Two former Munich Reinsurance Co. executives have launched a managing general underwriter to market medical stop-loss insurance directly to self-insured employers.
By bypassing the broker to sell to employers directly, Reinsurance Direct Inc., founded by former Munich Re Stop Loss Inc. executives Paul Fallisi and Susan Bowman, claims to save employers money by eliminating brokerage commissions, fees and overrides, the firm said Tuesday in a statement.
The firm, based in Salem, New Hampshire, and Carlsbad, California, offers both specific and aggregate stop-loss policies with maximum reimbursements of $1 million, $2 million, and $5 million, as well as unlimited reimbursement, Mr. Fallisi, CEO of Reinsurance Direct, said in an email.
Other policy options, such as aggregating specifics, are also available, he said.
The policies are underwritten by Transamerica Premier Life Insurance Co. and are currently available in California, Connecticut, Delaware, Florida, Massachusetts, Maryland, New Hampshire, Ohio, Pennsylvania and Virginia, Mr. Fallisi said. The firm plans to offer coverage in 20 states by February and in all states by the end of next year.
Stop loss insurance helps companies that self-insure their health plans protect themselves against catastrophic claims.
Reinsurance Direct claims typical savings could be between 12% and 16%, but can be as high as 30% in some cases.
“While many factors such as contract provisions and customer service go into the decision of purchasing stop-loss insurance, the most important factor is price,” Mr. Fallisi said in Tuesday's statement. “Until now, most stop-loss insurance has been sold to employers through brokers. Unfortunately, the combination of brokers' commissions, fees and overrides may add 10% to 30% to the employer's cost.”
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