Medical Stop-Loss Insurance: Definition, Types, and Benefits

Medical stop-loss insurance reimburses an employer (self-funded plan) for claims exceeding a predefined threshold (attachment point). It caps financial exposure from catastrophic claims.

Types

• Specific stop-loss: Covers individual claims above a set dollar amount.
• Aggregate stop-loss: Covers total group claims exceeding an aggregate limit.
• Excess stop-loss: Hybrid covering both per-person and aggregate excess.

Benefits

• Budget predictability for self-funded plans.
• Protection against high-cost claimants.
• Essential for smaller employers lacking large risk pools.

Considerations

Attachment point, coverage limits, premiums, and contract terms vary; consult a stop-loss specialist or broker.