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In a business update published after-hours Thursday, Trupanion said the rate in California will increase by more than 12%, on top of the 8% increase in November. On the other hand, New York approved a request for an 18% increase, in addition to a 6% increase late last year.
Today’s rally has mostly erased losses from earlier this week when the state of California released a letter opposing the proposed rate increase of 28%, and instead, proposing the 12.6% increase.
Trupanion said it now expects to have 19.7% pricing action flowing through its book by the end of August 2023, and 21.6% pricing action flowing through its book by the end of September 2023.
“We are very pleased with the recent rate approvals from two of our largest states, New York and California. These rate approvals, which are necessary in today’s rising cost of veterinary care environment, demonstrate a big step forward towards achieving our value proposition, which we believe to be the highest in the industry,” Margi Tooth, President of Trupanion, said.
Trupanion also said that the guidance issued in May doesn’t include rate hikes. Still, the company reiterated its intent to deliver positive free cash flow in the fourth quarter of 2023.
“We view these key rate approvals as a net positive to our balance sheet,” Tooth concluded.
