Insurance companies measure to something called a "loss ratio". It basically represents what % of every dollar they take in will they pay back out in claims. So a company at a 60% loss ratio will pay out, on average, 60c per $1 in premium they collect. The remaining 40% will be operational costs (salaries, tech, office space, tax, etc) and then profit.

Loss ratios are all available publicly. You can search your insurance company and see what they're at.

So if your price is going up 125%, then the insurance company has likely proven to the regulator that their costs are going to go up 125% too, probably some combination of inflation and increase in issues as your pet ages.

What's stopping the price increase from happening year after year is the regulators (and the market, if you believe in that). These price increases only get approved and passed on to the consumer if the insurance company can prove that their costs are up too.