Pets can be permanently identified by implanting a microchip under the skin. This is the best way of increasing the chance of a lost pet being returned to you (although best not to lose it at all!).
Microchipping can be done on its own, with vaccination, or while your pet is under anesthetic following an operation. Your pet's details are then logged onto a central database, and you will be given 4 weeks' free insurance.
It is now compulsory for all dogs to be microchipped by law