Challenges

The company faced several challenges with traditional health insurance:

• High Premiums: The market rate for health insurance exceeded $1.2 million annually.
• Limited Flexibility: Traditional plans offered little room for mid-term changes or customization.
• Administrative Complexity: Managing employee changes like terminations or additions mid-term was cumbersome.

Union Risk Services’ Solution

The company joined a health insurance captive, leveraging the following process:

1. Open Enrollment and Census Submission:
   • Before the renewal date, the company conducted open enrollment and gathered employee data (census).
   • The data was submitted to the captive for underwriting.
2. Stop-Loss Insurance Proposal:
   • The captive provided a stop-loss insurance proposal, protecting the company from large claims.
   • The proposal was reviewed and approved by the company.
3. Third-Party Administration (TPA):
   • A TPA, such as Meritain, handled plan administration, working with A-rated carriers like Berkeley for underwriting and claims management.
   • The TPA acted as a “wholesaler,” streamlining the process for the company.
4. Employee Management Portals:
   • The captive set up portals for the company to manage employee changes mid-term, such as:
   • Adding or terminating employees.
   • Adjusting non-structural aspects of the plan.
   • This provided flexibility and ease of administration.
5. Cost Savings:
   • The company’s total premium through the captive was reduced to $450,000—significantly lower than the $1.2 million market rate.