What Is Stop Loss In Health Insurance? 
Some people use the term `` stop loss '' to mean `` maximum out-of-pocket exposures '' which is the point in a person 's health insurance policy when they 've met their deductible and any co-insurance cost sharing and the health insurance carrier becomes 100 % responsible for all health care costs after that point . Technically this is an incorrect use of the term . Stop loss traditionally refers to reinsurance arrangements within self-insured group health insurance plans . There are two types of stop loss insurance , specific and aggregate . Specific stop loss insurance protects the group plan from claims exposure above a certain point for any insured person in the group . For example , a $ 50,000 specific stop loss policy means the employer accepts the risk for the first $ 50,000 in claims on an individual and after that point the reinsurance carrier pays the rest of the cost . Aggregate stop loss insurance protects the employer from claims liability for the entire insured group above a certain point . A $ 1 million aggregate stop loss policy means the employer accepts the liability for the first $ 1 million in claims for their entire insured group , if the group 's claims exceed this limit then the aggregate reinsurance carrier pays the rest of the cost . 