Why you can't shop your way out of a pet insurance rate hike
The short version: Auto and home insurers price loyalty as a cost — the longer you stay, the more you pay — and the standard defense is to shop every few years. Pet insurance has the same loyalty penalty buried in its filings: the same six-year-old dog is rated about 3x higher after years of enrollment than as a brand-new customer, and the penalty compounds for life. But the auto playbook does not transfer. The moment your pet has been treated for anything, switching carriers forfeits coverage for it as a pre-existing condition. So you usually cannot shop your way out of the penalty — which is exactly why the carrier you pick on day one, and the shape of its lifetime curve, matters more in pet insurance than in almost any other policy you own.
In auto and home insurance there is a well-worn piece of advice: don't be loyal. Insurers price tenure as a cost — they know long-time customers are less likely to leave over a price increase, so they charge them more — and the way you beat it is to collect fresh quotes every few years and move. The mechanism is documented in public rate filings; the filing that prompted this piece, DNGL-134452278 from Southern Insurance Company of Virginia (part of the Donegal group), is one auto/home example where time-with-the-company moves your rate. Several states have moved to ban the practice outright.
It is tempting to carry that advice straight over to pet insurance. Don't. Pet has the same penalty — but it also has a trapdoor that auto does not, and the trapdoor changes the entire conclusion.
The loyalty penalty is in the pet filings too
For pet filings we rebuild the underlying factor tables, so this is not a guess from an average. Take American Modern's Embrace program in New York. It rates "age & tenure" as a single combined factor — your pet's attained age crossed with the number of years you have been enrolled. Hold the age fixed at six and walk the tenure dimension:
| Six-year-old dog, identical coverage | Age/tenure factor |
|---|---|
| Brand-new customer (tenure 0) | 1.50 |
| Enrolled 3 years | 2.59 |
| Enrolled 6 years (since puppyhood) | 4.48 |
Same dog, same age, same policy. The loyal customer is rated at roughly three times the factor of the person walking in off the street today, and the table keeps climbing out to a tenure of "16+." Pumpkin's filings carry a standalone tenure factor that does the same thing on a separate axis, rising every year you stay out to thirty years. Unlike the aging curve, which at least reflects a real change in the animal, this component compounds purely because you stayed. It does not cap.
The trapdoor: pre-existing conditions
Here is why you cannot just apply the auto playbook and switch. When you move to a new pet carrier, the policy starts fresh — and anything your pet has already been treated for, or shown symptoms of, becomes a pre-existing condition the new insurer will exclude, usually permanently. A torn ACL, a course of allergy treatment, one elevated kidney value at a checkup: any of these can make the conditions you are most likely to claim on uninsurable everywhere else.
So the switch that escapes the loyalty penalty also forfeits coverage for everything that has gone wrong so far. For a young, never-sick pet that is a real option. For the vast majority of pets — the ones that have lived long enough for the loyalty penalty to bite — it isn't. By the time the penalty is large, the exit is usually closed. That is the asymmetry: in auto you can always walk; in pet, the longer you have owned the policy, the more the penalty costs and the more locked in you tend to be.
What the "shop every three years" math actually shows
You can run the simulation — we did, on the real Embrace/American Modern New York table — and on paper it looks like a slam dunk. Follow a dog enrolled as a puppy two ways, holding everything else equal. Stay put: tenure climbs with age. Re-enter at new-business pricing every three years: tenure keeps resetting to zero.
| Pet age | Stay put (factor) | Reset every 3 yrs (factor) |
|---|---|---|
| 0 | 1.00 | 1.00 |
| 3 | 1.73 | 1.08 |
| 6 | 4.48 | 1.50 |
| 10 | 16.10 | 3.12 |
| Sum, ages 0–10 | 57.8 | 19.5 |
About 66% lower on the age/tenure component over a decade. But read what the right-hand column is really assuming: that at ages three, six and nine your pet is still healthy enough to be accepted at new-business pricing with nothing excluded. That is the catch. The savings are not a reward for diligence — they are only available to an animal that never got sick, which is precisely the animal that needed the insurance least. For everyone else, that column is fiction. The honest takeaway is the opposite of the auto one: do not count on shopping your way out later, because the window slams shut the first time your pet is treated for anything.
The credit for prior coverage caps — usually around three years
It is worth knowing the one place tenure can help you, because it is small and front-loaded. When a carrier gives credit for prior insurance or a clean claims history, that credit runs on a short lookback: the plans we parse carry history only a few terms deep — "prior year," "two-year," and "three-year" loss history, and then stop — or bucket prior claims as 0, 1, 2, or "3+." So whatever you bring in saturates at about three years and buys nothing after. The reward for good history caps; the penalty for staying does not. Both point the same way: time helps you a little on the way in and works against you the entire time you stay.
Does it vary by state? A lot.
Heavily — the tenure penalty is exactly what insurance departments scrutinize, so its steepness depends on your regulator. The same age-three, six-years-enrolled dog carries an age/tenure factor of about 2.72 in Massachusetts and 2.90 in New York, but 5.21 in South Dakota and Indiana — nearly double, for an identical animal. You cannot assume the behavior you read about in one state describes your own.
So what should you actually do?
Spend your shopping effort where you still have leverage: at the start, once, before your pet has a history to lose. That is the only moment you can freely compare every carrier on equal footing, and it is the choice you will likely be living with for the animal's life. When you compare, weight the lifetime curve, not the puppy quote — two carriers that look identical at age one can diverge enormously by age eight, because their age and tenure factors climb at different rates, and the cheap intro price tells you almost nothing about what you will be locked into paying later.
You can chart the full lifetime premium for a specific breed and ZIP, tenure included, in the premium calculator, and see how different carriers' curves climb in the aging factors tool. Once your pet has a condition, treat switching with suspicion: compare what a new policy would exclude against what the loyalty penalty actually costs you, and assume the exclusion usually wins. In pet insurance the defense isn't shopping often — it's choosing well once.