Think vet services are the biggest expense? A 2025 AMA survey showed that Australians spend over $21 billion annually on their pets, with food making up nearly half of that amount! And Pet Insurance only comes in fourth place.
Two kinds of pet care costs
When you bring a pet into your life, you take on two types of costs. The first type is predictable and easy to budget for—expenses like food, grooming, the occasional toy, annual health checks, vaccinations, and parasite prevention.
The second type is more unexpected—injuries, illnesses, and emergencies that can arise suddenly and without consideration for your finances. This is the part of pet ownership that can be hardest to plan for.
The problem with unexpected vet bills
It’s possible that your pet is one of the rare few who sails through life without any major health issues. However, it’s more probable that your pet may eventually develop or suddenly have a medical condition.
In a Dog Aging Project study of 27,541 companion dogs in the U.S., only 20.7% of mixed-breed dogs and 22.3% of purebred dogs had no owner-reported medical conditions. This implies that roughly 78% to 79% had at least one medical condition during life.
While your pet can have an easily-treatable allergy, it’s also possible that they interact with a snake, tear a cruciate ligament, or develop a chronic condition that requires ongoing treatment. The costs in these emergencies can escalate to tens of thousands of dollars.
| The top 10 most common claimed conditions in dogs | |||||
| Vet cost (invoice) | Knose paid (benefit) | ||||
| Condition | Typical Range | Max Claim Amount | Max Covered | Average Covered | |
| 1 | Gastro-intestinal/digestive system disorders | $160 –$729 | $25,715 | $20,572 | 73% |
| 2 | Skin disorders | $149 –$315 | $9,073 | $6,211 | 71% |
| 3 | Ear disorders | $124 –$329 | $7,500 | $6,253 | 68% |
| 4 | Leg, hip and shoulder disorders | $100 – $1,026 | $15,941 | $12,593 | 77% |
| 5 | Eye disorders | $120 – $282 | $7,522 | $6,017 | 67% |
| 6 | Anal disorders | $37 – $156 | $6,000 | $4,800 | 69% |
| 7 | Tumours, warts, cysts, growths and abscesses | $110 – $1,550 | $15,662 | $12,369 | 76% |
| 8 | Urinary system disorders | $93 – $579 | $18,910 | $12,500 | 73% |
| 9 | Feet & claw disorders | $108 – $540 | $8,362 | $6,690 | 69% |
| 10 | Respiratory system disorders | $111 – $413 | $27,302 | $16,427 | 72% |
How does Pet Insurance actually work?
Pet insurance pools the uncertainty faced by insured pets. That is, rather than each pet owner facing the entire spectrum of potential outcomes alone—which can range from a simple allergy treatment bill to major surgical expenses—pet insurance spreads this risk across a large group of pet owners.
This way, pet insurance helps make the cost of caring for your pet more predictable, instead of leaving you to face the full financial risk on your own. In other words, pet insurance may not be cheaper overall for every pet owner, than having no pet insurance.
What you are paying for is protection against the risk of large, sudden vet bills. You’re paying to reduce that risk for a more manageable cost of protecting your pet.
Knose is a highly-awarded pet insurance provider because we offer quality services and products to clients. Maintaining a high standard also comes with the operating costs behind the scenes.
As a leading pet insurance company, we have to keep up with the cost of staying a financially strong insurer that can pay claims when you need us.
The risk of having an uninsured pet
According to an Australian financial report, one of the biggest barriers to accessing veterinary care is the cost:
40% of pet owners say they would consider economic euthanasia if treatment costs reached $3,000.
It’s a reality faced by many uninsured pet owners: if something serious happens, the funds simply aren’t available or they have a lack of access to credit. The final choice can be heartbreaking.
Every year, pet owners must make decisions about their pets’ care that no one should have to make solely because of financial constraints.
The purpose of Pet Insurance
Pet insurance exists so that when your veterinarian says, “Here’s what we can do” your response can be “Let’s do it,” rather than “What can we afford?” This is the value of pet insurance.
