Rate increases on Medicare supplement plans are inevitable. However, it’s critical that agents and consumers are prepared for them. Each year, the rates go up a little more than the cost of the plan itself. The average increase is 4.6% for year-to-date 2021, the lowest since 2011. See the chart below for more information. It’s easy to see why many customers are concerned about these changes. Fortunately, there are ways to combat these increases.
The Medicare Supplement rate increases are based on the amount of revenue the insurer spends on claims. If the company’s revenue goes over or below a certain threshold, it can increase premiums. The average increase is around two percent. There have been a few instances where rates increased by as much as 25%. Most increases are small and gradual, so it’s important to compare rates every year. It’s crucial to look at the overall coverage and price to make the most informed decision possible.
The next step is determining when to increase your Medicare Supplement rates. While the rates will go up every year, they generally take effect on the renewal date of your clients. It’s important to shop around and compare the plans available from different carriers to ensure that you are getting the best value. By doing so, you’ll avoid any surprises and ensure your clients get the coverage they need. When it comes to deciding when to raise rates on Medicare supplements, keep in mind that the costs will likely increase as you approach retirement age.
The cost of Medicare supplement plans will continue to increase over time, so it’s important to review your rates now and compare them to those offered by competitors. You should be able to afford the premium increases that come with them. Remember that the rates are set to increase every year, so it’s important to review your premiums as soon as possible. And if your premiums are higher than your income, you’ll want to get a plan with lower premiums.
In addition to carrier policy rates, there’s the age of the client. While most insurance policies will not increase, some will increase their rates on the renewal date. For example, a policy that is a few years old will cost less than one month after the original issue date. As long as you don’t change your plan, the rate will stay the same. But if you’re not a youngster, consider making sure you’re not too old yet.
You can avoid the age-based increase in Medicare Supplement rates by making sure your clients are in-force with their policies. If your clients have not already renewed their policies, it’s best to wait until they renew their policies. This way, they’ll have plenty of time to make changes. Similarly, you should review the age-based rate increases in 2019 to see if you’re better off with a higher rate.