GroupHEALTH Release of Reserve®
Your current provider may have 40% – 60% more of your money in their bank than they need (and they intend to keep it)! GroupHEALTH is the only provider in Canada to offer a “Release of IBNR reserves” program.
IBNR stands for Incurred But Not Reported. IBNR reserves range from a low of 8% to over 20% of the health and dental premiums paid for a program, and they’re charged at the first renewal. Insurers collect this money, and put it aside to pay for claims your employees have paid for but not yet submitted for payment (kind of like insurance for the insurance). They hold on to it as long as the plan is in place. Each time you switch carriers, it gets set up again, and again, and again.
Although ALL the insurers do it, it just doesn’t make financial sense to business owners. It ties up your money so you can’t use it to run your business, and the insurer earns the interest on all those funds instead of you.
On average, insurance companies set 40% to 60% more reserve aside than is needed to pay claims. They simply keep any leftover funds.
We didn’t think it was right either, so now any client company with 16 or more employees, can take advantage of the GroupHEALTH Release of Reserve® program to either avoid building IBNR reserves to begin with, or have an option to get back the IBNR reserves that were previously collected.
We did our first Release of Reserve back in April 2010. It’s just one of… The benefits of trust.™