Social Security Board Inks Reinsurance Coverage
On Tuesday, January 9, 2016, the Social Security Board (Board) as operator of the National Health Insurance Program signed a reinsurance contract with Munich Reinsurance Company Canada Branch (Life) of Toronto, Ontario (Reinsurer).
Under the reinsurance contract, the Board will retain the first $250,000 of its gross liability per beneficiary, per contract year.
The Reinsurer will accept 100% of the Board’s contractual liability for benefit claims in excess of $250,000 up to a maximum of $750,000 per Beneficiary, per contract year.
The maximum lifetime benefit limit, for reinsurance, is $1,000,000 per Beneficiary.
Having reinsurance protects the Board from excessive losses by reducing the risk of having to pay large obligations resulting from an excessive benefit claim.
Chairman of the Social Security Board, Mr. Ian S. Smith, congratulated the Reinsurers on being the successful provider of reinsurance to the Board. Mr. Smith stated that having reinsurance ensures that the National Health Insurance can remain financially sound because the risks and costs are spread.
Director of the Social Security Board, Antoinette Skelton, noted that although the document was signed on January 9th, the Board and the Reinsurer had reached an agreement prior to January 1, 2016, successfully securing the Board’s financial position.
