Self-funding insurance programs consist of two principle insurance coverage designs: specific stop loss and aggregate stop loss.

Specific stop loss protects the plan from large losses on any one participant who has experienced a serious illness or catastrophic claims during the plan year. The employer will choose a dollar amount to cap their liability on each individual employee. When an individual participant's claims exceed the set maximum, the stop-loss coverage takes over for the employer, reimbursing them for any claims paid on that individual for the remainder of the plan year.

Aggregate stop loss protects the plan from losses exceeding a determined amount, which results from the group's total claims for a plan year. The employer and the insurance company will determine a maximum amount of liability that the employer must fund in a plan year.

Insurance companies determine rates based on the benefit plan liability the employer accepts. NM&A assists in the process of securing specific and aggregate stop loss coverage for the employer.