We are a Canadian Financial services organization specializing in advanced tax sheltering, wealth accumulation planning, business succession, and retirement planning. We have also been very successful in reducing costs of employee programs and providing more tax effective compensation.
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We are a Canadian Financial services organization specializing in advanced tax sheltering, wealth accumulation planning, business succession, and retirement planning.
Financial, RRSP, Mutual Fund, Estate Planning, IPP, RRIF, Employee Benefits, Life Insurance, Universal Life, Tax Shelter, Living Buyout, Financial Planning, Retirement Planning, Shared Ownership, Pension, Trusts, Offshore, Shareholder Agreements, Accident and Sickness Insurance, Group Insurance, Canadians Can Now Purchase an Affordable US Health Care Plan
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An Overview of Consulting Services
HFI Benefits Inc. is dedicated to putting you, our client, first. We take a personal interest in your success. Our business is serving you and that means putting our creativity to work to minimize your corporate risk. It’s what we thrive on.
We take time to get to know you and your business review your objectives and financial needs. We ask questions, lots of them, so that we can assess your unique requirements, help you determine your risks and provide the expert guidance and insurance program that will perform best for you.
Over the years, HFI Benefits Inc. has earned a solid reputation for providing insurance solutions at affordable rates with the highest standards of personalized customer service. We take that reputation very seriously.
Our reputation also extends to our own industry. We have chosen to work in partnership with only a select group of responsible, financially stable insurers whose goals and objectives are similar to our own. Over the years, they have earned our respect and have entrusted us to perform many services for you which most firms are not authorized to perform. That’s an advantage to you, the client.
Our promise to you is to provide exceptional service and the coverage that meets your unique needs. Our promise to ourselves is to earn your trust and your business.
Value Added Services
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Financial Planning·
Employee Benefits·
Retirement Planning·
Registered Pension Plans·
Tax Strategies·
Group RRSP’s·
Estate Planning·
Executive Compensation·
Investment Analysis·
Seminars·
Insurance AnalysisWhen it comes to group benefits HFI Benefits Inc. is a unique consulting organization and resource. The company is known for highly specialized financial strategies and products designed to respond to the complex needs of the business and professional community through our Associates.
In the belief that insurance professionals are the key to providing value added services for consumers, the company was aligned to offer a collective strength with other national associates by negotiating with carriers on our joint behalf and providing extensive support services and professional development training to enhance our competitiveness in the marketplace. Over the years, HFI Benefits Inc. has supported the development of consumer-responsive insurance products designed to meet the needs of our corporate clients.
Our organization has been structured so that the Employee Benefits Division is 100% focused on Employee Benefits. (Employee Benefits represent about 35% of our total business.)
Our focus as a consulting organization is on the design, implementation and management of Employee Benefits. Employee Benefits is not our only business. Our network of associates have the ability to provide local service across Canada and the structure of our organization differs from a number of other consulting firms.
Our structure defines the roles of each team member and our integrated training process supports a fully backed-up delivery system to ensure superior services levels to our clients. Our Marketing and Service Consultants are interchangeable. The proficiency of our in-house support staff is key to maintaining service standards – they generate a synergy designed to support your needs – your goals – your philosophies.
Our relationships with the underwriting community are first rate and our reputation is impeccable. The ‘quality’ of the information they provide will differ from what is generally available in the marketplace.
The reason we are successful in this endeavor is the structure of our organization, the expertise of our associated staffs and most importantly, our focus on the client’s needs and goals.
Additionally, we have arrangements with eight ‘preferred providers’ which allow us to develop the pricing strategies on behalf of the insurance carrier. This is a testament to recognition of our expertise in the area of Employee Benefits.
The HFI Benefits Inc. organizational structure provides us with access to expertise in the area of personal disability and life products. Our ‘retention’ rate with respect to our clients is 99% or better. Once we have a client, we keep the client.
The world-wide recession of the nineties, combined with ballooning health costs and a de-listing of publicly funded health services, has put a critical new emphasis on the importance of professionally managed group health and disability benefits. Group benefit plans require highly sophisticated program planning, implementation and ongoing service to ensure clients receive the plan which is the most attractive and best suited to our employees.
HFI Benefits Inc.’s national reputation and rapport with major group benefits insurance carriers enables us to arrange excellent rates and coverage features. Our Group Benefits Services provide our Associates with the best possible management, technical and marketing support to ensure the highest caliber of program delivery and value-added service for clients. We have the expertise, marketing support, information systems and the management consulting back up our Associates need to capture and retain business.
