|
ian River Countv BOCC
<br />Excess Workers Compensation
<br />The market for Excess Workers Compensation Coverage, while stabilizing, has limited markets
<br />willing to offer coverage to Entities with Fire and Police exposures which are subject to
<br />presumption laws. This is driving up the cost of excess workers compensation coverage. In
<br />many cases, excess carriers will not provide coverage below a $750,000 SIR for accounts with
<br />Fire and/or Police exposures.
<br />For the 2015 renewal, we provided the County with the option of lowering their SIR from
<br />$750,000 to $650,000 (except for $1M for USL&H & Jones Act), for which the County selected.
<br />Safety, National is the current carrier for this line of coverage and we were successful in negotiating the
<br />renewal at a flat rate of .20975 as per expiring program.
<br />In addition we negotiated a 2 -year rate guarantee at the same terms as the expiring program
<br />Negotiating a two year rate guarantee is a major enhancement that allows the County to have stability in
<br />rate and terms for the next two calendar years.
<br />Below please find the Workers Compensation Summary since 2014:
<br />As you can see above, the premium has increased from the expiring program by $5,232 or 3.5% and this
<br />is a direct result of the estimated payroll increasing by the same percentage for the renewal. The rate
<br />remained flat but the premium was adjusted due to the increase in payroll.
<br />In addition, we negotiated a reduction to the minimum earned premium this year. As you can see, in
<br />years' past, the minimum premium was the annual premium. Therefore, going forward, if the County
<br />has reported more payroll than the actual payroll incurred, a refund would be generated, but not for an
<br />amount less than the annual minimum earned premium of $139,271.
<br />Please note there are conditions for the Rate Guarantee and these are noted below:
<br />CONDITIONS FOR RATE GUARANTEE:
<br />1) The treatment of Allocated Loss Adjustment Expense with respect to the SIR and Limits must remain
<br />thesame as expiring per the 2016 Policy Period bound with Safety National.
<br />W" kir.,t"c fes_,' i4r HIM
<br />x_01632017
<br />X2015=2016_ - z. t20T442015
<br />Deductibles:
<br />USL&H & Jones Act
<br />$1M
<br />$1M
<br />$1M
<br />All Other Payroll
<br />$650,000
<br />$650,000
<br />$750,000
<br />Employers Liability Limit of
<br />Liability
<br />$2,000,000
<br />$2,000,000
<br />$2,000,000
<br />Specific Limit
<br />Statutory
<br />Statutory
<br />Statutory
<br />Deposit Premium
<br />$154,745
<br />$149,513
<br />$179,408
<br />Minimum Premium
<br />$139,271
<br />$149,513
<br />$179,408
<br />Rate_per $100 of Payroll
<br />$0.20975
<br />$0.20975
<br />$0.2628
<br />Payroll
<br />$73,776,152
<br />$71,281,306
<br />$68,267,867
<br />As you can see above, the premium has increased from the expiring program by $5,232 or 3.5% and this
<br />is a direct result of the estimated payroll increasing by the same percentage for the renewal. The rate
<br />remained flat but the premium was adjusted due to the increase in payroll.
<br />In addition, we negotiated a reduction to the minimum earned premium this year. As you can see, in
<br />years' past, the minimum premium was the annual premium. Therefore, going forward, if the County
<br />has reported more payroll than the actual payroll incurred, a refund would be generated, but not for an
<br />amount less than the annual minimum earned premium of $139,271.
<br />Please note there are conditions for the Rate Guarantee and these are noted below:
<br />CONDITIONS FOR RATE GUARANTEE:
<br />1) The treatment of Allocated Loss Adjustment Expense with respect to the SIR and Limits must remain
<br />thesame as expiring per the 2016 Policy Period bound with Safety National.
<br />W" kir.,t"c fes_,' i4r HIM
<br />
|