Take the Fear out of
Self-Funding
Many qualified sales and account teams avoid discussions about self-funding with their fully insured clients and prospects. In most cases, this avoidance stems from fear. Concerns about implementation failures or the possibility of high claims in the first year can be daunting. However, self-funding isn’t as intimidating as it seems. Thousands of employers transition to self-funding or level-funding every year, motivated by increasing premium costs and a lack of control over plan design.
With the right partners, implementations can be successful. Third-party administrators (TPAs) and subject matter experts (SMEs) are available to help and are invested in your success. Additionally, financial concerns—such as fears of claims spiking in the first year—are mitigated by taking a long-term view. Our models show that at least 95% of employers will financially benefit from self-funding within any rolling five-year period.
If you're helping a client or prospect transition to self-funding, actuarial and underwriting tools can simplify the decision-making process. Your company may already have these tools or SMEs available, and if not, we’ll explore ways to access them later in this newsletter.
Once a plan sponsor has decided to move to self-funding, several critical steps must be taken to ensure a smooth implementation. Below is a checklist of essential tasks for both brokers and clients.
Broker To-Dos
Bonus Tip for Brokers: Keep clients engaged with a Year-One Savings Replay showing actual spending vs. fully insured costs and total savings in Year 1.
Client To-Dos
Bonus Tip for Plan Sponsors: A smooth transition requires coordination between:
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Stop-Loss Carrier (for large claims protection)
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TPA (for claims administration)
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Bank/Finance Team (for claims funding)
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HR (for payroll adjustments, COBRA, and employee communications)
Tools for Self-Funding Success
Once you introduce self-funding, our Self-Funding Feasibility Tool helps you go deeper. This actuarial modeling tool evaluates a group’s claims history and risk profile, presenting best-case, worst-case, and expected cost scenarios—making leadership buy-in easier.
Plan Studio streamlines performance tracking and plan design modeling. Brokers can analyze self-funded scenarios, compare options, and perform rate calculations, empowering plan sponsors with data-driven decision-making.
These tools simplify:
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Cost Projections: Compare self-funded vs. fully insured costs.
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Risk Assessment: Model catastrophic claims and evaluate stop-loss needs.
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Strategic Decision-Making: Use hard data for renewal and plan options.
The result? Faster transitions, fewer surprises, and smarter financial outcomes.
Ready to simplify self-funding transitions for your clients? Book a demo or explore our self-service plans today.
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