The words on your renewal, in plain English.
Benefits language is unusually good at hiding the mechanism. These are the terms that decide what you actually pay — defined the way we would explain them across a table, each with what it does to your number.
Start typing to find one.
1095-C
The individual statement an applicable large employer provides about the coverage it offered.
Why it matters. There are now two routes: furnish by 31 January with an automatic 30-day extension, or use the on-request model — post a conspicuous notice by the due date, retain through 15 October, and furnish within 30 days of a request. Several states run their own mandates the federal relief does not override.
Applicable large employer (ALE)
An employer that averaged 50 or more full-time and full-time-equivalent employees in the prior calendar year, counted across a controlled group rather than per entity.
Why it matters. Crossing this line is what starts 1094-C and 1095-C reporting. It is measured on the prior year, so the obligation arrives the year after the growth.
Attachment pointalso: pooling point
The dollar level above which a single claim stops counting against the group’s own experience — either pooled away by the carrier on an insured plan, or picked up by stop-loss on a self-funded one.
Why it matters. Where it sits decides whether one large claim is your problem or the carrier’s. When attachment points rise, more of each large claim stays in your experience, which can move a renewal with nothing else having changed.
Authorization letter
A one-page letter that permits a carrier to release a defined set of information about your own plan to a named consultant.
Why it matters. It is not a broker of record letter. It does not change who represents you, it does not move commission, and it returns a limited information set rather than a full file. It applies to a group of any size.
Benefits administration platform
The system that holds eligibility, runs enrollment, and passes elections to carriers and payroll.
Why it matters. The platform decision usually makes a bigger decision by accident: what it can and cannot pass across an integration ends up shaping what you can offer.
Book ratealso: manual rate
The rate a carrier builds from age, location, industry classification and plan design rather than from your own claims.
Why it matters. Below full credibility, most of your renewal is this number. It is why a small employer’s increase is not a verdict on its own people.
Bracket
The size band an ancillary carrier rates you in — commonly 2–9, 10–49, 50–99 and 100+ enrolled.
Why it matters. Ancillary lines are not usually negotiated, they are bracketed: what arrives is the card rate for your bracket. Crossing a boundary produces a rate change that has nothing to do with your experience and reads exactly like a renewal action.
Broker of record letteralso: BOR letter
A letter appointing a new broker or consultant to represent you on a policy, replacing the incumbent.
Why it matters. Distinct from an authorization letter in every respect. A BOR changes representation; an authorization only releases information.
COBRA
Federal continuation coverage, generally applying to employers with 20 or more employees.
Why it matters. Runs on clocks, not on goodwill: 30 days employer to administrator, 14 days administrator to qualified beneficiary, a 60-day election window, 45 days to the first premium, and a 30-day grace period after that.
Community rating
Pricing in the small-group market set from index, age and area rather than from the group’s own claims, filed with and approved by the state before the year begins.
Why it matters. It means the price is settled before anyone negotiates. At that size the lever is which book you are in, not what anyone says at renewal.
Credibilityalso: the credibility factor
The weight a carrier gives your own claims experience against its book rate. It scales with enrolled contracts, commonly reaching full weight around 1,000 contracts.
Why it matters. It decides which explanations for your renewal are even available. At 100 contracts roughly a tenth of the number is yours, so a good result came from the market and the carrier chosen. At full credibility the renewal is your own year, priced.
Credibility charge
The cost of being blended toward the book rate when your own experience is better than the book.
Why it matters. Low credibility is not neutral. A group with genuinely good experience can be charged a substantial sum simply for being too small to be believed.
Creditable coverage (Part D)
A determination of whether your prescription drug coverage is at least as good as Medicare Part D, disclosed to Medicare-eligible individuals before 15 October each year and to CMS within 60 days of the plan year start.
Why it matters. There is no size exemption. Small employers miss this one most often.
Enrolled contracts
The number of subscribers actually enrolled — not eligible employees, and not covered members.
Why it matters. This is the unit that drives credibility and ancillary brackets. It is why headcount is how you found your size band, not what sets your rate.
Experience rating
Pricing built from the group’s own claims history, blended with the book rate according to credibility.
Why it matters. Available only once a carrier will release claims data, which generally starts around 50 enrolled contracts.
Fiduciary
Under ERISA, status attaches to whoever exercises discretion over the plan or its assets, regardless of job title.
Why it matters. You do not become a fiduciary by being appointed one. You become one by making the decisions.
Form 5500
The annual return for an ERISA plan, due the last day of the seventh month after the plan year ends, extendable by two and a half months on Form 5558.
Why it matters. The extension is not retroactive — it has to be filed before the original deadline.
FSA, limited-purpose
A flexible spending account restricted to dental and vision expenses.
Why it matters. A general-purpose FSA paired with an HSA-eligible plan disqualifies HSA contributions entirely. The limited-purpose version is the fix, and it has to be in place before the plan year, not after.
