Highlights
- A medical captive as part of a self-funding arrangement is a non-traditional health insurance approach that benefits advisors and their clients.
- Advising companies in a medical captive can help you deepen relationships with clients and set you apart as a leader in the insurance advising industry.
- As a medical captive advisor, you can help your clients find customized healthcare solutions and save money on their plans.
- By educating clients on the advantages of a medical captive plan, you can help create a better life for all with improved access to tailored benefits and high-level care.
Any benefits advisor looking to grow their book of business needs to adopt out-of-the-box solutions to meet changing healthcare needs. Medical captives are a modern take on health insurance.
A medical captive arrangement enables businesses to address the high costs of national healthcare expenditures, which amount to $4.4 trillion, by shifting from restrictive fully funded plans to self-funding with a medical captive.
These plans benefit companies and their advisors. For clients, the advantage is a plan that helps them save money and meet the unique needs of their employees.
This approach emphasizes cost containment in healthcare and promotes healthcare price transparency, which are critical in today’s market. Medical cost management becomes more accessible, leading to better healthcare cost control.
For advisors, medical captives allow for stronger relationships, more personalized service offerings, and greater client retention.
Keep reading to learn the top benefits of group medical captives for advisors and how you can grow your book of business with Roundstone’s group captive insurance.
The Advisor’s Advantage
If you’re considering brokering group captive vs. traditional health insurance plans, you’re likely curious about the benefits of this client-forward solution. Self-funded insurance provides advisors with strategic advantages over a fully funded options, including the following:
- Offer custom solutions. Medical captives typically allow more custom solutions to address each client’s health and financial needs. This ensures relevant and effective solutions, leading to better financial health and coverage satisfaction among clients and their employees. It shows that you’re not just selling a product but providing a service that adapts to their specific circumstances, incorporating effective cost containment measures.
- Improve client retention. By focusing on personalized service and understanding individual client needs, you’ll deepen trust and rapport with your clients — leading to stronger, lasting relationships. Clients are more likely to stay with an advisor who is committed to their needs and understands their challenges and goals.
- Stand out in the market. Offering stop-loss coverage showcases your expertise in providing specialized and impactful solutions. Your approach to healthcare cost control will make you a preferred advisor in the market. These plans often become essential to your clients, making it challenging for competitors to present viable alternatives.
- Establish yourself as a leader. By adopting innovative solutions like captive that better address the changing demands of your client base, you establish yourself as a thought leader in the advisory space. This reputation attracts clients seeking proactive and creative solutions, helping you expand your book of business.
Key Selling Points for Clients: Healthcare Cost Transparency, Risk Management, and Premium Distributions
To get started in group captive insurance advising, get to know the key selling points for potential clients. These plans work best for small to midsize companies with between 25 and 1,000 employees and offer the following benefits to your clients:
- Cost savings. Group captives provide healthcare cost transparency, which allows clients to proactively lower their insurance costs. With the help of Roundstone advisors and a customized CSI Dashboard, companies can implement cost-containment strategies throughout the year. This can include wellness programs, primary care incentives, and pharmacy benefit management to save 20% annually compared to fully insured plans.
- Improved risk management. Group captives in a self-funded solution provide boosted risk management by pooling claims and using stop-loss insurance to protect against high-cost claims. This levels out the financial risks associated with large claims.For example, if a member company encounters a catastrophic claim, the pooled resources and stop-loss coverage will minimize the impact, mitigating unmanageable costs.
- Profit sharing potential. In group captives, unused premiums are returned to member companies, offering a financial return. This profit-sharing aspect turns healthcare expenses into potential profits.For example, with Roundstone, your client can receive a cash distribution of 100% of their unused claims fund at the end of the year. We also guarantee that if they don’t see savings over five years, we’ll make up the difference. In fact, we recently distributed $12.4 million to our medical captive participants.
Marketing and Client Education
To successfully market group captive insurance and educate clients, you must highlight the tangible benefits and address common concerns. Start by assessing “Is a group captive right for my client?” If you think they’d be a good fit for the plan, use the following strategies to educate them on the benefits of switching:
- Use clear, concise language. Avoid industry jargon when explaining medical captives. Focus on straightforward language — for instance, instead of saying “risk pooling and stop-loss insurance,” say “sharing healthcare costs with other companies to avoid big, unexpected bills.” Plain language makes it easier for clients to understand the value of medical captives and how they work and emphasizes your commitment to health plan transparency.
- Create visual aids. Develop infographics, charts, and comparison tables to visually demonstrate how medical captives work and their benefits. Visual aids can make complex data more accessible and engaging for clients. One of the Roundstone benefits for advisors is that we provide resources like a welcome toolkit and marketing support to help.
- Highlight proven savings. Use concrete data to illustrate potential savings. For example, Roundstone’s clients save on average $675 per member per month compared to fully insured plans, translating into significant annual savings. You can also share that since 2003, Roundstone has returned $72 million in distributions to customers.
- Share case studies. Use real-life examples of employers who have benefited from joining a medical captive such as United Food Bank, A New Day recovery center, and even Roundstone ourselves. Detail initial challenges, implemented solutions, and achieved outcomes. This storytelling approach makes the concept relatable and credible to your clients.
- Co-host workshops and webinars. Conduct interactive sessions with Roundstone where potential clients can learn about medical captives, ask questions, and hear from industry experts. These events can help demystify the concept and build confidence.
- Regular updates. Keep clients informed with regular updates on industry trends, regulatory changes, and new cost containment strategies. Consistent communication helps maintain engagement and reinforces your role as a trusted advisor.
- Personalized consultations. Offer one-on-one consultations to address specific client needs and concerns, including Roundstone when you need an assist.Tailor your approach to client scenarios ensures a deeper understanding and stronger relationship. For instance, if your client is struggling with the 15.2% rise in pharmacy costs, you can introduce a pass-through or transparent Pharmacy Benefits Manager to reduce expenses.
Grow Your Book of Business With Roundstone
Roundstone offers a proven pathway for advisors to grow their book of business while helping clients achieve significant cost savings and improved benefits. Emphasizing Roundstone’s approach to healthcare price transparency, and healthcare cost controllwill help you demonstrate the value of your services.
With our support, you can confidently guide clients through the transition to self-funding with medical captives, ensuring they reap the benefits of lower costs, better risk management, and potential profit sharing.
Join the ranks of forward-thinking advisors who are transforming the health insurance landscape. Contact us today and start your journey with Roundstone — helping your clients achieve better benefits at a lower cost while expanding your business with innovative, client-centric solutions.
