This presentation is designed to provide the information needed to understand self-funding, assist you in explaining the solution to clients and then determine whether it is right for their company by comparing and contrasting it to a fully insured solution.
The Pros and Cons of Self-Insured vs. Fully Insuredbenefitexpress
This webinar reviews which factors and employer should consider in self-insuring and full benefits. It will discuss the legal, administrative, and ee issues.
Insurance is a social device for spreading the chance of financial loss among
a large number of people. Insurance protects against pure risk.
Risk is the possibility of losing economic security.
Risk can be of two kinds: speculative or pure And only pure risks are insurable
Pure risk involves only two possible outcomes:
loss or no loss, with no possibility of gain or profit
Speculative Risk
involves three possible outcomes: loss, no loss or profit
The Law of Large Numbers:
The average of the results obtained from a large number of trials should
be close to the expected value.
Underwriting:
The process of selecting certain types of risks that have historically
produced a profit.
Peril:
A potential cause of loss. Accident, fire, and theft are common perils.
Hazard:
Anything that increases the seriousness of a loss or increases
the likelihood that a loss will occur.
Adverse Selection:
Is the tendency of person with a higher than average chance
of loss to seek insurance at the average state, which if not
Controlled by underwriting, result in higher than expected
Loss levels.
Insurance is not same as gambling. Gambling is creat a new
speculative risk and socially is unproductive but insurance
Deals with pure risk and socially is productive.
Insurance is not same as hedging. Insurance involves the
Transfer of pure risk and reduce objective risk but hedging
Involves just the transfer of speculative risk not risk
Reduduction.
Types of Insurance:
Private insurance, consist of health insurance, property and
liabilty insurance.
Government Insurance, cnosist of social insurance and other
Government insurance programs.
How does insurance work?
You pay a fee called a premium, and in exchange,
the insurance company agrees to pay you a certain
amount of money
-Basic Characteristics Of Insurance
Pooling of losses
Payment of fortuitous losses
Risk transfer
Indemnification
-Pooling of losses
Spreading of losses incurred by the few over the entire group.
• Key mechanism is “law of large number”.
• Future losses are predicted based on law of large number.
Note
• Pooling of loss is the spreading of losses incurred by the few over the
entire group so that in the process average loss is substituted for actual loss.
• The primary purpose of pooling is to reduce the variation in possible
Outcomes , which reduces risk.
-Payment of fortuitous losses
A fortuitous loss is one that is unforeseen and
unexpected and occurs as a result of chance.
Insurance policies do not cover intentional losses
-Risk Transfer
Risk transfer means that a pure risk is transferred from
the insured to the insurer,who typically is in a stronger
Financial position to pay the loss than the insured.
-Indemnification
Means that the insured is restored to his or her approximate
financial position prior to the occurrence of the loss.
- Insurable Risk
Insurer normally insure only pure risk.
This presentation is designed to provide the information needed to understand self-funding, assist you in explaining the solution to clients and then determine whether it is right for their company by comparing and contrasting it to a fully insured solution.
The Pros and Cons of Self-Insured vs. Fully Insuredbenefitexpress
This webinar reviews which factors and employer should consider in self-insuring and full benefits. It will discuss the legal, administrative, and ee issues.
Insurance is a social device for spreading the chance of financial loss among
a large number of people. Insurance protects against pure risk.
Risk is the possibility of losing economic security.
Risk can be of two kinds: speculative or pure And only pure risks are insurable
Pure risk involves only two possible outcomes:
loss or no loss, with no possibility of gain or profit
Speculative Risk
involves three possible outcomes: loss, no loss or profit
The Law of Large Numbers:
The average of the results obtained from a large number of trials should
be close to the expected value.
Underwriting:
The process of selecting certain types of risks that have historically
produced a profit.
Peril:
A potential cause of loss. Accident, fire, and theft are common perils.
Hazard:
Anything that increases the seriousness of a loss or increases
the likelihood that a loss will occur.
Adverse Selection:
Is the tendency of person with a higher than average chance
of loss to seek insurance at the average state, which if not
Controlled by underwriting, result in higher than expected
Loss levels.
Insurance is not same as gambling. Gambling is creat a new
speculative risk and socially is unproductive but insurance
Deals with pure risk and socially is productive.
Insurance is not same as hedging. Insurance involves the
Transfer of pure risk and reduce objective risk but hedging
Involves just the transfer of speculative risk not risk
Reduduction.
Types of Insurance:
Private insurance, consist of health insurance, property and
liabilty insurance.
Government Insurance, cnosist of social insurance and other
Government insurance programs.
How does insurance work?
