Risk-Sharing News

Risk-Sharing

2016 Year End Report to the Membership

We have just completed another successful year within the SDML Workers’ Compensation Fund. It has become tradition to share the year end numbers with our Membership for the past year.

Membership Growth:

The number of public entities that purchase their work comp coverage from the SDML Workers’ Compensation Fund continues to grow. Below is a history of the Membership numbers from the very beginning of the SDML Workers’ Compensation Fund.

Year Members

1987 The Fund’s 1

st

Year 57 1995 Insurance Benefits 1st Year as Administrator 188 2000 209 2005 290 2010 362 2015 416 2016 – 10 New Members added in 2016 426

2016 Net Estimated Numbers Contributions

Cities 234 $3,367,266 Counties 66(All Counties in SD)$3,261,071 Townships 14 $11,166 Fire Districts 30 $78,742 Conservation Districts52 $55,908 Irrigation Districts 1 $16,663 Sanitary Districts 5 $12,758 Solid Waste Districts 2 $5,846 Boards & Misc. 13 $81,195 Ambulance Districts11 $90,474

Total 426 $6,981,089

SDML WCF Claims Information:

2000 846 Claims 98.55% Loss Ratio 2005 888 Claims 93.93% Loss Ratio 2010 1,006 Claims67.83% Loss Ratio 2015 1,103 Claims53.68% Loss Ratio 2016 (as of 12/12/16)962 Claims 42.57% Loss Ratio

The number of members has more than doubled since the year 2000. The claims activity has remained relatively stable in both the number of claims (Frequency) and the dollar cost of those claims (Severity). This has been consistent for several reasons. First, the solid underwriting practices that Insurance Benefits uses when adding new members. Second, the claims management and use of rehab nurses that Claims Associates provides. Third, the active loss control programs that are provided by Safety Benefits. Fourth, your commitment to building a culture of safety for your employees through the use of safety programs and training.

The SDML Workers’ Compensation Fund uses an actuarial firm, AON Risk Solutions, to evaluate claims, expenses, and to determine the rates that we need to charge you, our Members, on an annual basis. The actuarial firm also looks

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at each individual member’s claims experience and determines each Member’s Fund Modifier based on your individual claims history.

2017: No Change in Rates or Credits.As reported at the Annual Meeting in October, because of the financial strength of the Fund, the SDML Workers’ Compensation Fund Board of Trustees decided to keep the 2017 rates and credits the same as 2016. The Renewal Credit is 15%, the Loss Control Credit is 9% and the Equity Credit is 10% Pro-Rata share. These credits equal more than a 21% savings for your workers’ compensation coverage and puts money back into your budget.

As a risk management strategy, the SDML Workers’ Compensation Fund purchases Excess “Reinsurance” to protect your financial assets. This is purchased through Safety National Casualty Corporation. SNCC carries an A.M. Best Rating of an A+ (Superior), for it’s financial strength. The “Self-Insured Retention” (the amount that the SDML WCF pays for each claim prior to “reinsurance” stepping in and paying the amount above this dollar amount) is $900,000 for each occurrence and will remain at that level for the fourth consecutive year. Since 1987, the SDML Workers’ Compensation Fund has only had 14 claims that have ever reached the SelfInsured Retention (SIR) limit.

We are providing this information to you as Members, so that you understand the importance of purchasing reinsurance. It caps the amount of claims dollars that would be paid by the SDML Workers’ Compensation Fund, for any one occurrence.

2017 Grant Programs. For seven years the SDML Workers’ Compensation Fund has offered two grant programs to its members. Because these grant programs promote safety, the SDML WC Fund Board of Trustees decided to offer both grant programs for the 2017 year on a first come first serve basis until the grant funds are exhausted. The Board also decided to expand the Stryker EMS grant to include the Stryker Power-LOAD™system.

In previous years the Stryker EMS grant program included a 60/40 matching grant to assist our membership in purchasing a Stryker Power-PRO™ ambulance cot or a Stryker Stair-PRO® stair chair. That grant is still available. The expanded part of the grant which includes the Stryker Power-LOAD™ system and is set up to pay 33% of the list price. This will allow more members the opportunity to apply for the grant.

The second grant is in partnership with Stan Houston Equipment to assist members with the purchase of an ICS® Saw Package. The ICS® saw is very beneficial in reducing the risk of injury during activities that require the use of a chop saw, particularly to cut and repair broken water pipes in a confined space.

Eligibility for these grants is very simple. The applicant must be a member of the SDML WC Fund as of the date of the grant application and in the year the grant is awarded. Also, the member must meet several selection criteria, including compliance with loss control safety recommendations. The complete list of selection criteria is outlined in the application.

The SDML Workers’ Compensation Fund has always stressed the importance of using safety equipment and following safety procedures. There are many components to a successful safety program, beginning with leadership direction and support, which then flows to the supervisors and employees. We look forward to more participation in these programs and the reduction of injuries to your employees.

Both 2017 grant applications are available on our website at www.sdmlwcfund.com. If you have any questions please contact Brad Wilson or Ladene Bachtell at Insurance Benefits, Inc., 4901 S. Isabel Pl. #110, Sioux Falls, SD 57108; info@sdmlwcfund.com; 800-233-9073.

The Board of Trustees thanks all of you for the continued support you give to the SDML Workers’ Compensation Fund, your commitment to safety, to returning an injured employee back to work, for following your loss control Improvement Recommendations, and especially your continued membership with the SDML Workers’ Compensation Fund.

If you have any questions regarding this year end summary please call your Administrator, Insurance Benefits, Inc. at 800-233-9073 and ask for Brad Wilson or email him at brad@sdmlwcfund.com.

Brad Wilson, CIC, AIC, SDWCS SDML Workers’ Compensation Fund Fund Administrator- Insurance Benefits, Inc.