What to Do When Health Insurance Rates Rise Despite Good Claims Experience

If you have opened your renewal letter and seen your health insurance premiums jump, it can feel especially frustrating when your business has had good claims experience. Many small employers get grouped into larger community rated pools. If the overall pool has high cost claims, everyone can see increases even if your company managed costs well.

At the National Automotive, Roads, and Fuel Association (NARFA), we have helped employers since 1929 find better options. Whether you are an auto dealer, repair shop, body shop, service station, or fuel distributor, our programs are designed to protect members from unfair increases.

Why Premiums Increase Even With Good Claims

Even when your company’s claims are low, renewals can still rise due to both pooling and market cost drivers:

• Community rating pools small employers together. Poor performance in the pool can raise rates for all participants.
• Large medical claims such as cancer, heart surgery, or complicated births
• Multiple claims in a single year including accidents and chronic conditions
• High prescription drug costs, especially specialty medications
• Greater use of mental health and substance use treatment
• More emergency room visits and hospitalizations

Options NARFA Members Can Rely On

Level Funded Health Plans

With level funding, your monthly costs are based on your own projected claims rather than broad community averages. If claims come in lower than expected, surplus can help offset future increases. Stop loss protection caps exposure if claims rise unexpectedly.

• Best for: Employers with good claims experience who want predictable costs and the chance to benefit from strong performance.

High Deductible Plans With Health Savings Accounts

Pairing a high deductible health plan with a health savings account can lower premiums and give employees tax advantaged savings. This creates immediate relief and builds reserves for future expenses.

• Best for: Employers seeking near term premium relief and long term savings opportunities.

NARFA Group Buying Power

By pooling hundreds of members, NARFA spreads risk and secures exclusive rates that are not available on the open market. Strong claims performance from many members helps create stability for the whole group.

• Best for: Employers who want traditional coverage with added protection from group strength.

Why Businesses Trust NARFA

• Nearly 100 years of stability and advocacy
• Deep expertise across automotive, roads, and fuel businesses
• Strength in numbers so bad years are balanced by good years
• Multiple solutions tailored to your situation

Next Steps

1. Share your current census and plan details
2. Get a claims analysis and risk review
3. Explore tailored alternatives with NARFA experts
4. Choose a solution that protects your business and your employees

Take Control of Your Benefits

You do not have to accept unfair rate increases. NARFA provides options built around your business, your employees, and your claims experience.

Call 800-258-5318 or visit narfa.com to get started.

Want a quick summary? Download our full Rate Increase Bulletin.