You pay a fee called a premium, and in exchange,
the insurance company agrees to pay you a certain
amount of money
-Basic Characteristics Of Insurance
Pooling of losses
Payment of fortuitous losses
Risk transfer
Indemnification
-Pooling of losses
Spreading of losses incurred by the few over the entire group.
• Key mechanism is “law of large number”.
• Future losses are predicted based on law of large number.
Note
• Pooling of loss is the spreading of losses incurred by the few over the
entire group so that in the process average loss is substituted for actual loss.
• The primary purpose of pooling is to reduce the variation in possible
Outcomes , which reduces risk.
-Payment of fortuitous losses
A fortuitous loss is one that is unforeseen and
unexpected and occurs as a result of chance.
Insurance policies do not cover intentional losses
-Risk Transfer
Risk transfer means that a pure risk is transferred from
the insured to the insurer,who typically is in a stronger
Financial position to pay the loss than the insured.
-Indemnification
Means that the insured is restored to his or her approximate
financial position prior to the occurrence of the loss.
- Insurable Risk
Insurer normally insure only pure risk.
2016 Presentation to the Benefits Committee of the TSA Texas Sign Association on the concept of self-insured group medical stop loss captive for employee health insurance.
Life insurance 101- Basics for BeginnersJoan Mullally
There are many different kinds of life insurance policies that can help you plan for the future in case the unthinkable should ever happen. Discover the essentials about life insurance so you can make the best financial decisions for you and your family. Learn more about Term life insurance, whole life insurance and more.
Your Human Resources may get prone to Accidents during working premise or working hours resulting Death, Disability or other bodily damages arising Legal Liabilities to you. Get yourself covered with Workment Compensation Insurance Policy. Click https://squareinsurance.in/contact
Life Insurance Basics provides an overview of most of the types of life insurance products available today and reviews the basics of policies, contracts, beneficiaries and how to buy life insurance. Part of the continuing series of presentations in the Financial Services Industry Training. Contact us if you need training developed for your organization.
This presentation will explain the rationale and process that will help you decide which funding method, Fully Insured or Partially Self-Funded, is appropriate for the health insurance in your organization. If it is Partially Self-Funded, the (patent pending) softeare will determine the most effective stop loss limit. Monte Carlo simulation software (patent pending) will also provide you a risk reward analysis. For a presentation with sound, call 888-781-2698.
Direct to Employer - Dealing With Narrow Networks in the 'New Exchange World'McKonly & Asbury, LLP
This webinar was hosted by Tyler Wenger and Suzanne Sentman from McKonly & Asbury with special guest host Ernie Tsoules from Rhoads & Sinon.This presentation addressed the fact that self-insured employers are increasingly seeking to reduce employee health care costs. A new model of achieving this goal is taking hold in the market by employers contracting directly with new types of health care provider networks, commonly referred to as “narrow networks." This session explored the evolution of these new arrangements and its impact on employers, health care providers and employees. The session also addressed the key business and legal issues that are important to consider in developing these new relationships.
Check out our Upcoming Events page for news and updates on our future seminars and webinars at http://www.macpas.com/events/
2016 Presentation to the Benefits Committee of the TSA Texas Sign Association on the concept of self-insured group medical stop loss captive for employee health insurance.
Life insurance 101- Basics for BeginnersJoan Mullally
There are many different kinds of life insurance policies that can help you plan for the future in case the unthinkable should ever happen. Discover the essentials about life insurance so you can make the best financial decisions for you and your family. Learn more about Term life insurance, whole life insurance and more.
Your Human Resources may get prone to Accidents during working premise or working hours resulting Death, Disability or other bodily damages arising Legal Liabilities to you. Get yourself covered with Workment Compensation Insurance Policy. Click https://squareinsurance.in/contact
Life Insurance Basics provides an overview of most of the types of life insurance products available today and reviews the basics of policies, contracts, beneficiaries and how to buy life insurance. Part of the continuing series of presentations in the Financial Services Industry Training. Contact us if you need training developed for your organization.
This presentation will explain the rationale and process that will help you decide which funding method, Fully Insured or Partially Self-Funded, is appropriate for the health insurance in your organization. If it is Partially Self-Funded, the (patent pending) softeare will determine the most effective stop loss limit. Monte Carlo simulation software (patent pending) will also provide you a risk reward analysis. For a presentation with sound, call 888-781-2698.
Direct to Employer - Dealing With Narrow Networks in the 'New Exchange World'McKonly & Asbury, LLP
This webinar was hosted by Tyler Wenger and Suzanne Sentman from McKonly & Asbury with special guest host Ernie Tsoules from Rhoads & Sinon.This presentation addressed the fact that self-insured employers are increasingly seeking to reduce employee health care costs. A new model of achieving this goal is taking hold in the market by employers contracting directly with new types of health care provider networks, commonly referred to as “narrow networks." This session explored the evolution of these new arrangements and its impact on employers, health care providers and employees. The session also addressed the key business and legal issues that are important to consider in developing these new relationships.