HFI Benefits Inc.’s Group Benefits Services include:
Program Design
Review of a client’s current group coverage to determine our needs and wants, and tailor the plan best suited to them
Implementation
Development and implementation of a group benefit strategy, which will fulfill, and usually exceed, client expectations.
Ongoing Management
Tracking, monitoring and analysis of the plan to ensure that it continues to do the job it was designed to do
Assessments of existing employee benefit program to show how they compare with what’s being offered by other employers
Practical recommendations on ways to control claims costs while keeping employees satisfied with our coverage
Monitoring of market influences and new legislation affecting benefits insurance
Helping to educate clients on how our employees can access and use our benefit program
Design
We see our role as facilitating the design, implementation and on-going management of Employee Benefit programs. The following is a synopsis of the types of information and material we provide to support management of the Employee Benefit Program.
We specialize in customizing benefit plans that are cost-effective and responsive to the needs of our clients. We are proud of our information network and feel that it is this type of material that supports our goal of providing "value-added" services.
Costs relative to Employee Benefit programs are escalating and healthcare inflation has been ranging from 14% to 24% over the past few years. We feel that the plan can be "managed" with the appropriate design features that help to control claims while supporting a comprehensive program for the employee.
The following material is intended to illustrate the different processes inherent to management of the Employee Benefit plan and to provide an overview of how these various operations are handled.
Process of Recommendations
- Evaluation of current funding arrangements
- Evaluation of current plan design and future requirements used on the corporate philosophy and goals
- Evaluation of current administration and claims adjudication systems
Implementation
Implementation and administration of Employee Benefits does not differ from the process followed for full time staff. There may be a greater need for flexibility in terms of design and eligibility; however, these are issues that are dealt with before design to ensure that the client’s corporate needs and goals are being met. Cost sharing – eligibility – plan design and corporate objectives will dictate the process to a large degree.
On-Going Management – Financial
Our reports vary according to plan design and according to the underwriter and the information made available for analysis. Some examples are:
Quarterly Experience Reviews
This report typically details the ratio of premiums to claims from renewal date relative to each quarter of the policy year. The report includes graph depictions of the information and may include comparative illustrations from the prior year in order to measure any change in trend. The review which, is based on the experience period from which the carrier will develop the renewal rate basis will typically include projections of what our client might expect to see with the renewal proposal from the carrier.
If experience results seem excessive or aberrant compared to historical information, detailed claims may be ordered so that an analysis of the claim components can be completed. We try to determine what is driving the claims in order to proact to potential problem areas. Component information may be detailed in a table or pie graph.
These reports are delivered each quarter and are combined with a meeting with your designate(s) to review the information and discuss results.
Renewal Evaluation
On receipt of the renewal proposal from the carrier, we complete our comparative calculations based on our own formulas and initiate negotiations with the underwriter where appropriate. Our renewal analysis is quite in-depth and details how rates are developed and the underwriting philosophies applicable to such development so that your staff understands the process. We provide an overview of the current plan design for reference and develop commentary relative to each benefit to detail exactly what has occurred over the year.
The renewal evaluation will include pie and bar graphs to help visualize comparative information regarding claims experience and will incorporate demographic comparisons to reinforce development of pricing. Claim component information and ‘average’ claims information as it relates to normative data is provided where available.
On-Going Management – Financial
(continued)The report will also typically include plan design suggestions predicated on performance of the plan as well as trends in the marketplace. We expect to be able to deliver the report at least 30 days prior to renewal and if the carrier is late in providing the details, we typically negotiate a delayed implementation. Ideally we like to get a copy of the report to our clients prior to our meeting so that all parties are prepared for the meeting with issues and questions. The renewal meeting will take 1-3 hours, depending on the complexity of the plan and position of the carrier.
Financial Report
On receipt of the financial report based on the Letter of Financial Agreement, we calculate all the expense areas in accordance with the agreement to confirm that the information is correct. The Financial Report will include the 12-month claims history and detail the expenses and final accounting. This report is prepared within 90 days of renewal. Some carriers include the accounting with renewal so timing is predicated on the carrier’s process.
The report is delivered to the client for review and the meeting can range from 1 to 3 hours, depending on the complexity of the Financial Letter of Agreement.
Employee Communication
Where appropriate we will develop communication for the employees to increase the awareness of the plan and associated costs. We will include information relative to escalating costs and experience together with suggestions to encourage the employees to participate in management of the plan.
