Alternative Risk...

Large Deductible


Large deductible insurance programs can be successful for an employer who doesn't want to self-insure, but wants the same advantages of self-insurance.  The employer purchases an insurance policy, at a discounted rate, with an agreed upon deductible.  All claims within the deductible are paid by the employer.  When a claim exceeds the deductible, the insurance carrier pays the remainder.  The key to a successful deductible program is the same as that of self-insurance - quality claims management.   Hewitt Coleman has been approved by, and handles claims for, several insurance carriers writing large deductible programs.

As a rule, large deductible programs are appropriate for companies who desire to exercise control over the claims management process while achieving improved cash flow and minimizing fixed costs.  Generally, employers who have the financial resources to assume the risk of self-insurance but have exposure in numerous state jurisdictions should consider a large deductible option.

Advantages:

• Does not require state regulatory approval
• Policy can be written to cover multiple states
• Unbundled claim services offers maximum flexibility and control
• Specific (per occurrence) and aggregate (total exposure) deductible options can be selected.
• Cash flow benefits associated with self-insured programs. 
• Collateral to secure claim liabilities is pledged to the single insurance carrier rather than multiple state agencies.
• Reduced fixed costs as the predetermined risk level is increased.