Jordan Bernstein

Jordan Bernstein from Stifel inquired about updates on Trupanion's go-to-market strategy for a lower-priced insurance plan, specifically whether it would be a Trupanion-branded offering or a remodeled PHI Direct approach, given market demand for more affordable options. He also asked when investors should expect the Internal Rate of Return (IRR) to return above the 30% guardrail, noting it has been below for two consecutive quarters.

Answer

CEO and President Margi Tooth confirmed that Trupanion is exploring both broadening its existing offering to adjust price points and developing a new product offering within the next 36 months to address the market gap for lower-priced options, leveraging the Trupanion brand. Regarding IRR, she explained that the current investment strategy is driven by a 35% year-over-year increase in lifetime value per pet, allowing for more aggressive pet acquisition despite the blended IRR being below 30%. She emphasized confidence in the strong financial background and commitment to high lifetime returns.

Jordan Bernstein from Stifel inquired about Trupanion's go-to-market strategy for a lower-priced insurance plan, asking for updates on a potential Trupanion-branded offering and the future of PHI Direct. He also raised concerns about the Internal Rate of Return (IRR) falling below the 30% guardrail for consecutive quarters and asked when investors should expect a return to above 30%.

Answer

CEO and President Margi Tooth stated that while a new lower-priced product is part of the 36-month plan and not for immediate release, Trupanion is looking to broaden its existing offering to change price points for some. She expressed confidence in leveraging the brand's trust for this new product. Regarding IRR, Margi Tooth explained that the increased investment reflects confidence in the business's strong position, improved lifetime value (up 35% year-over-year), and higher per-pet margins in newer cohorts, despite the blended IRR being below 30%.