Dental Insurance Articles
Why Dental Insurance Policy Premiums Can Change Unexpectedly
2010-12-09
Dental insurance premiums can change due to several different factors. Since dental insurance is configured differently than health insurance or auto insurance, the dental insurance company can make changes for individuals or groups without warning.
Rates Change Due to Inflation
The most common reason that dental insurance premiums are increased is because of the varying rates of inflation. Dental insurance prices are based directly on the amount that the insurance company would need to pay out for any dental procedure. When inflation rises, the insurance rates have to rise to compensate for the extra costs. If inflation goes down, it is possible that the insurance company will reduce a customer's rates accordingly. Dental insurance rates can fluctuate as the economy shifts up and down, so insurance customers need to pay attention to large swings in the economy.
Dentist Rates Could Increase
Another reason that dental insurance premiums rise is because the dentists rise their service prices. When the services cost more overall, the insurance company has to cover that additional cost by charging more for insurance. Most insurance companies will warn their customers when a rate change is in the works. In some cases, the insurance company will wait until the annual coverage period has ended to make the rate changes. If the dentist office rates increase dramatically, however, the dental insurance company will have to make the change in the middle of an insurance cycle.
Group Rates Go Up Across the Board
Insurance companies do not change rates for individual consumers very often. What usually happens is that the insurance company changes the rates of an entire group that shares the dental insurance policy. These rate increases are almost always at the normal time of year for the policy to be renewed or changed. This gives customers the opportunity to decide whether or not they want to change the policy or find another insurance company. The dental insurance plan may provide a different kind of incentive to try to keep the customers from leaving when the prices have to be changed. These incentives can be as simple as added coverage options or different deductible plans.
Changes in Dental Network
Sometimes a dental insurance company has to change rates because the dentists that work with the insurance company change. When a dental network is added or dropped it can have a significant impact on the price of insurance. Not every dental network charges the same amount for procedures, so each time there is a shift the insurance company needs to reevaluate their rates. Customers may notice a rate change with the new dental network. Customers may also be invited to change to a new dentist under the new network.