Captives and Employee Benefits
Self-insurance for healthcare or other employee benefits generally provides benefits to employees and to the owner’s business itself.
With the financial burdens imposed by the Affordable Care Act (ACA), careful planning may allow businesses to save significantly on penalties AND premiums. Employee benefits in captives/cells is the fastest growing use of captives/cells today.
All businesses benefit from having a properly structured and ERISA qualified self-insured health plan in these ways:
- Freedom to design the plan to cover (or not cover) things that make sense for the business (i.e. a plan doesn’t necessarily have to provide coverage for contraception).
- Exemption from potential penalties (generally $2,000 per year per employee) imposed by ACA.
- Ability to offer multiple health plans (i.e. basic plan and a more full featured plan).
- More control over premium costs, including loss control procedures that inure to the owner rather than a third-party insurer.
Generally, a properly structured insurance program provides for stop-loss (or reinsurance) coverage whereby any losses in the worst-case year are generally limited to approximately 110% of premiums in any given year. Other drawbacks are also generally limited with proper oversight of the entire plan.
Generally, a properly structured insurance program provides for stop-loss (or reinsurance) coverage whereby any losses in the worst-case year are generally limited to approximately 110% of premiums in any given year. Other drawbacks are also generally limited with proper oversight of the entire plan.
Contact us today to discuss your employee benefits!