Publication Date : 14-10-2014
Taking out an insurance policy for your cat or dog can protect you from expensive vet bills, but are they worth the cost?
Pet owners in Shanghai are now able to insure their cats and dogs, including unlicensed ones, to cover the costs if their pets fall ill or have an unexpected accident.
In September, China’s two largest insurers, People’s Insurance Company of China (PICC) and Ping An Insurance (Group) Company of China, put forward two products that target animals raised in urban families.
By paying an annual fee between 450 yuan (US$73) and 3,380 yuan, owners can get access to benefits such as a premium to cover medical costs of up to 50,000 yuan and a small subsidy for advertising costs for searching for a stolen or lost pet.
Both companies use advanced DNA identification technology to make the pets’ treatment at the hospital and payout by the insurance companies easier.
As people have more disposable income, pets have become popular additions to urban families, and owners have developed higher expectations for their animals’ healthcare and standard of living.
According to China Animal Agriculture Association, there are about 20 million licensed dogs across China, in addition to another 80 million unregistered at public security offices.
Meanwhile, veterinary medicine is increasingly employing expensive medical techniques and drugs, and treating ear infections for a cat, for example, can cost more than 1,000 yuan at a major veterinary hospital in Shanghai.
“Animals getting ill agitates their owners and can cause an economic burden,” says Zhang Xiaofeng, deputy secretary-general of China Animal Agriculture Association. “The high medical expenditure has become one of the main reasons to dump animals.”
Prior to the release of the two new products, insurance schemes offered by small Chinese insurers proved unpopular, while large foreign companies, like Allianz, have yet to enter the market.
“Because of the poor state of pet identification technology and the incompleteness of the credit system, pet insurance has come late to China and the products on the market were predominantly third-party liability insurances which offer no coverage for pets,” says Lu Zhihua, a division general manager at PICC’s Beijing branch.
Shi Qiuqiong, an account executive at Ping An’s Shanghai branch, says that the terms requiring owners to license their dogs was another important reason that made the schemes unpopular.
“In Shanghai alone, at least 60 per cent of dogs in homes are unlicensed,” she says.
As a result, owners showed little interest in these insurance products, despite them being promoted at pet shops or veterinary hospitals.
“They seldom sell,” says He Zhiying, a sales manager at Shanghai Shenpu Pet Hospital, talking about a product developed by a small insurer and promoted at the hospital.
But people have shown great interests in the two new products. Ping An’s Shi says that by mid-September, the company had sold seven schemes.
However, there are people who say buying insurance for their pets is unnecessary.
Ding Yaqiong, 27, who raises a number of cats and dogs in Shanghai, says: “My pets are not any rare species so there’s no need to buy insurance in case they are stolen.”
Also, the lifespan of an animal is usually about 10 years, much shorter than that of a human.
“I am prepared for the fact that they are more fragile than the human beings,” she says.
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