If you’re looking for a less expensive and fully customizable health insurance plan, then a self insured health plan might be just what you need. Read on to learn more about what this type of plan is, and where you can find the best rates.
What is Self Insurance?
With a self insured or self-funded plan, an employer provides health care benefits for its employees. The employer pays claims directly instead of paying premiums to an insurance company.
Benefits of Self Insurance
About 55 million U.S. workers and their dependents receive health care through a self insurance plan. 60% of companies with 500 or more employees operate such a plan, which offers many benefits to employers:
* It can cost as much as 25% less than conventional health insurance policies
* It often offer tax benefits, including not having to pay a tax on monthly insurance premiums
* It can be customized with just the coverage you want
* Employers retain control over the plan’s reserves, allowing the company to invest the money
One danger associated with a self-funded plan is that catastrophic claims can be financially devastating to the company. To help manage the risk, companies often purchase stop-loss insurance to cover catastrophic claims. The stop-loss coverage begins covering the cost of the claim at a predetermined amount set by the company.
Finding a Self-Funded Health Plan
Employers typically work with insurance companies to design and administer a self-funded health plan. To find insurance companies that offer these policies, you can go to an insurance comparison website. On this website, you enter information about your insurance needs.
