Pet insurance lags human equivalent by up to 10 years, but AI could deliver leap forward

PetSure Jenny Williams

Digital customer experience innovation in the pet health insurance industry lags the human equivalent by up to a decade, says Jenny Williams, chief marketing officer at leading Australian pet insurance provider, PetSure, though AI could deliver a significant leap forward for industry adopters.

“The reality of the industry is that it’s about five to 10 years behind human health”, Williams said during a panel presentation at FST’s Future of Insurance 2023 event. “There are still all these things in the way of delivering a good customer experience,” despite expectations from customers of something akin to a traditional health insurer.

The lack of an itemised coding system for vet treatments, for instance, has been a bane for pet insurers, she said.

Rather than having a strict set of codes and fees attached to each treatment (much like Medicare Benefits Schedule codes), veterinarians will simply write any treatments administered on “scrawling vet notes”. For claims on these treatments to be processed, Williams said, real vets are often required to manually read and interpret these notes.

PetSure, however, has found a neat, AI-backed workaround to this largely manual system.

“We’ve started to evolve artificial intelligence (AI) to help read through these vet notes so that we can process claims faster.

“That’s been quite an important development so that people can get that real-time experience.”

However, with no pet equivalent to Medicare, pet insurance customers are still often required to “pay for the full cost” upfront following treatment.

“Realistically, the medical advances that are happening in pet health mean that, whether you’ve got fur or skin, the treatment is around the same cost. So, the [customer] perception is that it should be the same, but because there’s no subsidisation it ends up costing more.”

As a result of this lack of an itemised coding system, capabilities that are often taken for granted in other insurance services, like straight-through processing and real-time processing, “have been really difficult to [deliver]” for pet insurers.

Despite these challenges, however, in 2021 PetSure unveiled its GapOnly payments service, enabling premium holders to pay only for the gap between a veterinary bill and the insurer’s rebate.

“That may seem ‘standard’ to people, but within pet health, that’s quite a unique capability,” Williams said.

“It’s things like that within our space that are important to [improving] customer experience.”

In 2020, PetSure also invested in the five-year-old telehealth startup Vetchat, providing a “first point of triage” for concerned pet owners.

According to Williams, the service has grown significantly since it was introduced, with a 120 per cent uptick in usage just over the last 12 months.

“What we also see is that there’s quite a lot of people going to the vet and wanting to claim, but there’s nothing wrong. It’s new pet parents that are having a bit of a worry or a wobble. So these services can help people enormously”.

PetSure’s recent introduction of a ‘pet health predictor’ also offers pet owners a gauge of long-term costs and health risks associated with diseases and musculoskeletal issues that are likely to affect a particular breed.

“We know from our data that if you’ve got a pet that is this breed and this age, the likelihood of the top five diseases happening to this pet in the next five years.”

“These are things that the data can tell us, and that tech prediction can enable. The more we put that in the hands of customers, the more they can make good decisions.”

PetSure administers around 80 per cent of pet insurance premiums in Australia, Williams said, with most “major insurance” brands on-selling PetSure products.