Aviva confirms launch of 'Corporate Excess' healthcare trust

Scheme will be rival to WPA’s offering

Aviva UK Health has launched a new type of tax-efficient healthcare trust to rival WPA’s Corporate Deductible scheme.

WPA developed the new method of funding last year, and now Aviva has brought to market its own version, called Corporate Excess.

Under the plan, companies have a corporate excess set on the policy, from which employee claims are paid.

The excess is generally around 80% of the predicted claims fund and is held in trust by Aviva. A claims reserve is calculated on the remaining claim fund which will be used to pay claims if the excess is used in full.

Aviva says the advantage of using Corporate Excess is that it does not attract insurance premium tax (IPT), and instead companies only pay IPT on the claims reserve, as well as administration and insurance risk charges.

The provider says it gives smaller companies the opportunity to benefit from cost efficiencies previously only available to larger schemes through a healthcare trust.

Nick Reynolds, head of PMI at Aviva UK Health, said: “We’re pleased that with the introduction of the new Corporate Excess option on our Optimum PMI scheme, a wider range of employers can benefit from the same cost efficiencies that our larger corporate healthcare customers enjoy.

“We know from our corporate customers that they place a high value on providing health cover for employees, but with economic challenges they increasingly require flexibility in how their scheme is funded, as well as the level of cover offered. The new Corporate Excess funding option has been introduced to help many more companies control their health insurance costs.”                                                                                                  

Companies with over 250 employees taking out Optimum PMI cover with Aviva now have four different funding options to choose from: fully insured, cost plus, corporate excess or healthcare trust.

Aviva first revealed its plans to launch a 'Corporate Excess' trust option at a Health Insurance Boardroom Briefing last month.

Look out for an analysis on www.hi-mag.com and in a forthcoming issue of Health Insurance.

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