Healix Specific Stop Loss Insurance
Healix Health Services has long been known as a leader in healthcare trusts and has now introduced a specific stop-loss insurance designed to protect clients’ corporate healthcare trust funds from the impact of high-cost individual claims.
It already offered aggregate stop-loss insurance, to provide insurance protection if total claims exceed the estimated claims fund. This cover is usually activated when claims reach 100% or 125% of the fund, although different levels can also be agreed.
The new policy adds £100,000 specific stop-loss insurance to the contract so that if any individual claim exceeds £100,000, the balance above £100,000 will now be met by an insurance policy rather than by the trust fund.
Specific stop-loss insurance means clients’ healthcare trust funds are not only protected from total claims exceeding the estimated claims fund, as before, but also from any individual high cost claims Healix says. The cover also means that, with the claims fund being less susceptible to spikes from high-cost claims, the estimated claims fund required may be reduced for future years.
The cover is underwritten at Lloyd’s. Premiums attract IPT (as with all stop-loss policies – although otherwise payments into healthcare trusts generally do not).
Comment: Since the early 1990s, healthcare trusts have become a common way for larger employers to fund PMI type cover for their employees. The arrangement gives a number of potential advantages, and one of those is that payments in by the employer do not attract IPT.
However, and especially with trusts now available to much smaller firms (down to just 100 employee schemes on Healix’s schemes), a single high claim or a run of claims can seriously affect budgeting - and the effect is immediate. Healix already offered aggregate stop-loss insurance so that employers could ensure that if claims exceeded the fund, an insurance policy would kick in and pay the excess.
Now, specific stop-loss has been added to so that individual claims won’t have too great an effect either immediately and on future years’ funding.
Premiums attract IPT but that’s a small price to pay for the greater security that stop-loss insurance offers to healthcare trusts.
Plus points: Specific stop loss to help manage and budget for large claims e.g. for cancer treatment; Simple add-on to a healthcare trust; From an established trust player.
Not so plus points: As with all stop-loss insurance, premiums are subject to IPT; Adds to the cost of running a healthcare trust initially.
Website: www.healix.com.
Rating (max 10): Innovation: 8. Overall: 8. Gold
Tags: PMI; Healix