Current pet insurance premiums
While other types of insurance like health insurance are ‘community rated’ (meaning everyone in a certain age group pays a similar fee), pet premiums are driven by a number of factors, like the breed, age, size, and hereditary conditions of your furry friend.
Our research shows that premiums for pet insurance have increased over the last few years, and according to Medibank rising premiums could be down to the dramatically rising number of pet owners in Australia. Other key drivers could include advances in animal medical treatment and surgeries, the increasing average age of pets nationwide, and the rising cost of vet bills.
When it comes to the cost of insurance, as well as the factors listed above, the type of cover you take out is also a consideration.
The table below shows average pet insurance costs broken down by the key factors.
Average annual pet insurance premiums by pet type – 2017 vs 2018
Policy type: Accident and Illness
|Type of Pet||Age||2017 Average Premium||2018 Average Premium||% Change in Average Premiums|
|Cat||Less than 1 year||$494||$480||-2.81%|
|2 – 3 years||$475||$490||3.12%|
|4 – 5 years||$535||$552||3.16%|
|6 – 7 years||$622||$640||2.90%|
|Small Dog||Less than 1 year||$759||$710||-6.48%|
|2 – 3 years||$702||$730||4.04%|
|4 – 5 years||$810||$848||4.77%|
|6 – 7 years||$1,018||$1,067||4.76%|
|Medium Dog||Less than 1 year||$818||$768||-6.12%|
|2 – 3 years||$757||$786||3.92%|
|4 – 5 years||$867||$904||4.25%|
|6 – 7 years||$1,089||$1,137||4.43%|
|Large Dog||Less than 1 year||$784||$735||-6.25%|
|2 – 3 years||$733||$761||3.90%|
|4 – 5 years||$845||$883||4.42%|
|6 – 7 years||$1,063||$1,110||4.48%|
Policy type: Accident, Illness and Routine Care
|Cat||Less than 1 year||$643||$642||-0.27%|
|2 – 3 years||$591||$608||2.87%|
|4 – 5 years||$648||$663||2.25%|
|6 – 7 years||$740||$759||2.51%|
|Small Dog||Less than 1 year||$901||$851||-5.61%|
|2 – 3 years||$760||$785||3.31%|
|4 – 5 years||$862||$898||4.16%|
|6 – 7 years||$1,066||$1,110||4.18%|
|Medium Dog||Less than 1 year||$963||$908||-5.71%|
|2 – 3 years||$806||$832||3.26%|
|4 – 5 years||$911||$945||3.71%|
|6 – 7 years||$1,125||$1,171||4.14%|
|Large Dog||Less than 1 year||$903||$851||-5.79%|
|2 – 3 years||$762||$785||3.01%|
|4 – 5 years||$867||$898||3.56%|
|6 – 7 years||$1,069||$1,111||3.87%|
|Source: www.canstar.com.au. Average annual premiums are the national weighted averages, based on all cat and dog breeds considered in the Canstar Pet Insurance Star Ratings for 2017 and 2018 (July). National averages are weighted according to population representation for each state (based on data taken from the Australian Bureau of Statistics).|
Based on the data above, you can expect to pay more on average for a larger breed of dog than for a small one. You can also see that ‘accident, illness and routine care’ cover is on average more expensive than ‘accident & illness’ cover. This is because policies including ‘routine’ cover mean you would be protected not only from accidents and illnesses affecting your pet, but typically also procedures such as desexing, microchipping and vaccinations.
Each type of pet cover has its advantages and disadvantages, so it’s worth thinking about the needs of your pet before settling on a particular type.
Pet insurance premiums by age and type of pet
Age is one of the biggest contributors to differences in premiums, as pets tend to become more prone to certain illnesses and condition as they age. However, the data shows that pet premiums are actually cheaper on average at two-three years old than they are at under one year old, before increasing in price as pets get older.
A policy insuring a dog also appears to be on average more expensive than cat cover. Reasons for this may include the greater variety of dog breeds available and the presence of hereditary conditions common in some dog breeds. There’s also the fact that on average cats tend to live longer than dogs.
How much do we spend on our pets?
According to the RSPCA, responsible pet ownership means providing for all the requirements of your pet, which includes paying for their healthcare as well as food and exercise. So insurance is just one of many costs to factor in when it comes to taking care of a cat or dog.
Australia has one of the highest rates of pet ownership in the world, with 63% of households owning at least one pet, according to AMA (Animal Medicines Australia). And it seems we’re more than happy to splash out on them. In total, Australian households are estimated to have spent more than $12.2 billion on pet products and services in 2016 – an increase of 42% since 2013.
Our biggest pet expenses were food (a clear winner at $4.28 billion), veterinary services ($2.24 billion), healthcare products ($1.47 billion) and accessories and toys ($1.09 billion).
Is pet insurance worth it?
This is something that individual pet owners need to decide based on their own situation.
When surveyed by the AMA as to why they don’t have pet insurance, the top responses offered by owners suggest that cost and the value it delivers are big factors:
- Not seeing the value in pet insurance (47%)
- Thinking pet insurance is too expensive (43%)
- Not researching or thinking about pet insurance (18%)
That said, many Australian cat and dog owners do see the value, and as a nation we spend an estimated total of $490 million per year on pet insurance, with households spending almost twice as much on dog insurance as they do on cat insurance. And given that the most expensive pet diagnosis according to the RSPCA (an Oesophageal Perforation) has an average claim of $7,750, it’s not surprising that many pet owners choose to purchase insurance in order to avoid potentially hefty out-of-pocket expenses.
If you do decide to take out a policy, it’s a good idea to compare what’s available from the various providers to make sure you go for the right policy. In particular, it’s important to be aware of the benefits and limitations of each policy, what everything will cost, and what you will and won’t be covered for.