Has corporate consolidation broken the pet insurance model?

According to recent findings from the Competition and Markets Authority (CMA), pet insurance is facing a market-wide squeeze due to consolidation within the veterinary industry. As of 15 October 2025, this consolidation has been observed reshaping pricing, competition — and inevitably, insurance claims. For pet insurers, this isn’t news. Rising veterinary bills have been inflating claims costs for some time, and these rapid changes are not down purely to the usual, day-to-day inflation, nor are they down to changes in the quality or administration of clinical care.

Instead (according to the CMA), they are influenced by the evolution of ownership structures within the veterinary practice market, with large veterinary groups (otherwise known as LVGs) now owning up to 60% of local practices; a considerable jump from their mere 10% share in 2013. The CMA alleges that acquisitions by these groups display a strong correlation with 5% higher insurance claim values, as well as average prices jumping 9.2% higher over the four year period following a takeover.

For insurers, that means a material, ever-increasing pressure on loss ratios. With the rise of treatment costs, claims costs can do nothing but follow.

Kesh Thukaram, Best Insurance’s very own chief executive, claims that “the sector remains overly reliant on traditional underwriting models built around static risk indicators such as breed, postcode and claims history. The industry is effectively underwriting averages rather than underwriting pet health itself.”

He perceives the solution to lie in a shift towards bespoke, personalised underwriting methods that rely on real-time health data. Whether that data is sourced from wearables, AI-enabled diagnostics, preventative care tools, or pet health monitoring, one thing is clear: insurers need to find a way to price risk more dynamically.

Read more about the changes driving the pet insurance market here!