Fully insured
The carrier takes the risk and you pay a premium.
Why it matters. Your renewal is the carrier’s price for next year, built from some mix of your experience and its book, in a proportion set by credibility.
Funded
In everyday use, how a plan pays claims. Under ERISA, whether plan assets are held in a trust.
Why it matters. The two meanings collide constantly. Both a fully insured plan and a plan self-funded from general assets are “unfunded” for the Form 5500 small-plan exemption. Never read the word without checking which sense is meant.
HRA
A health reimbursement arrangement: an employer-funded account that reimburses defined medical expenses.
Why it matters. Most HRAs owe the PCORI fee, which surprises employers who think of the fee as a self-funding problem.
ICHRA
An individual coverage HRA: the employer funds an allowance and employees buy individual coverage with it.
Why it matters. It moves the plan decision to the employee. It does not remove it — and it carries a real 90-day notice deadline before the plan year.
Level funded
Self-funded up to an attachment point, with a fixed monthly payment and a reconciliation afterward.
Why it matters. It is self-funding, whatever the payment schedule feels like. The employer owes the PCORI fee and Section 105(h) testing applies.
Leveraged trend
The effect of a fixed deductible against claims that keep growing: the threshold stays put while the claims above it rise.
Why it matters. It is why a stop-loss renewal can land in the thirties when underlying claims moved ten percent and nothing unusual happened.
Mini-COBRA
A state continuation law extending COBRA-style rights to employees of employers below the federal 20-employee threshold.
Why it matters. Michigan does not have one. A Michigan employer under 20 has no continuation obligation, federal or state — which is the opposite of what most people assume.
Participationalso: take-up
The share of eligible employees who actually enroll.
Why it matters. A rate lever twice over: it drives credibility, and thin participation is separately penalized, because the people who enroll out of a thinly-participating class skew toward those who needed the coverage.
PCORI fee
A per-covered-life fee filed on Form 720 by 31 July of the year after the plan year ends.
Why it matters. Owed by the sponsor of a self-funded plan, including level-funded plans and most HRAs. Employers who think of themselves as insured are the ones who miss it.
PEO
A professional employer organization, entering a co-employment relationship with your workforce.
Why it matters. The benefits consequence is usually evaluated only as a payroll decision: in a PEO arrangement the PEO becomes the plan sponsor.
Rate exhibitalso: rate development summary
The carrier’s own working showing how it built your renewal — community rate, pooling point, credibility factor and projection.
Why it matters. The credibility factor actually applied to you is printed on it. If you have never been shown one, that is the first thing to ask for.
Reference-based pricing
Paying providers a set multiple of the Medicare rate instead of a negotiated network discount.
Why it matters. For scale: one national transparency study put private plans at 254 percent of Medicare for hospital care. Programs of this kind report averages nearer 140 percent, with the usual caveats that the findings are descriptive rather than causal.
Section 105(h) testing
Non-discrimination testing that applies to self-funded medical plans, including level-funded ones.
Why it matters. Failing it is a taxable event for highly compensated participants, not a filing problem.
Self-funded
The employer pays claims from its own assets, usually with stop-loss above an attachment point.
Why it matters. The premium equivalent stops being one number and becomes three that move on different clocks: claims, administration and stop-loss.
Stop-loss
Insurance that caps a self-funded employer’s exposure, either per claimant or in aggregate.
Why it matters. Premiums rose in the mid-teens for 2026 depending on deductible — several points faster than the year before — largely through leveraged trend.
Summary annual report (SAR)
The plain-language summary of the Form 5500, due nine months after the plan year closes, or two months after an extension ends.
Why it matters. It is a distribution obligation, not a filing one. Missing it is quiet until someone asks.
Tier relativity
The price relationships between coverage tiers — single, two-person, family and so on.
Why it matters. Restructuring these is a pricing decision that arrives dressed as trend. Three tiers up twenty-two percent and family up fifteen is not a claims outcome.
Trend
The expected year-over-year rise in medical cost, quoted either before or after plan-design changes.
Why it matters. The before-and-after distinction is the most misquoted thing in this subject. National figures for 2026 run around nine to ten percent before plan changes and roughly six and a half to seven and a half after.
Nothing matches that. Try a shorter word, or ask us directly.
If a term on your renewal is not here, send it to us.
We will tell you what it means and, more usefully, whether it is doing anything to your price.
Send us your renewal.
We’ll tell you whether it looks competitive, where we see opportunity, and the five questions we’d put to your carrier. No cost, and no obligation to move anything.
The renewal letter
Your current plan summary
Contribution split by tier
Enrolled counts by tier
Four documents — two more if your group is 50 or more. Nothing else; every extra one is a reason to postpone.
An independent employee benefits consulting firm. We look at the entire benefits program — cost, plan performance, risk and administration.
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