What to measure
Evidence before assumptions.
- Specific deductible fit
- Maximum plan liability
- Contract basis
- Reimbursement performance
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Component 05
Stop-Loss & Catastrophic Risk
Are we protecting the plan against catastrophic claims without unnecessarily transferring dollars to an insurer?
Clear definition
Stop-loss and catastrophic risk strategy treats coverage as a financial instrument within the employer’s broader risk-management approach, with attention to contract terms and maximum liability.
Common mistakes
What weakens performance.
- Renewing stop-loss without comparing contract terms
- Overlooking lasers, exclusions and rate caps
- Separating stop-loss decisions from the funding strategy
High-performance practices
Build a deliberate approach.
01
Model expected and adverse claim exposure
02
Review exclusions, lasers, renewal protection and contract basis
03
Coordinate coverage with reserve and captive strategy
Book connection
Chapters 14–16: Protecting catastrophic risk
Chapters 14–16
The catastrophic-risk chapters position stop-loss within a broader financing and reserve strategy.
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Stop-Loss & Catastrophic Risk
Are specific deductibles, contract terms and maximum liability being tested against real claim exposure?
A lower score indicates the plan should model adverse scenarios and scrutinize contract provisions before placement.
Take the Health Plan ScoreEmployer Benefits IQ resource
Stop-Loss Contract Review Guide
A printable Employer Benefits IQ worksheet for defining the decision, evidence, accountable owner and review cadence.
Author perspective
By Corry Hull, REBC, CSFS — Author, The High Performance Health Plan and Founder, Employer Benefits IQ.
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