Healthcare costs continue to rise at an unsustainable pace, creating significant challenges for employers trying to balance affordability, quality benefits, and long-term financial stability.
During our recent Crumdale Captive Solutions webinar, we explored why more employers are moving beyond traditional fully insured models and considering group medical stop loss captives as a long-term strategy for controlling healthcare spend.
Here are a few key takeaways from the discussion:
The Traditional Model Is Becoming Increasingly Difficult to Sustain
Healthcare premiums have increased dramatically over the last several years, with 2026 projections expected to rise another 9–10%, the steepest increase in more than a decade. Employers are facing mounting pressure as healthcare remains one of their largest operating expenses, second only to payroll in many organizations.
At the same time, high-cost claims continue to accelerate, driven largely by specialty medications, gene therapies, cancer treatments, and catastrophic medical events. Million-dollar claims are becoming far more common than they were even a few years ago.
Group Captives Allow Employers to Share Risk More Strategically
A group medical stop loss captive allows employers to join together to create a larger, more stable risk pool while maintaining the advantages of self-funding. The structure is designed to provide greater transparency, long-term stability, and the opportunity to participate in underwriting gains.
The webinar outlined the three primary layers of a captive structure:
- The employer’s self-funded layer for more predictable claims
- The captive layer where risk is shared among participating employers
- The reinsurance layer that protects against catastrophic losses
This structure helps reduce volatility while creating insulation from large year-over-year renewal swings.
Captives Are About Long-Term Strategy, Not Short-Term Transactions
One of the most important themes discussed during the webinar was that successful captive participation requires a long-term mindset.
Unlike traditional fully insured arrangements that often reset annually, captives are designed to create stability over time through collaboration, transparency, and proactive risk management. Employers gain greater insight into claims drivers, plan performance, and opportunities to improve outcomes.
Small and Mid-Sized Employers Now Have Access to Strategies Previously Reserved for Large Organizations
Historically, many self-funded strategies were only realistic for large employers with significant scale. Captive structures have changed that.
By pooling risk with like-minded employers, small and mid-sized organizations can access more sophisticated funding arrangements, enhanced reporting, stronger cost containment strategies, and greater plan flexibility.
Captive Participation Is Not “All or Nothing”
A common question during the webinar centered around flexibility and employer protections within the captive structure.
The discussion highlighted the built-in safeguards designed to protect participating employers, including specific and aggregate stop loss coverage, collateral protections, and reinsurance layers that help manage catastrophic exposure.
The Crumdale team also emphasized that captive strategies are designed to create more predictable and insulated renewals over time rather than simply removing employers after difficult claims years.
Final Thoughts
As healthcare costs continue to rise, employers are increasingly looking for alternatives to the traditional cycle of annual premium increases and limited transparency.
For organizations seeking greater control, long-term sustainability, and a more strategic approach to employee benefits, group captives continue to emerge as a compelling option worth evaluating.
If you were unable to attend the webinar live or would like to continue the conversation, the Crumdale team would be happy to discuss whether a captive strategy may be a fit for your organization.
