How much do pet insurance premiums increase each year

It’s a question many pet owners ask: you’ve found a great insurance policy, but will the price skyrocket next year? The fear of a sudden, large price hike at renewal can be unsettling. You might find yourself wondering, “If I make a claim, will my premium double?” or simply, “Why has my pet insurance increased so much?”

Understanding why premiums change and what to expect at renewal time can help you plan your finances and choose an insurer that offers stability. This guide explains why prices go up, what’s considered a typical increase, and how you can find cover that stays affordable year after year.

Jump to:

• Do pet insurance premiums increase every year?
• Your pet is getting older
• Advances in veterinary medicine
• Making a claim
• How much do pet insurance premiums increase each year?
• Choosing a policy for the long term

Do pet insurance premiums increase every year?

For most pet insurance policies, the answer is yes, you should expect some level of increase at your annual renewal. This can be frustrating, especially if you haven’t made any claims. However, these increases aren’t random. They are based on a few predictable factors that affect the insurer’s risk, which refers to the likelihood of having to pay out a claim. Insurers assess this risk based on factors like your pet’s history, behaviour, or circumstances to figure out how likely you are to file a claim and how much it might cost them.

It’s not just about your individual pet but about wider trends in pet care and the growing risk that comes with age. Let’s break down the main reasons why your pet insurance increases each year.

Your pet is getting older

The most significant reason for price increases is your pet’s age. Just like humans, pets are more likely to develop health problems as they get older. A seven-year-old dog has a higher chance of developing arthritis, diabetes, or heart conditions than a one-year-old puppy.

Insurers adjust the price each year to reflect this increased risk. While the increase might be small when your pet is young, it can become more noticeable as they get older. The higher premium reflects the higher likelihood that you’ll need to use the insurance for age-related illnesses.

Advances in veterinary medicine

Modern veterinary care is incredible. Vets can now perform complex surgeries, offer advanced diagnostic tests like MRIs, and prescribe powerful new medications that can save lives and improve a pet’s quality of life. This is fantastic news for our furry friends, but it comes at a cost.

The price of veterinary treatments is constantly rising due to this innovation. Insurers have to account for these “vet inflation” costs. As an indication, a procedure that cost $1,000 five years ago might cost $1,500 today. Your premium increase helps the insurer cover these rising treatment costs across all the pets they cover.

Making a claim

This is a common concern for pet owners. Will making a claim lead to a huge price hike? With some insurers, it can. If you’ve made several claims or one very large claim in a year, your provider might see your pet as higher risk and increase your premium at renewal. This is one of the most frequent answers to the question, “Why has my pet insurance increased so much?”

However, not all insurers bump up the premium if you claim. It’s important to understand a provider’s policy on this before you sign up.

How much do pet insurance premiums increase each year?

What’s considered a normal increase? The amount can vary significantly between insurers and depends on your pet’s age, breed, and health history.

According to Canstar research, an annual increase of around 7-10% may be standard, reflecting rising vet costs and your pet aging another year.1 However, for older pets or after a major claim, some Australian owners have reported their premiums doubling or even tripling at renewal. These sharp increases are often tied to insurers offering low introductory premiums to attract new customers, only to raise prices substantially in later years.

This can make the policy unaffordable, leaving pet owners with a difficult choice: accept the steep increase or cancel the policy, which could leave an older pet (potentially with pre-existing conditions) uninsured.

To avoid this, it’s crucial to look beyond the first year’s price and research the insurer’s long-term pricing practices. ASIC’s MoneySmart website offers helpful advice on comparing pet insurance policies in Australia to ensure you’re making an informed decision.

How CoverMy Pet Insurance keeps your premiums stable

We don’t believe in surprising our customers with shocking price hikes. At CoverMy Pet Insurance, our goal is to provide affordable, vet-fee-only cover that you can rely on for the long haul. We understand that sustainable pricing is just as important as the cover itself.

Here’s how we approach premium increases differently:

Transparent pricing: We are open about why prices change. Yes, your premium will likely increase a little each year to account for your pet’s age and rising vet costs. But our aim is to keep these increases manageable and fair. We don’t lure you in with an unsustainably low price just to double it a year later.

Simple, efficient cover: Our vet-fee-only model helps keep costs down. By focusing on the essential cover you actually need for vet bills, we don’t have to charge for extras that can inflate premiums. Our efficient, digital-first approach also lowers our overheads, and we pass those savings on to you.

When you ask, “how much do pet insurance premiums increase each year?” with CoverMy Pet Insurance, the answer is: enough to reflect the changing risk, but not so much that it becomes unaffordable. We want you to stay with us for the life of your pet.

Choosing a policy for the long term

The best pet insurance policy isn’t the one that’s cheapest today; it’s the one that stays affordable and reliable for years to come.

Look for an insurer that values loyalty and transparency. By understanding that small, predictable increases are a normal part of pet insurance, you can avoid the shock of a sudden price hike and feel confident that your pet will have the protection they need, now and in the future.

Read our policy documents for the ins and outs of our cover.

¹ Canstar