Stop-Loss Market May Be Hot Opportunity for Health Insurers

While it’s become common knowledge in the health insurance sector that employer-sponsored coverage isn’t a major growth market, stop-loss insurance is bucking that trend. And with Blue Cross Blue Shield plans in particular not taking as much market share as they could, stop-loss could present attractive opportunities to health care-focused insurance carriers, experts say.

As it applies to health coverage, stop-loss insurance is typically paired with an administrative services only (ASO) contract, in which an employer pays its workers’ health care claims and hires an insurer to process those claims and perform other administrative functions. By adding stop-loss coverage, a self-funded employer is able to have that policy cover any “high-dollar” claim above a certain threshold, called an attachment point, thus minimizing the employer’s risk.

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