What does Self-Funded Plan mean? Read on to discover the definition & meaning of the term Self-Funded Plan - to help you better understand the language used in insurance policies.
A self-funded plan is a type of health insurance in which a company directly funds the costs of health care for its employees instead of using the products and services of an insurance company. So, with a self-funded plan, companies essentially act as health insurers. Companies who self-fund their plans are responsible for paying out all claims.
More Insurance Terms And Definitions
The Merriam-Webster Dictionary defines insurance as:
b: Coverage by contract whereby one party undertakes to indemnify or guarantee another against loss by a specified contingency or peril.
c: The sum for which something is insured.
We hope the you have a better understanding of the meaning of Self-Funded Plan. If you are looking for the meanings of other important insurance terms and their definitions, just click on the letter below to find the words & concepts you are looking for: