Under edHEALTH’s captive, member organizations pick their own self-insured retention level based on their risk tolerance, philosophy, financial status, and experience. In addition to the stop-loss coverage schools automatically receive, they can purchase aggregate stop-loss coverage to further protect their risk. Here’s how the risk financing works:
If a school picks a Self-Insured Retention (SIR) of $100,000 per claim:
- The college will pay any single claim up to $100,000.
- The Educators Health Insurance Exchange captive will pay the next $1-$650,000 for each individual claim from this school.
- edHEALTH purchases excess protection from a stop-loss insurer. This insurer reimburses edHEALTH for any part of a particular claim that exceeds $750,000.
Members work with the actuaries to pick a Self-Insured Retention amount that balances their claims experience with the risk of paying claims and stop-loss insurance. Final rates reflect the level of risk a school wants to take and its claims experience.