As medical costs continue to rise and uncertainties related to healthcare reform threaten employers’ level of control, more employers are looking to alternative risk financing options.
A Deductible Reinsurance Policy is an insurance policy that allows you to reduce costs, maintain control, and benefit from the underwriting profits that would traditionally benefit a commercial insurance carrier.
A Deductible Reinsurance Policy can be used by an employer who is fully or partially self-insured for employee health insurance benefits. It allows the employer to prefund their specific deductible and aggregate attachment points via an actuarially justified premium. After the employer has hit the attachment point, a stop loss reinsurance policy kicks in to cover claims that exceed the prefunded premium
How Does This Help a Business Owner Control Costs?
- Allows business owners to retain more predictable risk while transferring more volatile layers to reinsurer
- Reduce costs, maintain control and retain underwriting profits that would otherwise go to a commercial insurer
- Akin to renting versus owning a home – one is profitable asset for landlord, the other allows you to build wealth
For employers with at least 100 employees, a Private Insurance structure can help control healthcare costs and may even offer valuable tax savings.