Why your stop-loss renewal is so high this year (and what you can still negotiate)

If your stop-loss renewal came in 15% or 20% higher than last year, you're in good company. Self-funded employers across the country are opening renewals that look a lot worse than they expected, and many are bracing for another tough round in 2027.

It's frustrating, especially if your own claims didn't feel that bad. But a high renewal isn't the end of the conversation. Here's what's driving stop-loss renewal increases, why switching to a fully insured plan rarely solves the problem, and the levers you can still pull before you sign.

How much are stop-loss renewals going up?

Stop-loss renewals rose 13.6% to 15.9% in 2026, depending on deductible level. That's roughly 5% higher than the increases employers saw at their 2025 renewals. Some large carriers pushed through average increases in the low 20s, and there's no sign of relief for 2027.

Those numbers come from the 2026 Aegis Risk Medical Stop-Loss Premium Survey, co-sponsored by the International Society of Certified Employee Benefit Specialists. It covers more than 1,300 plan sponsors and 1.4 million employees. A few highlights:

• Premiums rose 13.6% for groups with a $100,000 specific deductible and 15.9% for groups with a $750,000 deductible
• Several large direct carriers reported average increases in the low 20% range
• The survey's authors see no easing in the 2027 renewal cycle

If you haven't renewed yet, it's safer to plan for a double-digit increase than to hope for a flat one.

Why stop-loss renewals are climbing

Stop-loss carriers price your renewal based on two things: your own claims and what they're paying out across their whole book of business. Right now, both are moving in the wrong direction.

Catastrophic claims are bigger and more frequent

The claims stop-loss exists to cover are getting larger and showing up more often. In an International Foundation of Employee Benefit Plans (IFEBP) survey, employers named catastrophic claims as the top driver of their health care costs (32%), ahead of specialty drugs, chronic conditions, and provider prices. The same employers project a 10% rise in total health care costs for 2027, the second year in a row at that level.

Specialty drugs are pushing more people over the deductible

Expensive therapies are turning more members into large claimants. Among employers in the IFEBP survey who named specialty drugs as a top cost driver:

• 67% pointed to GLP-1 drugs
• 54% pointed to autoimmune and inflammatory therapies
• 42% pointed to cancer drugs
• 21% pointed to cell and gene therapies

Some of these therapies cost hundreds of thousands of dollars a year. A single member on one of them can blow through a typical specific deductible on their own.

Leveraged trend: why a flat deductible costs more every year

This is the driver most HR leaders haven't heard of, and it's a big one. Leveraged trend is what happens when claim costs rise but your stop-loss deductible stays the same. Because the carrier pays everything above the deductible, it absorbs all of the cost growth above the deductible.

Here's how it plays out with a $100,000 specific deductible:

• Last year, a member had $200,000 in claims. Your carrier paid $100,000.
• This year, the same treatment costs 10% more, or $220,000. Your carrier pays $120,000.
• Claims rose 10%, but the carrier's cost rose 20%.

That gap shows up in your renewal. And plenty of members land above a typical deductible: according to AHRQ data from 2022, people in the top 1% of spenders averaged $147,071 in health care costs for the year.

More lasers at renewal

Carriers are also leaning harder on lasers, which set a higher deductible for a specific member with a known high-cost condition. In the Aegis Risk survey, 19% of plan sponsors reported at least one lasered claimant, up from 16% the year before. A laser can shift hundreds of thousands of dollars of risk back onto your plan, even when the headline rate increase looks manageable.

Should you switch to fully insured?

When a stop-loss renewal stings, a fully insured plan can start to look appealing. You get one premium, no stop-loss contract, and no laser negotiations.

But the same catastrophic claims, specialty drugs, and cost trends are hitting fully insured carriers too. They build that risk into your premium, and you usually get little or no claims data to explain the number. You're still paying for the risk. You just can't see it or manage it.

A tough stop-loss renewal is uncomfortable, but it's risk you can see, model, and negotiate. That's a better position than a black-box renewal you have to take or leave.

That said, self-funding isn't the right fit for every group in every year. Smaller employers with a volatile claims picture may be better served by level funding, which bundles stop-loss into a fixed monthly cost, or a group captive. The right call depends on your numbers, so ask your broker to model your options side by side.

How to negotiate your stop-loss renewal

You have more room to work with than the first renewal number suggests. Here's where to focus.

