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100%

Non-Refundable Premiums

$aving$

$aving$

Claims Payments

Stop Loss Premuims

Administration & Services Fees

Fully Insured

Self-Funded

A savings will result if claims

are at or below maximum cost.

The maximum cost

of a self-funded plan

is the sum of :

 

 

- Actual claim Payments less

      Stop-Loss Reimbursements

- Stop-Loss premiums

- Administrative Expenses

The maximum cost

of a fully insured plan

is the total of all premiums paid.

Savings Through Self-Funding 

Claims Payments

Stop Loss Premuims

Administration & Services Fees

100%

Non-Refundable Premiums

Fully Insured

Self-Funded

This example features a 150-life group with an average claim year.  

If the plan were fully insured with a $250 Deductible Plan, the employer would pay premiums totaling $1,350,000 per year.  

These are dollars that the employer will not get back from the insurance company.

With claims paid of $875,000,

the insurance company retains $475,000 of the employer-paid premiums as profit.

Employer Plan Savings

Expected Claims

Administration Fees

Reinsurance Premiums

$  65,000

$265,000

$875,000

$145,000

If this plan were self-funded, the employer would:

1)  pay a much lower premium of $265,000 to the reinsurance carrier,

2)  pay a lower administrative fee to the Third Party Administrator of $65,000, and

3)  retain the balance of $1,020,000 of fully insured premiums to pay claims.  

 

If the claims totaled $875,000 for the year,

the employer's plan would provide a savings to the employer of $145,000.

That is greater that a 10% savings in total premium cost.

Self-Funded Savings

It's All About Flexibility

And The Opportunity to Reduce Employer Costs

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EXCELLENCE IN THIRD PARTY ADMINISTRATION

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