue rather than confronting it, as I’d hope for a consumer advocacy organisation.
But, I can see already that conflict-avoidance is already well-ensconced at Choice - nobody from Choice has chosen to respond to my “issue”, even if to just disagree.

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The industry did receive a Shonky (noted above in previous posts), which involves a public exposure. I think the Shonky award meets that criteria you have asked about. I haven’t seen any change to the opinion/stance that it was deserved, well none that that have been announced by CHOICE.

Below are just a sample of them.

@BrendanMays may wish to add further to this.

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I think that since CHOICE actually agrees that it is a flawed industry in Australia it would be enough to reiterate that it is a shonky business and maybe name a couple of the worst offenders.
Why review a product that is not worth buying?

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As has been mentioned, Choice provided a comparison of products in the market based on the information provided by the insurer.

It was not a review of the performance of each product.

Many pet owners are interested in insurance, particularly after having huge vet bills, or hearing stories about bills, and want some information about various products out there.

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Fair enough. Good point. Thanks.

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I have had 12 long lived dogs and 2 big, serious surgeries, never had insurance. I estimate I have saved somewhere between $40,000 and $50,000. Just look at the huge profits domestic animals’ insurance companies make! The best start is to carefully choose robust breeds that have health checked and passed parents, then it’s a matter of good care and a lot of luck. Insurance increase Vet bills, they spend sometimes an hour on the paperwork required for insurance companies.
I wouldn’t waste my money. Put the premiums in a box on your fridge and pay for everything from that, then you too will be way ahead after 12 pets!

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Hi all.

Thanks for your comments on this. You are correct that we have pulled our ratings and recommendations from the general insurance products - pet, car, home and travel insurance. i.e. everything but health insurance. The reason is twofold:

  • Lack of pricing - we did used to collect prices either manually or direct from the insurer, but the large number of risks factored into an insurance quote now means this method can no longer be relied on to generate an accurate representation of how an insurer prices itself in a particular market.

  • Lack of claims data - we used to use the complaints data from the Financial Ombudsman Service (FOS). But when FOS transitioned to the Australian Financial Complaints Authority (AFCA), they removed the relative measure of complaints per 100,000 policies (at the insurer’s request of course). This makes it difficult to extract meaning from the complaints data, because obviously the insurers that issue more policies, have more complaints. We have complained to AFCA about this both in private and in public submissions, but we don’t expect they will address this…

This means that we are left with only the policy data that we extract from the Product Disclosure Statements. And while this data is very important, and perhaps the most important criteria to base a policy purchase on, we don’t think it’s enough to justify ratings and recommendations of the policies, hence we have pulled those from the general insurance comparisons.

We agree that it is not adequate value for money for our members to pay for a comparison, as opposed to reviews and recommendations, which is what people expect from CHOICE reviews. Hence the general insurance comparisons (pet, car, home, travel), are not currently paywalled.

The good news is that we’re working on a solution to these issues, though it’s taking much longer than anticipated. At this stage we expect to start by publishing scroing, recommendations and indicative pricing for home insurance in the November 2022 magazine.

Any and all feedback, questions and comments are welcome.

Cheers

Jodi

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Appreciate your comments are about insurances in general and not just for pets.

Are there real concerns not to share the information/data?
Is there value in sharing some of the responses from the responsible representatives of AFCA as examples of why they will not respond more positively?
Has the accountable minister provided feedback in support of Choice’s request or backed AFCA’s position?

It’s not a unique circumstance. There are other areas of consumer need where the industry or professional associations, and possibly with a nod from government prefer to protect the consumer from misinterpreting the statistics. Complaints against builders, those in food preparation, medical specialists to suggest a few.

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Therein lies a problem, at least for the past decade, and perhaps longer.

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