Where plan design changes are being considered, if it is appropriate, we will conduct employee surveys to measure the employee’s understanding of the plan and costs.
Such surveys are designed to give the employee the opportunity to provide input with respect to cost containment suggestions and to ascertain which design components are most important to them. This type of survey is a must if you are considering Flexible Benefits and can be valuable in many other circumstances.
Once the survey has been evaluated a report is prepared for our client and in many cases, the report is redesigned in order to ensure that the employee’s receive appropriate feedback to our input.
We create a variety of communication pieces relative to drugs and dental to enhance the employee’s understanding of these expenses. Generic versus Brand Name Drugs – Dental recall examinations – Tax Effective Cost Sharing, etcetera. These communication pieces are developed based on client needs, which are often based on actual results.
On-Going Management - Services
In the business of consulting, it is the client who relies on the expertise of the individuals who have specialized in the business area. Our expertise if, of course, in the area of Employee Benefits. We pride ourselves on our ability to simplify the process of plan design development, implementation, and management.
Every meeting we have with our client is designed to enhance our understanding of Employee Benefits. It is very important the client understand the methodology and philosophies inherent to each of these processes. Our approach and explanation is somewhat simplified, and is designed to take a complex matter and make it easy to understand. The more we educate our client, the easier our job and the greater the satisfaction level of the client. Each step is intended to meld with the client’s corporate objectives and goals.
Every client meeting is in fact a training session. It is important that those staff designated by our clients as responsible for the Employee Benefit program understand the plan and development of the applicable rate basis. The myriad of factors that impact costs – age, gender, interest rates, volumes, experience, etcetera must form an integral part of the designates education. In addition, market trends, comparisons of normative data, aberrant claim information are areas that your staff must understand and appreciate when examining Employee Benefits.
We integrate our services with the services offered by the various carriers to ensure effective training relative to plan administration – claim submission and follow up – premium billing etcetera. This can be achieved with minimal client intervention using the carrier-administered option or with on-site self-administration software.
In addition, there may be opportunities for the client to interact, in real time, via computer to obtain information and to communicate via e-mail directly with the carrier(s). Our role is to integrate all of these services to ensure the most efficient use of our client’s time and energy.
HFI Benefits Inc. is involved in the on-going training of your administration staff. Some training needs can be identified during initial reviews however, other opportunities become clear with the on-going operation of the plan.
All of these training services and integration of services are provided as a matter of course on a commission basis however, they would be charged on an ‘as needs’ basis if you elect to utilize fee for service as the method of compensation.
It is not only the designated decision-makers in whom we invest time and resources. We are willing to invest in the education of the individual employee. We have a program, which has been designed for client use to provide a Summary of Benefits, which serves to provide the employee with a one-page summary to illustrate the value of the Employee Benefit plan as a form of compensation. This program includes the ability to show the employer investment in the government-sponsored plans on behalf of the employee; bonuses; vacation, etcetera so that the overall picture presented to the individual is very positive. [Note that this program is free of charge however, input of the specific information is the responsibility of the client]
Communication
Communication with respect to claim issues – rising drug/hospital/dental costs – increasing utilization and trends – how all of these fit with any proposed plan changes and/or how this information can be integrated to help staff become informed consumers to the benefit of the program and to our pocketbook. There are significant opportunities to educate staff to encourage them to become part of the solution to rising costs and we find that these can be very effective.
Some of this material is created in our resource centre and some of this material is provided by any number of carriers and service providers. Our job it to identify opportunities for education that will benefit everyone. We integrate our services with those provided by the carriers to ensure a balanced and effective strategy to serve our clients best.
We consider communication of the plan and/or any plan design changes to the employees as being a crucial step in managing the Employee Benefit programs. We will prepare communication material for presentation to the employees and run meetings with groups of employees to ensure there is a clear understanding of the material being presented. Communication with the employee need not necessarily be for a plan change only. There is a great deal of information that the employee can use if they are given access. Part of our goal is to enlist the support of the employees in helping to manage the Benefit program. Some examples of information are as follows:
Generic drugs explanation
Positive enrollment updates
Directory of drug dispensing fee charges
Wellness strategies
Changes to government sponsored programs
Corporate claims results
We will prepare communication material for presentation to the employees and conduct seminars with group of employees to ensure there is a clear understanding of the benefits program. We provide on-going employee communication, seminars and will assist you in completing an employee survey on benefits.
