High claims push Voya 2025 medical stop-loss rates higher

Executives at Voya Financial aren’t talking about the reasons, but they said last week that their medical stop-loss ratio was higher than expected in the second quarter and needs correcting.

Medical stop-loss insurance is what employers’ self-funded health insurance plans use to protect themselves against catastrophic claims.

Voya wants to keep total ratio of insured losses to premiums for health-related insurance products, including stop-loss, between 77% and 80%.

In the second quarter, the stop-loss ratio was somewhere between 80% and 83%, executives said.

Related: Medical stop-loss premiums rise 11.5% for self-funded plans

“We are actively addressing loss ratios by adjusting pricing on new business and renewals in order to return to our target range in 2025,” according to Heather Lavallee, the CEO.

Donald Templin, Voya’s CFO, predicted employers will continue to shift toward self-funding their health plans and use of stop-loss in spite of stop-loss increases.

“We continue to find the fundamentals of the stop-loss business attractive as it can be repriced annually, has a natural tailwind for growth due to medical inflation and is a growing market as companies move to self-fund their employee health care plans,” Templin said.

Voya executives talked about stop-loss during a conference call they held with securities analysts to go over earnings for the second quarter, which ended June 30.

Voya reported $235 million in net income for the second quarter on $2 billion in revenue, compared with $235 million in net income on $1.9 billion for the second quarter of 2023.