Stop Loss Requirements and Calculations of Stop Loss Minimums

The State of New Hampshire Insurance Department 21 South Fruit Street, Suite 14 Concord, NH 03301 David J. Bettencourt Keith E. Nyhan Commissioner Deputy Commissioner BULLETIN Docket #INS 26-051-AB TO: All Health Insurers FROM: Commissioner David J. Bettencourt DATE: August 11, 2026 RE: The New Hampshire Insurance Department (NHID) is committed to promoting a stable, transparent, and well-regulated insurance market. This bulletin is issued to support carriers in understanding and meeting their responsibilities under New Hampshire law, and to foster a collaborative regulatory environment that benefits insurers, employers, and consumers alike. Purpose The purpose of this bulletin is to provide clear guidance regarding statutory and regulatory requirements applicable to stop-loss insurance. These requirements arise under RSA 415-H (Stop-Loss Insurance Act). NHID encourages insurers to apply calculations consistently and transparently to ensure compliance with the State’s stop-loss framework and to maintain consistency. This bulletin provides expanded guidance on these requirements based on the statutory and regulatory standards. Scope This bulletin is intended to explain the Department’s interpretation of existing statutory and regulatory requirements governing stop-loss insurance. It does not establish any new legal obligations or replace the requirements of RSA 415-H or Ins 4400.This bulletin is explanatory. The statute and applicable administrative rules constitute the authoritative requirements for all matters of compliance. I. Requirements Under RSA 415-H RSA 415-H establishes minimum attachment point standards, expected claims determination requirements, and annual actuarial certification obligations for stop-loss insurance issued or renewed in the state. Under RSA 415-H:3, I(a), an insurer shall not issue or renew a stop-loss policy with an annual individual Stop Loss Requirements and Calculation of Stop Loss Minimums Telephone 603-271-2261 • Fax 603-271-1406 • TDD Access: Relay NH 1-800-735-2964 insurance.nh.gov attachment point lower than $20,000. RSA 415-H:3, I(b) establishes minimum aggregate attachment point requirements based on employer group size: For employer groups with 50 or fewer members: the aggregate attachment point must be no lower than the greatest of: $4,000 multiplied by the number of members; 120 percent of expected claims; or $20,000. For employer groups with 51 or more members: the aggregate attachment point must be no lower than 110 percent of expected claims. The Commissioner is authorized to amend the statutory minimum attachment point levels based on consideration of the medical components of the Consumer Price Index (CPI) under RSA 415-H:3. Any changes must be published at least six months prior to their effective date. The current standards are published in New Hampshire Code of Administrative Rules under the Chapter “Ins” for the Insurance Department. This ensures that stop-loss minimum standards can be kept current with changes in healthcare costs and market trends. Underscoring both the statutory baseline and the Commissioner’s ability to make CPI-based updates, carriers can better understand what the current rule requires today and how future changes may occur. II. Expected Claims Calculations A central component of stop-loss compliance is the calculation of expected claims, which is used in the statutory formulas for aggregate attachment point minimums. Carriers must ensure that expected claims are determined using sound actuarial methods that accurately reflect the covered population’s anticipated costs for the policy year. Expected claims should be determined using generally accepted actuarial principles. For purposes of demonstrating compliance, the Department expects carriers to maintain internal documentation describing every component of the expected claims calculation. These expectations reflect NHID’s focus on consistent and supportable actuarial practice in alignment with Ins 4401 and RSA 415-H’s certification requirements. Carriers are required to file an annual actuarial certification affirming compliance with RSA 415-H, including attachment point minimums and expected claims calculations. RSA 415-H:4. III. Criteria for Actuarial Certification Ins 4401 requires carriers to appoint a qualified actuary and notify the Commissioner of changes in the appointed actuary. Actuarial certifications affirm compliance with all statutory and regulatory standards and must be submitted annually by March 15. (Ins 4401.06). Page 2 of 5 The certification must specifically address attachment point minimums, expected claims methodologies, and consistency with both RSA 415-H and Ins 4401. Annual filings must include information on declinations, significant renewal increases, and the underlying factors driving those outcomes. Allowable case characteristics are limited to attained age, group size, and industry type. Carriers must ensure that changes in case characteristics during the policy year do not result in rate adjustments, as Ins 4105.04(e) prohibits mid-year rate changes in order to protect employers from sudden pricing volatility. Detailed documentation supporting all calculations must be included with the certification to facilitate NHID review. “Covered lives” and “covered employee members” are different terms with different meanings and are both used in Ins 4401.05. Any requirements tied to covered lives should include all lives covered under the contract including dependents and spouses. Covered employee members means only the employee members and is only used to determine whether it is a small employer group or large employer group. “Covered employee members” refers exclusively to employees enrolled under the employer’s health plan. Dependents and spouses are not included. This term is used only to determine employer group size for applying the appropriate stop-loss regulatory thresholds under Ins 4401.05. “Covered lives” refers to all individuals covered under the employer’s group health plan, including employees, spouses, and dependents. This term is used to calculate certain stoploss attachment point minimums applicable to small employer groups. Employer groups should be classified as follows: • Small Employer Group: An employer group having 50 or fewer covered employee members. • Large Employer Group: An employer group having 51 or more covered employee members. Dependents and spouses are not included when determining group size classification. Insurers may not reclassify groups based on total covered lives. Small Employer Groups (50 or fewer employees) For these groups, the aggregate attachment point must meet or exceed the greatest of the following: • $6,200 × the number of covered lives, • 120% of expected claims, or • $31,000. Page 3 of 5 Because this formula uses covered lives, dependents and spouses increase the minimum permitted aggregate attachment point for small employer groups. Large Employer Groups (51 or more employees) For these employer groups, the aggregate attachment point must be no less than 110% of expected claims. Covered lives are not used in this calculation. Carriers must: • Maintain clear and consistent methodologies for counting both covered employee members and covered lives, as required by Ins 4401.05(e). • Document employee counts separately from total covered lives in filings and actuarial certifications. • Avoid misclassification of employer groups by including dependents or spouses in employee counts. • Ensure actuarial certifications accurately reflect attachment point determinations based on the correct classification. IV. Regulatory Principles The Department offers the following considerations to help carriers understand the broader context in which future compliance and enforcement decisions may be evaluated. • Predictable approaches to calculations and filings support a clear foundation the Department can rely on when reviewing future submissions. • Transparent methods and documentation help ensure that compliance expectations remain well-understood and that reviews can be conducted efficiently and consistently. • Actuarially sound practices contribute to reliable assessments of attachment points and expected claims, which in turn strengthen the integrity of future compliance evaluations. • Consistency in how carriers apply methodologies, classify groups, and present supporting materials helps maintain shared expectations and fosters smoother regulatory interactions. • A stable and competitive stop-loss market benefits all stakeholders, and these principles provide helpful context for how the Department considers compliance within that broader market framework. V. Compliance Expectations NHID appreciates the efforts of carriers to maintain compliance with statutory and regulatory standards. Our goal is to support carriers in applying these stop-loss requirements consistently, to reduce unnecessary regulatory uncertainty, and provide a clear, predictable compliance framework. The Department remains committed to working collaboratively with carriers. Page 4 of 5 Please direct any questions regarding this bulletin or the applicable requirements via email to healthcareanalytics@ins.nh.gov. Page 5 of 5