Do we need stop loss insurance when we are already self insured?
Not necessarily, but there are a few issues to consider. Since the implementation of the ACA (Obamacare), employers now have no upper limit on the cost of a claim, due to the requirement to have unlimited liability limits. Stop loss insurance will play a key part in limiting that risk for the employer.
In addition to the ACA issue, which applies to all employers, a stop loss broker can help you determine whether you might want stop loss coverage or whether your current stop loss coverage is sufficient by answering just a few questions.
- What has your claims experience been like?
- What are your reserves?
- What is the number of subscribers?
- Do you have any ongoing catastrophic illnesses such as Hemophilia or Cystic Fibrosis?
How long have you been in business as a stop loss broker?
Ask this question, because you want to have confidence that you are placing your business with an experienced, reputable company. A stop loss broker will:
- Make sure there are no hidden exclusions in your policy
- Market your business to multiple carriers they already have a relationship with to ensure the best quote possible
- Determine your direct need for insurance, ie deductible level, additional coverage options, etc.
What will your role be once the business is placed to the stop loss carrier?
An experienced stop loss broker will:
- Track your claims and submit them to the reinsurance carrier
- Track your reimbursements
- Send monthly updates of your claims at 50% and 100% of the deductible
- Dispute any denied claims
Will you be submitting our claims to the reinsurer?
Some brokers will assume your underlying plan will be submitting your claims. You will want to know who is submitting your claims, how they will submit them and how you will obtain your reimbursements.
What work do you do behind the scenes to ensure we are getting reimbursed properly?
An experienced stop loss broker will have a database(s) that will be able to import your claims (if the underlying plan supplies this), and/or the underlying plan will supply claim reports and excess reports to your broker.
Is there a cost for the claim reporting from the insurance carrier?
Insurance companies typically charge to access the information needed to submit claims to your reinsurance carrier.
What information will you need in order to market our stop loss?
In order to obtain the best quote possible for your reinsurance, your broker should obtain:
- Excess claims over 50% for at least 3 years
- Plan Summaries
Should we market the stop loss to more than one carrier?
Yes, always. You absolutely want to make sure you are getting the best quote and by sending it out to more than one carrier you are ensuring that. Expect to solicit at least 3 carriers, but 5-7 is optimal.