Zurich Financial Services Australia has entered the domestic pet insurance market through a new arrangement with Honey Insurance, with distribution handled by BOQ Group under the Virgin Money brand. The move adds another option to a line of business where pet ownership is high but insurance penetration remains comparatively low.
Under the collaboration, Zurich and insurtech Honey have developed a pet insurance product covering accidental injury and illness, with optional benefits for dental illness and routine care. The cover is being offered as Virgin Money-branded pet insurance. The policy includes access to a “Dial A Vet” service, which connects customers to a veterinary network for complimentary phone consultations. The service is designed to provide general advice on possible treatment pathways and next steps when pets are injured or unwell.
Alex Morgan, head of general insurance at Zurich, said changing expectations in retail insurance are influencing how pet products are being built and delivered. “Customers are increasingly seeking pet insurance options with generous annual limits, comprehensive coverage, and strong customer service, underpinned by sophisticated technology that takes friction out of the process. The co-creation of this product has leveraged Honey’s insurance expertise, digital capability, and customer centricity, combined with Zurich’s global and local strength. It also represents a key milestone in the growth of Zurich’s general insurance business in Australia as we continue to invest in scaling and innovating the propositions it offers,” Morgan said.
Honey chief executive David Krawitz said the arrangement brings together distribution reach and technology-led servicing. “Australians love their pets, and they deserve insurance that reflects that. By combining Zurich’s expertise and financial strength, Honey’s technology and customer-first approach, and Virgin Money’s reach and digital brand, we’ve created comprehensive cover that’s straightforward to access and easy to use when it matters most,” Krawitz said.
The launch comes against a backdrop of rising veterinary costs and evolving attitudes toward pet care. Advances in diagnostics, surgery, and ongoing treatment – combined with an ageing pet population – have contributed to higher and more complex claims costs. Industry data indicates that in 2024, around 30% of dog owners and 21% of cat owners in Australia held pet insurance, while an estimated 66% of households owned at least one pet. The Australian pet insurance market was valued at $239.8 million in 2023 and is forecast to grow as awareness increases and more products reach the market. From a risk-transfer perspective, pet insurance enables households to spread the cost of unplanned veterinary treatment, including emergency interventions and longer-term conditions. The market extends beyond dogs and cats to other companion animals such as birds, reptiles, and small mammals, which can raise additional questions around eligibility, coverage scope, and pricing.
Despite its growth trajectory, pet insurance remains a discretionary purchase for most owners. Average annual veterinary expenses have been estimated at about $1,715 for cats and $3,218 for dogs, leading many owners to express concern about the affordability of major procedures. That tension between cost and access to care sits alongside inflationary pressures in veterinary services and medicines. Public debate about options for improving affordability has included proposals such as an “animal Medicare” concept, signalling continued attention on how pet healthcare is funded. This environment raises issues around premium adequacy, benefit design, sub-limits, waiting periods, and the handling of pre-existing conditions, particularly as pets live longer and more treatments become available.
Several themes are shaping the segment:
These dynamics may prompt a reassessment of where and how pet insurance fits within personal lines conversations, including whether it is offered alongside home, contents, and motor or only on a stand-alone basis.
Zurich’s entry via its partnership with Honey and distribution through Virgin Money sits within a competitive landscape that already includes health funds, general insurers, retailer brands, and specialist pet insurance providers. Brands currently active in the Australian pet insurance space include ahm, Australian Seniors, Australian Unity, Bow Wow Meow, Buddy, Budget Direct, Bupa, Coles, Everyday, Fetch, Guardian, Guide Dogs, HCF, Knose, Kogan, Medibank, Orivet, PD Pet Insurance, Pet Circle, Pet Insurance Australia, Petbarn, PetCover, Petinsurance.com.au, PetMed, Pets On Me, Petsy, Potiki, Prime, RAC, RACQ, Real, RSPCA, Trupanion, and Vets Choice.
The Zurich-Honey-Virgin Money product adds another option backed by a large international insurer and a local insurtech, with virtual vet support included as part of the offer. As veterinary costs increase and companion animals are more frequently treated as part of household risk planning, advisers may consider how pet insurance is incorporated into broader discussions about managing unexpected expenses and long-term care for pets.
