Stop loss Insurance
Medical stop loss is an insurance product that provides protection against catastrophic or unpredictable losses. It is purchased by employers who have decided to self-fund their employee benefit health plans, but do not want to assume 100% of the liability for losses arising from the plans. Under a medical stop loss policy, the insurance company becomes liable for eligible losses that exceed certain limits called deductibles.
Stop Loss is available in two forms: Specific &Aggregate.
Specific Stop Loss is the form of excess risk coverage that provides protection for the employer against high claims on any one individual. This is protection against abnormal severity of a single claim rather than abnormal frequency of claims in total. Specific stop loss is also known as individual stop loss.
Aggregate Stop Loss provides a ceiling on the dollar amount of eligible expenses that an employer would pay, in total, during a contract period. The carrier reimburses the employer after the end of the contract period for aggregate claims. A number of variations are available for each of these two products. Generally, all but the largest employers will want to protect their plan with both specific and aggregate stop loss coverage.
If you are happy with your current Claims Payer (Third Party Administrator) Valley Benefits can offer employers the ability to purchase Stop Loss Insurance independently through our network of Stop Loss Insurance carriers. Doing this can in many cases provide a more competitive environment for your company.
This is usually associated with health insurance, which requires health insurance providers to offer health insurance policies within a given territory at the same price to all persons without medical underwriting, regardless of their health status.
Community rating prohibits insurance rate variations based on demographic characteristics such as age or gender, whereas adjusted or modified community rating allows insurance rate variations based on demographic characteristics such as age or gender.
Community Rating does not allow for Medical Underwriting for you and your employees. This type of insurance can be a viable option depending on the current and ongoing health conditions within your group.