TR14437 - A Resolution of the City Commission of the City of Tamarac, Florida, approving the renewal of Stop Loss Insurance Coverage with Cigna for Plan Year 2027, beginning January 1, 2027, through December 31, 2027, at a Total Annual Premium of $930,468.71; authorizing the appropriate City Officials to execute the necessary documents; Providing for conflicts; providing for severability; and providing for an effective date.

The Director of Human Resources recommends that the City Commission approves the renewal of the individual and aggregate Stop Loss Insurance with Cigna for January 1 through December 31, 2027, at the rates and terms summarized in Exhibit “A,” Stop Loss Insurance Rate Summary, and supported by Exhibit “B,” Cigna Stop Loss Renewal Proposal, at its October 28, 2026 meeting.

The City maintains Stop Loss insurance to protect its self-insured medical plan against unusually high claims. This coverage provides financial protection for eligible individual claims exceeding the $250,000 deductible and total eligible claims exceeding the policy’s annual aggregate threshold.

While the City’s claims experience has performed favorably, with no large claims exceeding the stop loss deductible through August 2026, the broader stop loss market continues to experience significant upward pricing pressure. Medical and pharmacy costs continue to rise, while the frequency and severity of catastrophic claims are increasing nationally, driven by areas such as oncology, specialty pharmacy, complex hospital care, and emerging gene and cell therapies. 

Against this market backdrop, Lockton’s early renewal negotiations with Cigna resulted in an overall increase of approximately 10.21%, below the 25% initially projected for budgeting purposes. The individual stop loss rate increases from $157.87 to $179.11 per employee per month, while the aggregate stop loss rate decreases from $22.07 to $19.20. These rates are paid entirely by the City for employer-sponsored stop loss insurance, which protects the City’s self-insured medical plan against high claims. The increase does not affect employee medical insurance premiums or require any additional employee contributions.

The renewal continues individual and aggregate coverage for eligible medical and prescription claims and maintains the $250,000 individual deductible without adding higher deductibles for specific covered members (“lasers”). Annual maximums are unlimited, subject to the policy’s terms. Aggregate coverage includes three months of terminal liability. 

Exhibit “A” presents the stop loss rates, enrollment assumptions, estimated annual premiums and coverage terms. Exhibit “B” opens with a plain-language renewal summary informed by Lockton’s renewal deck, followed by Cigna’s individual proposal 99361, aggregate proposal 47745, and complete terms and conditions. These documents describe the coverage and pricing proposed for the January 1 through December 31, 2027 renewal. The Director of Human Resources recommends continuing this coverage with Cigna.

Any revisions after Commission approval will be limited to non-material administrative changes that do not increase the approved rates or materially alter coverage, subject to approval by the City Manager and City Attorney.

City Commission approval is needed to renew Cigna's Stop Loss Insurance with an overall premium increase of 10.21% for Plan Year 2027.