Employee Benefit Captives

With escalating healthcare costs and a complex regulatory landscape, more small to mid-size employers are looking for a solution that can strike the right chord between delivering competitive benefits and managing insurance expenditures. One creative solution is an employee benefit captive, which can be structured to provide medical stop-loss, retiree benefits, group term life and long-term disability, and enables businesses to achieve cost reductions and more control over their plans.

Artex offers a number of captive solutions for employee benefits. One of our specialties is focused on medical stop-loss, either in a single-parent captive for larger companies or a group captive. Our medical stop-loss group captives are designed for companies that have between 50 to 1,000 employees, to manage their healthcare benefit program. Our solution blends the advantages of self-funding with the stability of a group captive, medical stop-loss insurance and proven risk management strategies. We can help employers reduce healthcare costs, improve employee wellness, streamline healthcare delivery and achieve long-term stability.

How does our solution work?

Artex's program allows participating employers to self-fund their benefit plan by assuming the first layer of healthcare risks, and purchasing medical stop-loss coverage to cover any single large loss or aggregate loss that exceeds 125% of expected losses. A medical stop-loss group captive insurer absorbs claims above the self-funded layer. Participants can determine the appropriate level of risk retention, offer a customized benefits plan and tailor a health risk management program. Employer participants use their combined purchasing power to leverage discounts from service providers such as stop-loss carriers, third-party administrators (TPAs), provider networks and population health risk management vendors. We provide a portfolio of risk management initiatives and wellness programs to help foster a culture of wellness and healthy living, and ultimately reduce costs for both employers and employees.

Benefits of an employee benefit captive.

• Gain greater control and flexibility over benefit design plan
• Enjoy exemption from complying with state mandates for healthcare benefits
• Improve cash flow, because claims are paid when they arise instead of paying for insurance in advance
• Pay less in insurance premium taxes and operational expenses because the employer buys less in insurance
• Realize opportunity for profit — any captive insurance company surpluses are distributed to program participants

Companies that are financially strong, are prepared to assume risk and make an investment to reduce healthcare costs are good candidates for an employee benefits captive. The employer must be committed to a culture of health and wellness for employees and be ready to participate in incrementally progressive risk management initiatives.