How much of your renewal was ever yours?
A renewal arrives as one number, and one number cannot be argued with. Underneath it sits a weighting that decides how much of the increase came from your own claims and how much came from the carrier’s book. Enter two figures and see the split. The pre-renewal outlook in our health and cost strategy projects this number before the carrier sends it.
Two figures is all it takes.
Your enrolled contracts and your renewal increase. Everything else follows from those.
Contracts, not employees. This is the number of employees actually enrolled in medical — the single figure your rate is built around.
Every carrier sets its own credibility schedule. The weight actually applied to your group is printed on your rate exhibit, next to the pooling point. If you have never been shown it, that is the first question to ask.
How Your Renewal Splits
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credibility weight on your own claims
Michigan figures are the statewide small-group averages filed with the Department of Insurance and Financial Services: the approved average for 2026 and the average carriers have requested for 2027. National figures are the employer-trend range before plan-design changes. Neither is a substitute for reading your own rate development.
Why contracts, and not headcount.
The Blending Formula
Your rate is z times your own experience, plus one minus z times the book rate. The z is the credibility weight, and it rises with enrolled contracts — commonly reaching full weight at around a thousand. Below that, the manual rate built from age, location and industry carries the balance.
Enrollment, Not Employees
Two companies with 200 employees are not the same group. One at 40 percent take-up has about 80 contracts. One at 90 percent has about 180. That is more than double the credibility at identical headcount, which is why your enrollment percentage is a rate input and not just an HR statistic.
It Cuts Both Ways
High credibility is not a prize. It is leverage, and leverage amplifies whichever way your claims run. A group whose experience beats the book is taxed by being small; a group whose experience is poor is protected by it. Knowing which side you are on changes the negotiation.
The question this lets you ask.
Ask for the Credibility Factor
It is printed on your rate exhibit, beside the pooling point and the community rate. It is a number, not an opinion, and it is recoverable for your group for every year you have been with the carrier. If nobody has ever shown it to you, that is the first thing to ask for.
Then Ask Who Moved What
Once you know the weight, you know which explanations are even available. A below-book result at low credibility cannot be a quiet claims year — the arithmetic will not carry it. It came from the carrier chosen and whether anyone tested the market. Those are decisions someone made on your behalf, or did not.
Figures are drawn from Michigan Department of Insurance and Financial Services filings and published national employer-trend surveys. General information for planning, not actuarial advice on your specific plan.
What employers ask about a renewal increase.
The six that come up every autumn.
My health insurance renewal went up 15 percent. What can we do?
Start by finding out how much of the increase is the market and how much is your own claims, which the decoder above does with two figures. Then ask the carrier for the rate build-up, and put the group in front of other carriers before the renewal deadline, because options narrow in the last 30 days. After that the levers are plan design, your contribution strategy and, for larger groups, the funding model. Send us your renewal and we will tell you whether it looks competitive.
Can we negotiate a health insurance renewal increase?
It depends on your size. Small group rates in Michigan are filed and approved by the state before your renewal arrives, so there is little room to negotiate the rate itself, and the real levers are plan design and moving to another carrier. Larger groups have more room, because the carrier prices them partly on their own experience, so rating method, plan design and funding model can all be discussed. See self-funded health plans and what changes at fifty employees.
Why did our health insurance renewal increase so much?
Some of it is the market and some of it is you, and the ratio depends on your size. Michigan small group carriers filed for an average increase of about 11 percent for 2026, and national employer trend ran 9 to 10 percent before plan-design changes. Underneath that, the share attributable to your own claims is set by your credibility weight, which rises with enrolled contracts. Below about 100 contracts your own experience explains almost none of the move, whatever anyone tells you.
What is a normal health insurance renewal increase for 2027?
For a fully insured Michigan small group, carriers have requested a statewide average of 9.6 percent for 2027, after an approved average of 11.1 percent for 2026. For larger and self-funded employers the closer comparator is national employer trend at 9 to 10 percent before plan changes. A self-funded employer should also expect stop-loss to move faster, since stop-loss premium rose 13.6 to 15.9 percent for 2026 through leveraged trend.
How do I know if our health insurance renewal increase is fair?
Compare it against the right baseline for your funding type, then ask what share of it could even have been yours. A renewal five points under the filed average at 40 enrolled contracts was not a good claims year, because at that size your claims carry almost no weight. It was carrier selection and a market test. That distinction is the difference between a result that repeats and one that was luck.
What is credibility on a group health renewal?
It is the weight a carrier gives your own claims experience against its manual book rate, and it is printed on your rate exhibit beside the pooling point. Full credibility commonly requires around 1,000 enrolled contracts; below that the manual rate built from age, location and industry carries the balance. It is a number, not an opinion, and if nobody has shown it to you that is the first thing to ask for.
What to do with the number you just decoded → · How your renewal compares → · Check your participation →
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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