Understanding Risk
“Risk” is a very important word to consider when making decisions. Whether deciding how to get to work or what option is best for investment, knowing what can happen is a big influence in what choice is made. That’s why it is an important philosophy at PTSIG and CHSI companies to educate our future and existing members on what risk means in a self-insured group.
Our self-insured group (SIG) members’ first-line of defense is the group itself. Similar to the phrase “There’s safety in numbers,” each self-insured group has programs specifically designed for their industry, a careful membership selection process, and insurance claims cost control to safely distribute risk over a larger area. This distribution of risk in turn provides more protection for the individual. With the right foundation, the SIG has the ability to manage and prevent risk before it happens.
Catastrophic Claims:
CHSI manages catastrophic claims similar to most non-group providers. Our members are covered by different layers of protection that ensure a more financially manageable situation. They are completely protected against all claims arising from an occurrence, whether it is one fatality or fifty. Once the group’s insurance coverage meets the premium for an occurrence, our excess insurance provider covers the remaining cost for the life of the claim. Excess insurance with A+ carriers means that members never have to worry about disasters.
Example: A CHSI managed program experienced a fatality in 2002. The cost was easily absorbed by the group and members continued to receive dividends for that year.
Special Assessments:
At CHSI, our team of professionals design and manage groups so that they are able to absorb unexpected costs through the building of surplus funds and purchasing of excess insurance coverage. Our trained professionals in underwriting, SIG design, and risk-management have successfully developed ways to safely spread the risk among the group to create a more stable environment. In turn, there have been no special assessments of an entire SIG in the 11 year history of CHSI managed programs. However, in the extraordinary case where the group experiences unexpectedly high claims costs, members could be asked to add additional funds to the pool on a proportionate basis to bring surpluses up to desired levels.
Example: A SIG needs to add $100,000 to its pool. A single member who annually pays 2% of the total pool would then have to contribute an additional 2% of this special assessment, or $2,000.
