Insurance is often one of the most significant expenditures in a company’s budget. If this is true for your business, managing the costs while maintaining the best coverage can be a considerable challenge. A self-insurance plan offers an innovative solution to this problem by allowing employers to fund their own coverage. More importantly, it gives companies greater autonomy over their insurance options.
Learn All About A Self-Insurance Plan
Read on to find out what to know about self-insurance plans.
Self-Insurance Offers Freedom
There are many reasons a company may opt for a self-insurance plan, but one of the most significant benefits is the freedom it offers to enrollees. Indeed, a company that invests in this type of insurance will be able to choose its benefits, stabilize expenses, and serve employees more effectively. The savings of a self-insurance plan can provide budgetary freedom for businesses and grant a greater awareness of liabilities. To run an effective program, businesses must proactively analyze and confront the most pressing liabilities affecting the company.
Self-Insurance Is More Flexible
In addition to greater freedom, a self-insurance plan can provide companies with greater flexibility. It is because companies can pay out claims only as they arise, thus offering more financial flexibility. Companies set up this coverage by estimating the anticipated cost of claims for the year and allocating this sum to an account. Claims are then paid out from the account throughout the year. If the cost of claims exceeds the anticipated amount, a stop-loss captive solution offers financial protection. Stop-loss coverage may allow for reimbursement in this scenario.
Self-Insurance Can Minimize Costs
Yet another significant advantage of this insurance option is its ability to minimize your company’s costs. Self-insuring your company can save money because it allows you to recoup the remaining funds after paying out claims. If you allocate $150,000 for claims, you will have a balance of $50,000 left over if you only received $100,000 in claims. Your company typically shares any leftover balance with the insurer that manages claims.
Self-Insurance Streamlines Administration
If managing your company’s insurance operations sounds daunting, don’t worry — you don’t have to do everything. When you decide to self-insure your company, you assume responsibility for the financial aspect of claims and payments while an insurer handles the administration of claims. It allows you to streamline the process while reaping the monetary benefits of funding your company’s coverage.
Self-Insurance Policies Benefit Employees
Self-insurance is more than just advantageous for your business. It’s also beneficial for your employees. When insurance is less expensive, employees can enjoy better coverage. They can also exercise greater control over the available insurance options and advocate for the benefits they want. Partner with an experienced provider to handle the administrative side of your company’s coverage and see why self-insuring your business is the best bet.
About Haughn & Associates
Founded by Michael Haughn in 1986, Haughn & Associates is a full-service, family-owned, independent insurance agency based out of Dublin, Ohio. H&A strives to provide the best possible price and unique insurance solutions across a myriad of industries, including construction, IT, Habitation & Commercial Property, Agriculture, and Engineering. Devoted to providing the best of business insurance, life and disability insurance, personal insurance, employee benefits, and bonds, H&A is proof that success lies in long-standing client relations and satisfaction. To learn more about how H&A can be of service to you, contact us at (877) 802-2278.