Experience Reporting
For each quarter of the policy year we obtain the experience results for our clients. We communicate the results to our clients as we feel it is essential that this information be reviewed. As the third quarter results come in, we frequently include suggestions for plan design changes, which may be effective, based on the experience results. As well, we will order and examine detailed claim scans 'off-renewal' in order to ascertain if there is a specific problem to which we can be proactive on.
The following includes an example of a summary we provide with the experience period relative to development of the renewal. Our goal is to provide information that will help you to prepare for the budgeting process inherent to renewal. We tailor the type and amount of information to the needs of our client. Our experience reviews include a one-on-one meeting with our client to ensure that we are on track with our concerns and needs.
Example
EXPERIENCE SUMMARY
February 1, 1998 through to March 31, 1999
BENEFIT
Paid Premium
Incurred Claims
Incurred Loss Ratio
Weekly Indemnity
$853,200
$1,148,700
134.6%
Extended Health
$3,603,600
$2,675,700
74.2%
Dental Care
$1,540,500
$1,275,300
82.7%
Total
$5,557,300
$5,099,700
85%
EXPERIENCE SUMMARY
February 1, 1997 through to March 31, 1998
BENEFIT
Paid Premium
Incurred Claims
Incurred Loss Ratio
Weekly Indemnity
$893,400
$1,502,600
168.2%
Extended Health
$3,801,200
$2,669,100
70.2%
Dental Care
$2,049,200
$1,097,600
53.5%
Total
$6,743,800
$5,269,300
78.1%
Renewal Analysis
Claims History
We include illustrations relative to the premium and claims history relative to your Employee Benefit program. From this review we can assess trends and develop approaches to resolve any corporate issues from both a design and price perspective.
We develop different formulas for the evolution of an acceptable rate basis to be incorporated into the renewal. This provides the basis for a business case to approach the underwriter to negotiate changes to the initial renewal position where required. Our goal is to ensure that the plan is not over or under funded and that the premiums will support the plan over the new policy year.
Negotiation
Once the analysis of the claiming history and trends are complete they are compared to the carrier's evaluation. We use our own evaluation to approach the carrier to negotiate changes we feel are necessitated based on your own information.
We blend the information that is client specific with what our experience tells us is happening in the marketplace. Because we are reputable and our carrier relationships are solidly founded, our ability to negotiate an equitable renewal is strong.
Recommendations
Our analysis typically includes ideas with respect to plan design and possible changes which we believe might be of interest. Some of the changes will be specific to cost containment strategies while others may relate to enhancements to keep the plan in line with the market place.
Evaluation
Our final renewal evaluation includes all of the above information. We feel that communication with respect to development of the renewal is very important and we strive to ensure that our clients have access to all relevant information.
We meet with our clients to review the Renewal Analysis and discuss the development of the renewal. We delve into any corporate concerns in an effort to ensure that all pertinent issues are covered.
Market Study
We feel it is important to test the competitiveness of pricing as compared to the rest of the underwriting community every three to five years, or more frequently if there are problems with the incumbent carrier.
We invest a lot of time and expertise in the renewal process and feel that the renewal evaluation will be a good indicator of what might be expected in the event of a Market Study. Nevertheless, initiation of a Market Study is a useful tool. Once we have concluded that a Market Study is required, the steps are as follows:
Plan Design
Specifications are developed and submitted to the underwriting community for quotation. The specifications include an exact duplicate of the current Employee Benefit program as well as any alternate design options we feel may be of value.
Administration
The quotation request includes all pertinent information relative to the on going administrative and delivery systems that must be supported by the carrier.
Underwriting and Funding
The carriers selected to participate in the Study are provided with information relative to funding arrangements, required grand-fathering of coverage in the event of change in carrier and they are asked to provide the target loss ratio and Incurred But Not Reported reserve requirements. As well, we ask for the current inflation, trend and utilization factors applicable to the experience rated lines of benefit.
Evaluation
Initially a spreadsheet is prepared to illustrate the pricing information provided by each carrier. The premiums generated by each carrier are assessed in terms of the client claims experience to ensure that any underwriting 'investment' will not negatively impact pricing at the first renewal. The spreadsheet provides comparative information relative to target loss ratios by carrier as well.
Report and Analysis
A complete report detailing the results of the Study is prepared. Typically, the two or three most competitively priced carriers as well as the incumbent are detailed in depth. Once the report is complete, we review the analysis and take any necessary steps to change carriers if appropriate and/or modify the plan design and funding arrangements.
