Third Party Administration

What Does Third Party Administration Mean?

A third-party administrator (TPA) is a company often hired by employers to handle certain administrative responsibilities. Employers engage these firms to reduce their workload. The responsibilities managed by TPAs may include risk management, claims administration, loss control, and various other tasks.

Insuranceopedia Explains Third Party Administration

It often makes more sense for companies to hire third-party administration firms than to handle all administrative responsibilities themselves. These firms specialize in managing insurance policies and frequently act as intermediaries between the insurer and the company. By outsourcing the administration of insurance policies to third-party administrators, companies can focus on other priorities, such as increasing profits and managing other important aspects of their operations.