Money back guarentee

Equitable Life, a company I have a good relationship with and have enjoyed working with in the past has a new offering I wanted to touch on briefly.

They are calling it Rate Shield, and it is essentially a mini “Refund” plan. Normally Refund is reserved for 100+ member groups, and only one of two carriers still offer it. Equitable will do a Refund plan on your first renewal of a small group starting at 10 members.

It works like this.

If you claim less than your Target Loss Ratio (TLR), you get a refund of the difference. You will recall that the TLR is essentially the ratio of administration expenses and Claims Paid. So an example of a TLR of 80.5% means:  19.5% of your premium is going to admin, and the rest, 80.5% is going to pay claims.

Let’s say your Extended Health Care premium is $30,000 per year, your TLR is 80.5% and at your first renewal you actually claimed 76.5%. You claimed 4% less than budgeted (80.5% - 76.5% = 4%) so in reality you overpaid by 4%. Not any more, Equitable Life will refund you 4% of your premium (4% x $30,000 = $1200).

You get a cheque for $1200, well not quite, they do charge a $100 admin fee so the cheque is for $1100.Still pretty good. It is a shame they will only do it for the first renewal, I would love to see it as a permanent feature.



On a side note, I have always found that Equitable Life's renewal are very fair, the rates they come up with are almost always dead on what I calculate independently. This basically never happens with any other carrier, except possibly Wawanesa.


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Robert Reynolds, GBA
Certified Group Benefits Advisor
Hendry McKenzie Reynolds Employee Benefits Ltd.

Toll Free: 1-888-592-4614
rob@hmrinsurance.ca
www.hmrinsurance.ca

E.O. E.