Administration
Most carriers provide a software program to administer the Employee Benefit plan. The system allows your plan administrator to produce register cards, wallet certificates, coverage listings and billing statements locally. The employee additions, terminations and changes are up-dated locally, in real time.
This type of process ensures that you are not being over or under charged and then waiting for the carrier to make retroactive adjustments on a future statement. Some systems are tied to the carriers main frame so that your data changes occur in both the carrier's system and your own system at the same time. In addition, you can inquire on the status of claims and with respect to experience results with some carriers. Some systems require you to produce the billings and changes and submit your system information monthly.
These systems are set up based on the current enrolment and are simple to maintain. They generally require a limited amount of time and expertise to manage. Password and access protection is included so that you can limit access to information to your designated staff.
A self-administration system is provided at no cost to you and is intended to make plan administration more efficient and timely.
Employee Benefit Statements
A problem that has been identified in the marketplace is the need for on-going reinforcement of the value of the employers Employee Benefit program. There is a lot of money invested in provision of these benefits and it should be viewed as part of compensation. The employer needs to maximize the value of the plan.
Many carriers will produce what is referred to as an Employee Benefit Statement. This statement 'typically' identifies a breakdown of the claims services the employee has accessed over a defined time frame. These summaries vary by carrier and some are provided at no cost while others have a flat charge per employee.
We have a program, which will allow you to customize your statements to reflect not only the claims information by certificate, but will include salary, bonuses, and other employer-sponsored claims and benefits. This program does require input of the information by the plan administrator.
Electronic Claim Submission
CLAIM CONSIDERATIONSThe Pay Direct Drug card will support electronic claims management thus providing advantages for your firm and for the employee.
This can be carried further, with or without the Pay Direct Drug card. Many dentists participate in a process to electronically submit dental claims directly from our office to the carrier for adjudication. Typically, the employee pays for the expense up-front however, the claim processing time is dramatically reduced and the claim cheque goes to the employee's home address.
We suggest that this process is efficient for both the employee and the company. It becomes clear how important your own on-site administration fits with this type of claim process. When you have immediate access to up-date employee information you minimize, the risk that a claim would be processed for an employee who has terminated, or that a claim would be declined because coverage for a dependent has not yet been processed by the carrier.
There are a number of areas that you need to be aware of with respect to on-going administration of the Employee Benefit program. They are important because there are opportunities available which will streamline the process of managing the administrative and claim side of the program. These efficiencies will minimize the time you spend in these areas now, and in the future.
Direct claims submission by the employee
Direct claims delivery to the employee's home
Using electronic dental claim submission where applicable to eliminate paper forms and speed up claims payment
Potential of on-line access to claims and administrative information
Investigate availability of carrier paying Out-of-Canada claims direct and moving government sponsored claim process from the employee to the carrier
Self-administration of the plan may be appropriate
Pay Direct Drug Card eliminates paper claim process for drug expenses
Direct Drug Delivery service may be appropriate to minimize dispensing fee costs and ensure that maintenance drugs are dispensed with the full three-month supply
These are simply some areas open for discussion. The goal in providing this type of information is to develop a sense of the most efficient and effective methods of managing the internal administrative and claim processes.
We need to investigate the manner in which you have arranged for submission and payment of our health and dental claims. If not already in place, it may be appropriate to consider employee direct claim submission and return. This eliminates corporate intervention on an on-gong basis. You can track claims results via an Internet applicator or through standard detailed claim scans and experience reporting.
Funding Strategies
Although the plan design decisions ultimately determine the claims levels and your claims determine the amount of premium, we believe that the financial arrangements with your insurer are extremely important. It is important to leverage your purchasing power by examining Retention Accounting.
It is certainly true that no underwriter will live with claims being higher than premiums. Our concern is making sure that as plan sponsor you are guaranteed that you are paying a competitive 'cost' and that you cannot 'over-fund' the plan. Retention Accounting is an option that ensures this.
Retention Accounting
Retention is simply an alternate method of funding the Experience Rated benefits. This method allows you to participate in the financial results of the plan. The major advantage is that you cannot over-fund the plan because any over-funding that may occur is captured based on the financial agreement and returned in the form of declared 'surplus'. The surplus is used first to fund any deficit for any other experience rated benefit; and second to fund the 'Claims Fluctuation Reserve' (CFR); and third, is returned to the employer.
Retention accounting predefines the expense charges, in advance of renewal, specified by the insurer to operate the plan so that you know exactly what is being charged and why. These expenses are outlined in a Letter of Financial Agreement which is updated each renewal.
