These terms (the “Stop-Loss Terms”) are agreed by Level Benefits, Inc., a Delaware corporation doing business as Level and Level Administrators (together with its affiliates, “Level”) and the organization purchasing third party administrator services from Level (“Sponsor,” and together with Level, the “Parties”). These Terms govern the engagement of Level by Sponsor to provide services (“Services”) to individuals enrolled (“Participants”) in a benefits plan (the “Plan”) that Sponsor will offer to its eligible employees and their eligible dependents. These Stop-Loss Terms are additional to the Level Customer Terms, Dental, Vision and Medical Benefit Plan Terms, and all other applicable terms, policies or guidance issued by Level or incorporated by reference herein (together, the “Terms” and all available at level.com/legal/terms).
Level will identify an insurance carrier that issues stop-loss coverage to benefit plan sponsors.
Application. Level will facilitate Sponsor’s application for a stop-loss policy, and by applying for a stop-loss policy, Sponsor agrees to the terms of the application.
Policy. Sponsor will be required to provide final approval for the policy. THE STOP-LOSS POLICY WILL BE A BINDING CONTRACT BETWEEN SPONSOR AND THE INSURANCE CARRIER, AND SPONSOR SHOULD REVIEW IT CAREFULLY.
Information Disclosure. If a stop-loss policy is issued and approved, Level will provide the stop-loss carrier (on Sponsor’s behalf) with all regular and incidental reports and information requested by the carrier under the policy. If information requested by the carrier is uniquely in the possession of Sponsor, Level will work with Sponsor to obtain the information and forward it to the carrier.
Plan Termination. In the event that the benefit plan Services provided by Level to Sponsor are terminated for any reason, Level will promptly notify the stop-loss carrier and the stop-loss coverage will usually end on the same date as the termination of the benefit plan Services or as soon as possible thereafter.
If Sponsor notifies Level of a change in the plan design, a change in the eligibility rules, or of an exception, Level will seek prior written approval from the stop-loss carrier for the change or the exception at the direction of Sponsor. Sponsor acknowledges that if the stop-loss carrier does not provide prior written approval for for such change or exception Sponsor’s adoption of the change or exception may negatively affect Sponsor’s entitlement to benefits under the stop-loss policy, including that claims incurred pursuant to such un-approved change or exception may not be considered covered claims (and would not count toward any aggregate annual deductible) under the stop-loss policy.
At any time during the Term, Level reserves the right to update amounts owed for the Services if Customer’s enrollment changes more than 10% from the beginning of the relevant Service Term.
At the beginning of each Term, Level will advise Sponsor of the total expected cost of claims to be incurred during the Term (the “Expected Claims”). After the end of each Term, Level will determine the total cost of claims actually incurred and paid during the Term (the “Incurred Claims”) and make a reasonable estimate for claims incurred but not yet reported (“Anticipated Claims”). If Level determines that the Expected Claims exceed the Incurred Claims plus Anticipated Claims for the Term (the “Surplus”), then Level may refund or credit a percentage of the Surplus to Sponsor. Level will provide Sponsor with a written summary of its calculations and the refund or credit (if applicable) within nine (9) months after the end of the Term.
During the Term, and for a period of seven (7) years following termination for any reason, Sponsor agrees to maintain eligibility and enrollment records relevant to the Plan, including evidence of eligibility to enroll for each Participant in accordance with the Plan. During that same period, Level will have the right to audit and inspect Sponsor’s books and records concerning enrollment and eligibility of Participants. This right of audit and inspection will be during normal business hours upon reasonable notice to Sponsor.
If Incurred Claims were funded, in whole or in part, by employee contributions, Sponsor acknowledges that the portion of the refund attributable to employee contributions constitutes “plan assets” under ERISA and that ERISA limits the permitted uses of the same.
Last updated: November 30, 2021
