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How are Premiums Built?
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Typically, the only areas of Partial Self – Funding apply to deductible and out of pocket. Because of that, the re – processing of claims is limited; therefore administration costs are reduced. Using claims history and plan design, we can actuarially predict what portion of total claims exposure is needed to build into your premiums. The insurance premium, claims funding and administration fee make up the total monthly premium.
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| ( Example ) |
Single |
Family |
| Medical Premium |
$344.44 |
$818.62 |
| Claims Funding |
$ 56.02 |
$108.00 |
| Administration Fee |
$ 8.83 |
$ 8.83 |
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| Total Monthly Premiums |
$409.29 |
$935.45 |
| #1 Choose An Insured Plan |
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| ( Example ) |
Single |
Family |
| Deductible |
$2,000 |
$4,000 |
| Out of Pocket Max |
$4,000 |
$8,000 |
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| 80% / 20% In Network Co-Insurance |
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| #2 Choose Employee Offered Benefits |
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| ( Example ) |
Single |
Family |
| Deductible |
$500 |
$1,000 |
| Out of Pocket Max |
$1,000 |
$2,000 |
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| 80% / 20% In Network Co-Insurance |
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| #3 Identify the Risk Exposure |
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| ( Example ) |
Single |
Family |
| Insured O.O.P.M. |
$4,000 |
$8,000 |
| Employee O.O.P.M. |
$1,000 |
$2,000 |
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| Difference |
$3,000 |
$6,000 |
| # of participants |
200 |
150 |
| Maximum Exposure |
$600,000 |
$900,000 |
| Total |
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$1,500,000 |
| Funded Usage |
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X 20 % |
| Required Claims Funding |
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$300,000 |
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