In Our Clients' Words...

MagnaFund: SGSF Pricing

Our proprietary Risk Analytic Engine™ (RAE) applies rigorous stochastic modeling techniques to the statistical uncertainties of Small Group health insurance.   The RAE enables us to properly assess the required claims account contributions, stop loss premiums, and administration fees for any combination of benefit plans, stop loss programs, and surplus refund policy desired by the client.  The RAE can also be used to provide the “odds” that SGSF will save money for a group and make money for the carrier.

The pricing takes into account the important characteristics that drive differences in expected costs between groups:

  • Benefit plans
  • Stop loss program
  • Member demographics and morbidity (based on assessments using KAT tools)
  • Group size
  • Local network pricing
  • Surplus refund policy

The stop loss coverage can be specific only, aggregate only, or specific and aggregate.  It can be unlimited 100% reimbursement or apply coinsurance and reimbursement limits.  The pricing will take into account any XOL protection the carrier has purchased.

Our pricing modules provide considerable flexibility in product design.   The client can specify rules limiting how many benefit plans a group may offer, defining allowable product combinations, and managing relative pricing levels between plans. 

We can set rates on a composite or step-rated basis, net of commissions or with commissions, and under any of the traditional group tier structures.

The MagnaFund solution incorporates rating algorithms to address all the quoting situations a carrier will face:

  • Illustrative or final quotes for new prospects
  • Quotes for current fully insured customers interested in obtaining SGSF coverage
  • Quotes for rewriting current SGSF customers at the end of their current plan year