Source | Insurancenewsnet.com
The Self Insurance Institute of America issued the following news:. The Self-Insurance Educational Foundation today announced the release of a new report detailing key policy characteristics found in the U.S. employer medical stop-loss market. “We are pleased to be able to once again provide objective information about stop-loss insurance,” said…
SIMPSONVILLE, S.C., March 19 — The Self Insurance Institute of America issued the following news:
The Self-Insurance Educational Foundation (SIEF) today announced the release of a new report detailing key policy characteristics found in the U.S. employer medical stop-loss (ESL) market. The report, prepared by Milliman, is an update of a similar study performed last year.
“We are pleased to be able to once again provide objective information about stop-loss insurance,” said Foundation Chairman Nigel Wallbank. “This is consistent with our important role of educating industry stakeholders and policy-makers of how the broader self-insurance marketplace operates.”
The underlying policy data for the report was provided by eight of the country’s largest stop-loss carriers, representing approximately 50% of the market. Milliman assumed the data is a reasonable approximation of the entire ESL market. A summarization of this data revealed the following:
* Employers with 100 or fewer covered employees represent approximately one-quarter of the ESL market if the market is measured by count of employers. If measured by covered employees, however, that same segment represents only 2% of the ESL market.
* A majority of ESL purchasers obtain both specific and aggregate stop-loss. However, most employers with over 1,000 employees purchase specific stop-loss without aggregate. The number of employers purchasing aggregate coverage without specific stop-loss is very small.
* The data included employers that purchased specific deductibles ranging from $5,000 to $2,500,000. However, 80% of employers purchased deductibles of $50,000 or greater.
* The median specific deductible found in the calendar year (CY) 2013 data across all plans was $85,000. For groups with 50 or fewer covered employees, the median deductible in CY 2013 was $30,000. For groups of 51-100 employees, the CY 2013 median was $45,000.
* Approximately 0.3% of specific stop-loss policies with effective dates in CY 2013 had a specific deductible of less than $20,000.
* The data included employers that purchased aggregate corridors ranging from 85% to 200% of expected claims. By far, the most common corridor (found on nearly 90% of policies with aggregate coverage) was 125% of expected claims.
SIEF is a 501(c)(3) educational foundation affiliated with the Self-Insurance Institute of America, Inc. (SIIA). The full report can be accessed through the Resources section of the SIIA web site at www.siia.org.