Experience-rated Benefits are Short Term Disability, Extended Health and Dental benefits. Pricing for these benefits is typically driven by your own experience, and compounded by the effects of inflation, trend and utilization. Development of required premiums is predicated on previous experience. If the plan performs better or worse than expected, the billed rates are adjusted accordingly with the next renewal. Where the plan has performed better than expected, the excess dollars are your property. Where the plan has performed worse than expected, the new rates are set at a level expected to cover future claims and any deficit is carried forward.
Each carrier defines our required 'base' level of experience-rated premium required before they will offer Retention Accounting. The range is $100,000 and over, depending on the carrier.
The following clarifies the types of factors defined in the Letter of Financial Agreement and on which the renewal is developed. We have developed an actual retention illustration based on your plan as we had the financial data to prepare as illustrated. We would be pleased to develop an illustration based on your exact premium and claims information.
Retention accounting pre-defines the expense charges made by the insurer to operate the plan in advance of renewal so that both you and the carrier know exactly what is being charged and why. These expenses are outlined in a Letter of Financial Agreement which is updated each renewal.
The following will outline a brief description of the retention provisions:
Incurred But Not Reported Reserves (IBNR)
The IBNR is a reserve set up by the insurance carrier to account for claims incurred by employees but not yet received and paid by the insurance carrier. The reserve is typically a percentage of billed premium. Each carrier defines our own percentage of premium based on claim lag studies completed on our respective block of business.
Taxes
Taxes will be charged as declared by the government. The current Federal Premium Tax is 2%. The Provincial Retail Sales Tax of 7% is charged on the monthly billing and this amount is removed from the premium paid before the retention calculation is performed Commissions.
Commissions will be based on the actual commission paid as established between the Agent of Record and the carrier.
General Administration
The general administration component of the retention is actually the charge for the maintenance of the account and is typically a percentage of premium.
Claims Administration
The claims administration of the retention includes adjudication of claims, cheque preparation and explanation of benefits.
Other Expenses
This portion of the retention agreement includes charges for printing of booklets, communication, policy amendments, experience summaries, etc.
Interest
Interest is calculated on cash flow, which includes premiums, claims paid, administration charges, commission fees and taxes. Interest is also accrued to the IBNR held at the beginning of the policy year.
Surplus/Deficit
The Surplus or Deficit for each renewal period shall be calculated as follows:
Premium
Less Incurred Claims
Less Retention Charges (General Administration, Claims Administration, pooling, etc.)
Plus Interest Credits (Debits)
= Surplus or (Deficit)
Claims Fluctuation Reserve
A Claims Fluctuation Reserve is a fund used to recover deficits incurred during periods of high claims and limits the impact of rate adjustments necessitated by unfavorable experience. It is funded from surpluses in years of satisfactory claims experience. The target level of the reserve is typically 10% or 15% of annual experience rated premium depending on the carrier. Surpluses in excess of the reserve requirement are returned to the policyholder.
The following is an illustration of the various factors relative to the retention expenses to give you an idea of the terms defined by the Letter of Financial Agreement.
| Annual Premium | $317,702 |
| Incurred Claims: | |
|
$44,260 |
|
$220,929 |
| Total Claims | $265,189 |
| General Administration (1.5% of premium) | $4,766 |
| Claims Administration | |
| Extended Health *4.5% of premium) | $1,992 |
| Dental (3.75% of premium) | $8,285 |
| Risk Charge (0.5% of premium) | $1,588 |
| Profit Charge (0.5% of premium) | $1,588 |
| Commission (estimated) | $9,300 |
| Taxes (2% of premium) | $6,354 |
| Pooling Charges (Estimated) | $3,463 |
| Total Retention Expenses | $37,336 |
| Surplus/Deficit on year’s operation (Premium-claims-Expenses) | $15,177 |
| Claims Fluctuation Reserve Requirements 15% | $47,655 |
Based on this illustration, had your group been on retention accounting, there would have been a surplus generated of $15,177. This surplus would have been transferred to the Claims Fluctuation Reserve and would have been 32% funded in the first year.
| Other Charges: | |
| Drug Card | $1.05 per DIN plus actual charge per card |
| Booklets | Charges as incurred |
| Amendments | Charges as incurred |
Call us toll-free at (866) 444-2745 with questions or comments about this web site.
Copyright © 1996-2008 HFI Benefits Inc.
Last modified: December 14, 2008