(Reuters) - Alphabet Inc's GOOGL.O life sciences division Verily is partnering with reinsurer Swiss Re to launch a unit to provide stop-loss insurance, a financial product purchased by employers to cover unexpected and large employee healthcare costs.
The subsidiary, Coefficient Insurance Company, will be backed by the commercial insurance arm of Swiss Re SRENH.S, which is also making a minority investment in the new company, Verily said on Tuesday.
“Coefficient is aimed at reducing blind spots and providing greater cost control mechanisms for self-funded employers,” Verily Chief Executive Officer Andy Conrad said in a statement.
Self-insurance arrangements are increasingly commonplace among larger employers, who typically pay health insurers to manage their healthcare benefits, but cover the costs of those claims themselves.
Verily, which was previously part of Google’s research and development unit, has tied up with several pharma companies on projects that range from research on surgical robots to developing the retina scan technology for early detection of some eye diseases.
Reporting by Munsif Vengattil in Bengaluru and Caroline Humer in New York; Editing by Sriraj Kalluvila
Our Standards: The Thomson Reuters Trust Principles.