If you are a group insurer offering tapered benefit products, we have just made your group administrator's lives a lot easier. Today we announce the general availability of new benefit tapering features in Sentro.
What is a tapered benefit?
A tapered benefit insurance product adjusts the amount of insurance coverage provided based on a parameter.
The most common example is in group life insurance, with age as the parameter. It is quite common to offer coverage based on a multiple of the insured person's salary. But that coverage may be 'tapered' downwards by a percentage based on the insured person's age. For example, the insurer may want to reduce the coverage level to 80 percent of the salary multiple at age 62, to 60 percent at age 63, to 40 percent at age 64, and 20 percent at age 65.
Why is this such a pain to administer?
You can imagine that in a large group, there is a wide array of member ages and birth dates. Birthdays happen all the time! Rates are often established at the start of a plan year. How do you handle invoicing when a member's coverage level might change mid-plan with a tapering rule? What if actuary want to change the timing and the scale of tapering? What it you don't get timely information from your customer about employee changes?
For the group insurance administrator, a tapered benefit group plan has many more 'moving parts' than a more standard fixed sum assured group plan. If the administrator is trying to run a tapered benefit plan on a spreadsheet and is invoicing the plan annually, accurately calculating adjustments and refunds due is a diabolically painful exercise.
How Sentro makes running tapered benefit plans easy
The Plan Tapering feature allows you to select from a list of tapering formulas, and apply them to a Plan Product in a Group Plan.
Age Basis for applying tapering include:
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Current Age - the benefit will be tapered on the exact birthdate if the insured member
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Age At Plan Start - the benefit will be tapered based on the age of the insured member at the start of the group plan period
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Age At Plan End - the benefit will be tapered based on the age of the insured member at the end of the group plan period
The percentage tapering amount and the number of age band steps is definable. So if you need different tapering models for different products or different customers, no problem!
Combined with our powerful automatic billing proration capabilities, using our Plan Tapering features means that Sentro automatically handles all of the elaborate Sum Assured calculations, timing of the Sum Assured coverage changes, and accurately prorates the associated premium billing, for each and every member on a scheme.
This is an administrative gamechanger for insurers who offer tapered benefit products.
Available now!
Plan Tapering is available now for Sentro customers. If you'd like a demonstration, please contact us! We'd be happy to show you how you can save time and improve accuracy in your tapered benefit products using Sentro.