Large deductible plans

While these plan structures are similar, in that the insured business takes on most, if not all, financial responsibility of a loss, the fundamental difference is this: With a large deductible plan, you are still technically insured but you reimburse the insurance company for losses within your deductible. Since you’re insured, the insurance company is ultimately responsible for the loss costs. With self-insured workers’ compensation, the employer, not the carrier or claim administrator, is ultimately responsible for the loss costs. You can discuss the finer point with our knowledgeable people and determine which, if either, of these plans makes sense for you.

The aggregate stop loss limit is the total amount your business is responsible for over the course of the entire period. The stop loss provides you with financial protection against extreme severity—without it, you’d be responsible for paying the full deductible on an unlimited number of claims. Once you reach the aggregate limit, your insurer is responsible for any additional losses and loss development arising from the rest of the policy period. The aggregate stop loss limit is an aspect of the program determined by your loss history and your risk appetite.

As your insurer, we make the necessary claims payments and then bill you for those amounts. When the program is set up, we ask you for financial security when you choose a large deductible workers’ compensation plan. We’ll hold that security in the event that your company isn’t able to pay losses within the deductible. Additionally, you’ll set up an escrow account, which you can set aside specifically for deductible payments when they’re needed. After all, when you—the insured company—are able to pay your deductibles without financial strain, it’s simpler for everyone.