Did you know that your current benefits provider may have forty percent to sixty percent more of your money in their bank than they need – and that they intend to keep it?
Understanding How Your Reserves Work
At your first renewal benefits insurers collect and put aside a portion of your health and dental premiums to pay for claims that your employees have paid for but have not yet submitted (this is known as IBNR – “incurred but not reported”). Your benefits insurer holds onto these fund as long as your plan is in place – and if you switch your insurer, your new insurer does the same thing.
It’s Time To Release Your Reserves
On average, benefits insurer set aside 40% to 60% more reserve than what is needed to pay claims – of your money! This ties your funds up so that you can’t use it to run your business, while the insurer earns interest on those “extra” funds.
We didn’t think this was right either, which is why we introduced GroupHEALTH’s exclusive Release of Reserve® program for any GroupHEALTH client with 16 employees or more. This program helps employers either avoid building IBNR reserves to begin with, or give them the option to get back the IBNR reserves that were previously collected.