GAP Insurance

Health insurance costs continue to put pressure on Alabama employers.

For groups effective October 1, 2026 and beyond, Providence Benefits received guidance that Alabama's dominant health insurance carrier increased its maximum rate increase cap from 25% to 50%.

In the state of Alabama GAP Insurance has a bad reputation because of the many rate increases the plans have had historically. Some companies have been moved to different insurance companies or different Third-Party Administrators 5 or 6 times in the past 6-7 years. Many well-intended brokers have blamed the carriers or the TPA’s for the rate increases and worked hard to find a carrier that promises they will not give a rate increase. What we are continuing to see is carriers over promise and then give a rate increase in a year, or two at most.

When GAP Insurance first came on the scene it was a “No-Brainer” to show an employer how they could move from a low-deductible health insurance plan to a high deductible plan and use GAP insurance to “bridge the GAP”. Therefore, GAP insurance or Bridge insurance became quite popular.