Tyler Barrish

Tyler Barrish asked about the specific assumptions that contribute to the high and low ends of TriNet's insurance cost ratio (ICR) guidance, and sought clarification on the month-to-month WSE growth dynamics during the last quarter.

Answer

Mala Murthy, EVP and CFO, explained that the midpoint of the ICR guidance assumes a continuation of Q4 trends, reflecting improved actuarial capabilities. The range is informed by expected medical trends (high single-digit inflation) and pharmaceutical trends (low double-digit inflation). She stated that month-to-month WSE color is not provided, but generally, Q1 sees a decline due to offboarding, with a ramp-up through the year. Mike Simonds, President and CEO, added that the low single-digit WSE number oscillated but showed no discernible trend.

Tyler Barrish, on behalf of Toby Sommer, asked about the assumptions that drive the high and low ends of TriNet's insurance ratio guidance. He also inquired about the month-to-month WSE growth dynamics within the quarter, asking if any months were better or worse than others.

Answer

Mala Murthy (EVP and CFO) explained that the midpoint of the insurance ratio guidance assumes a continuation of Q4 2025 trends, reflecting improved actuarial capabilities. The range is dependent on medical cost trends (high single-digit inflation for medical, low double-digit for pharma), with the favorable end assuming better trends and the unfavorable end assuming depreciation. She stated that TriNet does not provide month-to-month WSE color, but generally expects a decline in Q1 due to offboarding, followed by a ramp-up. Mike Simonds (President and CEO) added that 2025 showed no discernible month-to-month or quarter-to-quarter trend beyond low single-digit oscillation.