Why it matters at renewal
Stop-loss is often the fastest-rising line in a self-funded budget, and its contract terms decide what is actually covered. Two quotes with similar prices can protect very differently.
Worked example
A group with a $100,000 specific deductible and an aggregate attachment of $1,500,000.
| Event | Stop-loss pays |
|---|---|
| One member has $340,000 in claims | $240,000 (specific) |
| Total plan claims, after specific reimbursements, reach $1,620,000 | $120,000 (aggregate) |
| Total reimbursed | $360,000 |
Read the transcript
Self-funded plans come with two safety nets. One catches a single huge claim. The other catches a bad year.
Here's one group. Specific stop-loss covers any one person above a hundred thousand dollars. Aggregate covers total claims above one point five million, a hundred twenty-five percent of expected.
Year one. One member runs up three hundred forty thousand dollars. Specific pays the two hundred forty thousand above the line. The plan lands at one point one eight million, under the cap.
Year two. No huge claims, just lots of medium ones, so specific never triggers. But the total hits one point six two million. Aggregate pays the hundred twenty thousand over the cap.
Year three brings both: one point eight two million in claims. Specific takes off two hundred forty thousand. Aggregate takes the last eighty. The plan still stops at one point five million.
Specific takes the shock out of one claim. Aggregate caps the year. Premiums and fees still come on top.
So ask three things. What's our specific deductible? What corridor is the aggregate set at? And does it move with enrollment? Find more at actuariallysound dot com.
Common misunderstandings
Questions to ask your carrier or broker
- What are our specific deductible and aggregate attachment point?
- What is the contract basis (12/12, 12/15, paid), and does it match our situation?
- Is there a rate cap or a no-new-laser provision at renewal?