Risk Strategies Company
Risk Strategies Company


Credit Union Insurance - Risk Strategies Company


Does self-funding medical insurance create cost volatility compared to buying traditional medical insurance?

Not if the program is structured correctly. Self-funding your medical insurance doesn’t mean that your Credit Union is responsible for all claims no matter what size. Under the CUHB model we help employers determine the amount of risk that is appropriate for their company and we structure a stop-loss insurance program to protect against excess frequency of small claims or catastrophic claims. With traditional medical insurance there is a 100% chance that your rates will increase most every year. Under a self-funded program, the transparency and control you gain can result in cost control even cost reduction.

Do we need a minimum amount of employees to consider this program?

Generally speaking the minimum employer group size eligible for the CUHB program is somewhere around 85-100. Smaller groups may have less claim credibility and be subject to more volatility.

Will this program increase the workload of our HR staff?

No. Transitioning to the CUHB plan is seamless and the installation process is similar to what you have experienced during open enrollment for a new medical insurance carrier. Prior to implementing the program we work with all levels of executive management to make sure everyone understands how the financial model works.

Will we need to provide additional employee education?

If there is a change in plan structure or provider network we would work with your staff at open enrollment to educate employees on issues such as co-pays, deductibles, and in and out of network differences. Our experience has been because we can use the majority of the nation’s provider networks (Cigna, Blue Shield, and regional networks) most employees maintain their current provider relationships.

What happens if our Credit Union has a bad claim year?

Each Credit Union is individually underwritten and premiums are based on an expected loss projection which is developed from several years of underwriting information. One bad year doesn’t make a bad account. Because we have transparency of information within the program if a Credit Union has a bad year we are able to determine what occurred and take corrective actions to mitigate adverse experience which reduces cost volatility from year to year.

Does the CUHB partially self-funded model work for all Credit Unions?

The CUHB model works for Credit Unions that are willing to be actively involved in their medical programs. This means having access to medical and RX claims data (transparency), using this actionable data for conducting engagement and outreach to high-risk employees to help them better manage their health, and incentivizing employees to improve/maintain their health.

What is a group captive insurance company, and what is the financial risk of this arrangement as compared to using a traditional medical insurance company?

A group captive is an insurance company formed by a group of companies (in this case Credit Unions) who join together to reduce the cost of insurance. Participants must be willing to be actively involved in their medical programs, and to implement effective risk management programs. There is no more financial risk to this arrangement as compared to traditional medical insurance as insurance company backing the program guarantees the payment of losses. The insurance company used for the CUHB program is rated “A, Excellent” by A. M. Best and operates on an admitted basis in all 50 states.

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