What is an individual stop-loss?

Specific Stop-Loss is the form of excess risk coverage that provides protection for the employer against a high claim on any one individual. This is protection against abnormal severity of a single claim rather than abnormal frequency of claims in total. Specific stop-loss is also known as individual stop-loss.

What is an aggregate stop-loss?

Aggregate stop-loss insurance is a policy designed to limit claim coverage (losses) to a specific amount. Aggregate stop-loss protects the employer against claims that are higher than expected. If total claims exceed the aggregate limit, the stop-loss insurer covers the claims or reimburses the employer.

How does a stop-loss work in insurance?

Stop-loss insurance (also known as excess insurance) is a product that provides protection against catastrophic or unpredictable losses. Under a stop-loss policy, the insurance company becomes liable for losses that exceed certain limits called deductibles.

What is an individual stop-loss deductible?

Specific (or individual) stop loss insurance limits the self-funded employer’s liability to a predetermined dollar amount (specific deductible) for each employee covered under the health plan. The specific deductible per employee is determined by group size and risk tolerance.

What is meant by stop-loss?

A stop-loss order is an order placed with a broker to buy or sell a specific stock once the stock reaches a certain price. A stop-loss is designed to limit an investor’s loss on a security position. If the stock falls below $18, your shares will then be sold at the prevailing market price.

How many types of stop-loss insurance are there?

two
Protecting You with Stop-Loss Insurance There are two main types of stop-loss insurance: Specific stop-loss insurance protects the plan against an individual catastrophic claim. Aggregate stop-loss insurance covers claims that exceed a given amount for the entire covered group.

What is an insurance aggregate?

For various types of insurance, an aggregate limit is the maximum amount of money an insurer will pay for all your covered losses during the policy period, typically one year.

What does stop loss insurance mean?

What is the difference between stop-loss and reinsurance?

If the primary payer is itself an insurance plan, this protection is known as reinsurance, while if the primary payer is a self-insured employer, it is commonly known as stop-loss insurance.

What is the difference between stop loss and stop loss market?

In case of a Stop Loss Sell Order, the quantity gets filled at the market prices as soon as the prevailing rates move below the trigger price. Stop Loss Market Order is a better type of stop loss order as the probability of the orders remaining pending is lower than in case of stop loss limit orders.

What do you mean by stop loss insurance?

Stop-loss insurance (also known as excess insurance) is a product that provides protection against catastrophic or unpredictable losses.

How is aggregate stop loss insurance different from conventional insurance?

Stop-loss insurance differs from conventional employee benefit insurance. Stop-loss only covers the employer and provides no direct coverage to employees and health plan participants. Aggregate stop-loss insurance is used by employers as coverage for risk against a high value of claims.

Why is the variable threshold important in stop loss insurance?

The variable threshold is based on an aggregate attachment factor which is an important component in the calculation of a stop-loss level. As is the case with high deductible plans, most stop-loss plans will have relatively low premiums. This is because the employer is expected to cover over 100% of the value of claims they receive.

Which is the best description of specific stop loss?

Specific Stop-Loss is the form of excess risk coverage that provides protection for the employer against a high claim on any one individual. This is protection against abnormal severity of a single claim rather than abnormal frequency of claims in total. Specific stop-loss is also known as individual stop-loss.