1. Start early. Begin working with your broker five to six months before your renewal date. Carriers often hold the firm renewal until 30 to 60 days out, and you'll need rates set before open enrollment, so prep has to start well ahead of that. Clean, current claims data, including large claimant updates and prognoses, gives carriers fewer reasons to pad your rate.
2. Index your specific deductible to trend. Raising your deductible in line with medical cost trend keeps the carrier's risk roughly level and is often the single biggest lever on premium.
3. Push back on lasers. Ask the carrier to explain the clinical reasoning behind each laser. If a member's treatment is ending or their prognosis has improved, share that. You can also ask for pricing with and without the laser so you can see what it's really worth.
4. Ask for renewal protections. Rate caps and no-new-laser provisions limit how much your next renewal can move. They cost more upfront, but they're worth pricing out, especially if you have an ongoing large claimant.
5. Check your contract type. In the Aegis Risk survey, 77% of plans used paid or 24/12 contracts, which protect you from claims that are incurred in one policy year but paid in the next. Make sure your contract fits how your TPA actually pays claims, and ask about terminal liability coverage if there's any chance you'll change carriers or funding arrangements.
6. Shop the market carefully. Getting competing quotes is smart, but switching carriers with an open large claimant can backfire. A new carrier can laser that member at a deductible several times your current one, which can wipe out the savings. Weigh the lower premium against that risk.
7. Look at a group captive. If you're a smaller or mid-size employer, pooling part of your stop-loss risk with other employers can smooth out the swings.

Manage the claims behind the renewal

Negotiating gets you through this renewal. Managing your large claims helps with the next one.

• Case management for high-cost members. Early outreach and care coordination can improve outcomes and keep costs from snowballing.
• Centers of excellence. Steering complex procedures, like transplants and cancer treatment, to high-quality, lower-cost facilities can lower your cost per case.
• A specialty drug strategy. Review your PBM contract, set clear coverage criteria for GLP-1s, and look at lower-cost sites of care for infusions.
• Better use of your data. Employers are catching on to this one. In the IFEBP survey, 11% named administration and data analysis, like claim audits and predictive modeling, as their most effective cost strategy, up from 7% the year before.

Questions to ask your broker before you sign

Before you accept your renewal, make sure you can answer these:

• How does our increase compare to the market, and what's driving it?
• Have we modeled higher specific deductibles, and what would each one save?
• Are there lasers on this renewal, and have we negotiated them?
• What would a rate cap or no-new-laser provision cost us?
• Does our contract type match our claims timing?
• Have we gotten competing quotes, and what are the risks of switching?

For more, see our 6 questions to ask at renewal.

Stop-loss renewal FAQ

Why are stop-loss premiums increasing?

Stop-loss premiums are rising because catastrophic claims are getting bigger and more frequent, specialty drugs are pushing more members past their deductibles, and leveraged trend means carriers absorb all claim cost growth above a flat deductible. The 2026 Aegis Risk survey found 2026 increases of 13.6% to 15.9%, depending on deductible level.

What is lasering in stop-loss insurance?

Lasering is when a stop-loss carrier sets a higher specific deductible for one member with a known high-cost condition. Your plan pays that member's claims up to the laser amount before stop-loss coverage kicks in.

How can employers lower stop-loss premiums?

The most effective levers are raising your specific deductible in line with medical trend, negotiating lasers to limit your plan's exposure, shopping the market, and managing your large claims through case management and specialty drug strategy. Group captives can also help smaller and mid-size employers.

Should I raise my stop-loss deductible?

If your deductible hasn't moved in a few years, probably. Holding it flat while claim costs rise means the carrier takes on more risk every year, and your premium reflects that. Ask your broker to model a few deductible levels so you can see the tradeoff.

Is self-funding still worth it when stop-loss rates rise?

For most mid-size employers, yes. Fully insured carriers face the same cost pressures and build them into your premium without showing you the data. Self-funding keeps your claims visible, so you can manage what's driving cost.

Get a second opinion before you sign

A high stop-loss renewal doesn't have to be a take-it-or-leave-it number. Nava's advisors can review your renewal, model your deductible and contract options, and help you negotiate from a stronger position. Talk to an expert.

Want to brush up on the basics first? Read our guide to what stop-loss insurance is and how it works.

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