Fully Insured Health Plan
Definition - What does Fully Insured Health Plan mean?
A fully insured health plan is a health insurance plan in which an employer pays a specific premium amount to an insurance company to get coverage for a specific number of employees. Fully insured health plans are an alternative to self-funded plans, in which an employer acts as its own health insurance company.
Insuranceopedia explains Fully Insured Health Plan
With fully insured plans, the health insurance company handles all of the administrative responsibilities and pays out all of the claims. With a self-funded insurance policy, these responsibilities typically fall on the employer. Fully insured plans are often more expensive because they require premium payments. However, self-funded insurance plans can be more difficult for the employer to manage since the employer would be responsible for both paying out the claims and managing the policies itself.