How does Carrier Solutions Risk Retention Group protect itself from catastrophic claims?
A7. CS RRG issues a contractual liability policy that covers both specific and aggregate claims which caps the liability each plan sponsor faces when it chooses to self fund its employee health benefit plan. CS RRG retains only a portion of the total risk and reinsures itself by purchasing both specific and aggregate coverage from a commercial reinsurer. As CS RRGs surpluses grow it will assume more and more of the total risk and pay less and less in reinsurance costs. This will have the long term effect of retaining the maximum amount of funds available to pay for the care of the member companies of CS RRG self funded health plan participants.
Related Questions
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