Aggregate Stop-Loss Insurance

AAA

DEFINITION of 'Aggregate Stop-Loss Insurance'

A policy designed to limit claim coverage (losses) to a specific amount. This type of coverage is to ensure that catastrophic claims (specific stop-loss) or numerous claims (aggregate stop-loss), do not upset the financial reserves of a self-funded plan. Aggregate stop-loss protects the employer against higher-than-expected claims. If total claims exceed the aggregate limit, the stop-loss insurance carrier reimburses the employer.


INVESTOPEDIA EXPLAINS 'Aggregate Stop-Loss Insurance'

A self-funded plan is one in which the employer assumes the financial risk for providing healthcare benefits to its employees. In practical terms, self-funded employers pay for each claim as it is presented instead of paying a fixed premium to an insurance carrier for a fully insured plan. Stop-loss insurance is similar to purchasing high-deductible insurance. The employer remains responsible for claims expense under the deductible amount.

RELATED TERMS
  1. Commissioners Standard Industrial ...

    A mathematical table used by actuaries to calculate the nonforfeiture ...
  2. Aggregate Product Liability Limit ...

    The maximum sum of money that an insurance company will pay during ...
  3. Reinsurance

    The practice of insurers transferring portions of risk portfolios ...
  4. Deductible

    1. The amount you have to pay out-of-pocket for expenses before ...
  5. Co-Insurance

    A co-sharing agreement between the insured and the insurer under ...
  6. High-Deductible Health Plan - HDHP

    A health insurance plan that has a high minimum deductible, which ...
Related Articles
  1. Home & Auto

    The History Of Insurance

    The first written policy appeared in Hammurabi's Code. Find out how it evolved from there.
  2. Home & Auto

    How An Insurance Company Determines Your Premiums

    Find out how insurers use credit history to build an insurance score and how it could affect your bottom line.
  3. Insurance

    15 Insurance Policies You Don't Need

    Learn how to save money by saying "no" to unnecessary coverage.
  4. Entrepreneurship

    Will Insurance Keep Your Business Safe?

    Skilled employees are key to a successful business. Find out how to avoid a financial setback if they leave.
  5. Home & Auto

    Long-Term Care Insurance: Who Needs It?

    No one is immune to the possibility of one day needing long-term care - and the costs can deplete a life savings.
  6. Insurance

    Life Insurance: Putting A Price On Peace Of Mind

    Would your death leave loved ones financially stranded? Find out how to ease your mind and keep them protected.
  7. Insurance

    Find Secure And Affordable Post-Work Health Insurance

    Learn how you can avoid financial catastrophe - without Medicare.
  8. Options & Futures

    How To Choose A Healthcare Plan

    HMOs? PPOs? CDHPs? We'll clear up the confusion so you can find the right coverage.
  9. Insurance

    Who are the best-rated life insurance companies in the US?

    Learn about what makes an insurance company the best. Read about the best life insurance companies in the U.S. in 2014, following ratings by Weis.
  10. Insurance

    What are some examples of when insurance bundling is a bad idea?

    Learn about situations where insurance bundling may not be a favorable option. Bundling insurance is often a good idea, but there are times when it isn't.

You May Also Like

Hot Definitions
  1. Santa Claus Rally

    A surge in the price of stocks that often occurs in the week between Christmas and New Year's Day. There are numerous explanations ...
  2. Commodity

    1. A basic good used in commerce that is interchangeable with other commodities of the same type. Commodities are most often ...
  3. Deferred Revenue

    Advance payments or unearned revenue, recorded on the recipient's balance sheet as a liability, until the services have been ...
  4. Multinational Corporation - MNC

    A corporation that has its facilities and other assets in at least one country other than its home country. Such companies ...
  5. SWOT Analysis

    A tool that identifies the strengths, weaknesses, opportunities and threats of an organization. Specifically, SWOT is a basic, ...
  6. Simple Interest

    A quick method of calculating the interest charge on a loan. Simple interest is determined by multiplying the interest rate ...
Trading Center