The saying “better with age” applies to wine and fine cheeses, but probably has never been said about pet insurance premiums. While Embrace will never reduce the coverage for aging pets, the premiums do go up a bit each year as our pets get older to account for the increasing risk of illness. While it’s good news that your coverage remains reliable even as your pet’s health begins to decline, the increase serves as more than just a reminder that your pet is getting on in years and can have some pet parents reconsidering the cost-benefit of their coverage.
This was the case for the pet parent of Ditto, a 10 year old Beagle originally from Cleveland, OH and now living in Seattle, WA. Ditto was one of the first Embraced pets back in 2006 and we enjoyed getting photos and updates from this young lady. Fast forward to 2014 and Ditto’s rates have increased, despite her being relatively healthy. Her most recent increase was roughly 20%, an increase her pet parent felt was “steep” and he wrote in looking for advice on what to do with her coverage. While hesitant to drop the coverage, he seemed to wonder if it made sense to continue with the current coverage as is.
Ditto’s plan:
$500 annual deductible
90% reimbursement rate
$10,000 annual maximum
Optional rider: Wellness Rewards Plus
Our crew was happy to help Ditto’s family evaluate their coverage, discussing the following questions:
How much do you really need the Wellness benefit?
While you pay $299 for the $400 Wellness Rewards Plus coverage upfront, if you do use it all, you'll be making $101 for the year (think of it as a $101 reduction in your accident/illness premium). If you don't expect to use it all, you could decrease the benefit to the $200 Wellness Rewards Basic for the year ($149 cost with $51 savings) or drop it and pay your wellness out of pocket. Most guardians of puppies and kittens find the Plus program essential, while it may not be as beneficial once a pet has reached a maintenance stage of prophylactic care. For example, you may decide to shop around for flea/tick prevention to reduce your need for reimbursement.
Now that your pet is older, would you still proceed with treatment for major medical issues, such as cancer?
Would you go ahead with the chemo treatment or an invasive surgery? If so, you'd probably want to keep the $10,000 coverage. If not, perhaps your annual maximum could drop to $5,000, which would cover recoverable accidents like broken bones, foreign body ingestion, and most illnesses, just not all of the big ones.
How much can you afford to pay out of pocket if your pet is ill?
You could decrease your reimbursement percentage (say from 90% to 80%), which will decrease the premium somewhat, but also decrease any reimbursement you might get. Generally, this ends up being a much bigger “what if” risk, especially as you anticipate major expenses that come up late in life.
Ditto - 2014
A better option is to increase your deductible by $100, lowering the premium. If your pet remains healthy, it would be a savings in the long run. It’s also easier to budget for a set amount of out-of pocket expense.
And, since many of you have been enrolled for years without claims, you can take advantage of the Healthy Pet Deductible benefit, which reduces your deductible by $50 for each year without a claims payout (starting in 2012). Of course, once you’ve had one year of claims that used up that benefit, you'd be back to your regular annual deductible for the following year, but it’s something to think about.
Ultimately, Ditto’s family decided to leave things as is for now, considering their coverage a “good luck charm.” Of course, no one knows if they might have had a big vet expense as soon as they reduced or dropped their coverage, but sometimes it feels better to not take a chance.
Have you ever reconsidered your pet insurance coverage? Our reps are just as good at helping you change the plan as they are at helping you get started, so it never hurts to call (800-511-9172) or e-mail us to re-evaluate the needs, even on a yearly basis.
--Lea Maxwell Embracing change since 2006