Check out our Upcoming Events page for news and updates on our future seminars and webinars at http://www.macpas.com/events/
Covert Taxes: Spying Issues in Health & Welfare Benefitsbenefitexpress
Avoid a tax season surprise and make sure your benefits are actually beneficial to your employees. It’s time to ensure you’re keeping your plan non-taxable to your employees and tax deductible for you by learning:
- How to pass the Benefits Test
- Common pitfalls in nondiscrimination requirements
- Covered plans beyond basic health and disability insurance
- The best way to provide tuition assistance to employees
Get your maximum deduction come tax time while maintaining your top-tier benefits with this webinar, featuring advice from benefits attorney Larry Grudzien.
Taking a closer look at what your company needs to know about moving from a fully-insured to a self-funded health benefits environment. Originally presented by Greg Bass, Senior Consultant/Benefits Division Manager for The Starr Group, this presentation shares the "secret formula" for health insurance programs that successfully work WITH ObamaCare!
ACA (mis)Management: What Everyone Has Learned & the Game Plan for 2017benefitexpress
After our first ACA reporting season, it’s time to regroup and review what we’ve learned for 2016. The IRS is eliminating extensions and good faith efforts, raising penalties, and strictly limiting transitional relief.
With higher stakes, ERISA attorney Larry Grudzien reviews the changes to ACA reporting for 2016 and common ACA management issues.
FSAs can do some heavy lifting for your benefits plan – they allow employees to save pretax dollars for healthcare costs without the price tag of other financial wellness initiatives. However, many HR professionals lack a deep understanding of the compliance requirements to offer and administer a well-rounded program for their employees.
If ACA is repealed, there will be significant implications for FSAs. Devise your strategy to:
- Accurately catch employee election changes
- Manage rollover requirements
- Determine who pays first – HSA vs FSA
- Understand COBRA’s impact on an FSA
Get coaching from benefits attorney Larry Grudzien on how to prep now for the legislative impact on FSA administration.
Bearcom extended warranty plan on commercial two way radiosjames Anderson
Bearcom provides extended warranty on two way radio equipment’s purchased for commercial, industrial or public service use thus saving its customer’s precious giving them a peace of mind.
This presentation describes the different services and capabilities offered by Advanced Testing Laboratory (ATL). Serving the consumer products manufacturing and R&D industries, we support, manage and own a broad array of key functions and services spanning the entire product life cycle.
ATL provides access to industry leading technical expertise. Our support team understands your business, your challenges, and your opportunities.
Analytical method development, validation, optimization and transfer is a large part of the work we provide.
All of ATL’s current capabilities were designed to fulfill specific industry or customized client needs.
Our process is designed to engage our clients on a level that allows us to truly understand their needs, goals and difficulties.
It is not about what we currently provide today but more importantly about what we can develop as a solution for our clients tomorrow.
Wikipedia Views As A Proxy For Social EngagementDaniel Cuneo
Wikipedia is now offering up to 7 years of page view data.
Can we use this data to measure social engagement ?
I gather some data in this test of the cancer drug Tarceva to see what the view data looks like.
Active Capital Reinsurance Ltd commenced operations in 2007, mainly providing credit-related reinsurance solutions to financial institutions in Latin America, and it has a general insurance and reinsurance license issued in Barbados.
1-The Basics Parts of an Insurance Contract
Declarations
Definitions
Insuring Agreement
Exclusions
Conditions
Deductibles
Miscellaneous Provisions
Insured
Rider And Endorsement
2-COINSURANCE
A coinsurance formula is used to determine the
amount paid for a covered loss. The coinsurance for-
mula is as follows:
(Amount of insurance carried/Amount of insurance required) * Loss = Amount of recovery
Protecting and Transferring Wealth With Captive Insuranceindmew
Potentially reduce business tax, personal tax, and inheritance tax using a captive insurance company. Family owned businesses can also increase asset protection and increase money passed to future generations.
The NAIC & Center for Insurance Policy and Research have placed a special call for policy position briefs exploring the “potential development of a federal program to provide pandemic related business interruption coverage.”
The Centers for Better Insurance has submitted the attached short policy brief proposing the Payroll Risk Insurance Act.
On May 26, Representative Carolyn Maloney of New York introduced the Pandemic Risk Insurance Act of 2020 (HR 7011).
