Having the carrier apply the rebate to premium.
Carrier letters state the carrier must either send the rebate or apply it to premium due by the deadline. The Department of Labor guidance indicates directing the insurer can avoid the need for a trust.
What the letters and the guidance say.
What Carrier Letters Say
Carrier letters state they are required to send the rebate to the employer or group policyholder by the deadline, or apply it to the premium due no later than that date.
Can Avoid a Trust
The Department of Labor guidance indicates that directing the insurer to apply the rebate to future participant premiums or benefit enhancements can avoid the need to set up a trust.
It Is Still a Decision
Applying the rebate to premium is a way of using it, so the same ownership, fairness and documentation questions still apply.
Three steps for the employer.
Ask the Carrier What It Needs
Find out what instruction the carrier requires, in what form, and by what date.
Meet the Deadline
Give the carrier its instruction in time for it to apply the rebate before the date stated in the letter.
Keep Confirmation
Save the carrier’s written confirmation of how and when the rebate was applied.
Three questions to settle first.
What Instruction Does the Carrier Need?
Ask the carrier for the exact form and date.
Who Benefits From the Premium Reduction?
Ask whether the reduction reaches the participants who paid premium.
Is a Trust Still Needed?
Ask your attorney whether directing the insurer removes the need for a trust in your situation.
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.
Switch to CFH. Unhappy with your broker? Your employees won’t notice. You will. →
Cookies on This Site
We use cookies to keep the site working properly and to understand how it is used. You can decline anything that is not essential. See our Privacy Policy for the detail.
- Essential: needed for the site to load and for you to move around it. These cannot be switched off.
- Analytics: tell us which pages get read, so we know what is worth writing more of.
- Advertising: set by third parties such as ad and social platforms to measure and target campaigns.