Principal Unveils DC Health Plan

May 21, 2002 ( - The Principal Financial Group unveiled a defined contribution health-care plan for its self-funded customers.

The Minimum Premium Funding plan provided by the Principal Life Insurance Company allows companies to pay part of their premium and then deposit funds into a separate bank account to cover claims.

According to Principal, money will be deducted as claims occur. The company said clients could manage cash flow through:

controlling costs through Principal’s claims maximums, and

deferring fixed costs for the first two months and then spreading the costs over the remaining 10 months

Principal said the product may be timely because many employers now emphasize “need to have” benefits such as health and life insurance from “nice to have” amenities.