This proposal draws on the basic framework developed for the Terrorism Risk Insurance Act of 2002. Although nearly two decades old, that program has never actually paid a claim. Accordingly, many of its design features remain (thankfully) untested.
Over 1/2 of the companies in the US have a HSA in place. Some of Washington State's largest companies have introduced HSA's and an option or THE option for employee medical plans. This is a good overview of how HSA plans work.
1. Presented by Brett Webster at AH&T Insurance
bwebster@ahtins.com – (206) 770-3051
2. Employer assumes all or a portion of the risk
for health benefits
Administrative options available to employers
choosing self-funding:
Administrative Services Only (ASO)
Third Party Administration (TPA)
Self-Administrator
Fixed Costs
Variable/Claims Costs
3. Administrative Fee:
Fee charged for claims adjudication, billing,
eligibility, customer service, plan document
maintenance, access fees, managed care fees
Setup Fee:
One-time charge for the input of eligibility and
benefits in order for the plan to be administered
Expected Claim:
Total claims underwriter expects you to have in one
policy year, actuarially determined from your past
claims experience
4. Specific Stop Loss Insurance:
Purchased to protect you when eligible claims
during the policy year on any one individual exceed
the specific liability limit
When this does occur, you are reimbursed by the
insurance company
Maximum:
This is 120% above your expected claims level
Claims that exceed this level are reimbursed by Stop Loss
carrier
120% = Aggregate Attachment Factor; percentage can
vary, but 120% is most common
5. Aggregate Stop Loss Insurance:
Protects you from eligible claims for the entire group
that exceed the annual aggregate liability limit
If eligible claims for entire group exceed the aggregate
liability limit, insurance company will reimburse you for
those claims at end of policy year
Many insurance companies offer “accommodation
agreement” for monthly fee
Special contract provision provides monthly
reimbursement of aggregate claims
6.
7. Specific/Individual Stop Loss:
A shock loss may be defined as an abnormally large
and unexpected claim.
Could be the result of severe accident or serious illness
Insurance companies are prepared for such
occurrences – build margin into premium to help
offset the financial impact shock losses can cause
8. What can the self-funding employer do to
protect assets against such losses?
Stop Loss Insurance is designed to offer effective
protection against excessive claims by limiting the
amount of risk on any individual insured.
100% of covered losses you pay for any individual
in excess of the individual policy year deductible
will be reimbursed for the remainder of the policy
year.
9. Aggregate Stop Loss: The Ultimate Protection!
The expected claims of any given group can usually
be predicted with a fair amount of accuracy and
thus become budgetable.
But, when these expected claims are incurred by a
surprisingly high number of insureds, an unforeseeable
fluctuation occurs.
The impact of any unpredictable fluctuation could
jeopardize the financial stability of a company.
Aggregate Stop Loss Insurance is a precautionary
measure designed to protect you from the unknown,
guarding your assets and preserving cash flow.
10. Example of how a $127,000 claim would be handled:
Employer pays the
deductible amount:
$25,000 If the individual
Stop Loss
Deductible is …the Insurance
$25,000… Company pays the
excess over the
deductible amount:
$102,000
The amount funded but not reimbursed ($25,000 in this example)
will apply toward the Annual Aggregate Deductible.
11.
12. Flexibility in Plan Design
Self-funded plan not bound by state mandates
Risk Management effectiveness through Stop
Loss Insurance
Employer may choose the amount of risk to retain
and the amount to be covered under stop loss
protection. Under an insured arrangement,
insurance company sets the pooling level.
Protection from monthly swings can be controlled
through a Monthly Aggregate.
13. Tax Savings
No premium tax for the self-funded claim fund; thus,
an immediate savings equal to the amount of
premium tax is realized. (Average state tax is 2%)
Assuming annual premium of $626,000 x 2% = $12,520 in
potential savings to you!
Retention
Administration of the plan less expensive under a
self-funded arrangement without sacrificing a
reduction in services
Also the option of choosing services à la carte
14. Additional Cash Flow
Employer holds onto reserves
Assuming annual premium of $626,000:
Projected reserves = $130,416 ($626,000/12 x 2.5).
Self-funding implies that employer must fund for incurred
but unreported reserves. Assuming “reserve” is
maintained in an interest-bearing account, employer can
regard it as a source of income. Therefore, additional
income is generated.
Margin
Insurance companies typically charge 3-10% for
margin (for fluctuations in claims)
Under self-funded arrangement, this component is
eliminated
15. Risk Assumption
Employer assumes risk between the normally
anticipated claim level and Stop Loss Coverage level
Asset Exposure
Employer’s assets are exposed to any liability
created by legal action against the self-funded plan
Fiduciary Responsibility
Employer is responsible