AG 2002 12 16 (Regular) - Laserfiche WebLink

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ICARARRUS COUN~I NORTH CARH.INA MEMORANDUM To: Board of Commissioners From: Date: Blair Bennett ~ November 27, 2002 Subject: Status Report on Liability and Property Insurance Fund The decision was made beginning July 1, 1997 to become self-insured for Liability, Property, Bonds, Professional Liability and Boiler Insurance. We set up a special corporation, known as Carolina Governmental Alliance, which has it's own articles of incorporation, in which to administer this particular type of insurance coverage. Currently Rowan County is the only other member, but we can allow other counties to participate. Each county is ultimately responsible for their own claims; however, we administer and track expenses and revenues through one bank account. We meet quarterly with our consultants to review claims and study current issues. Please notice in the compilation below that actual claims paid for the fiscal year amounted to $109,793.07. These payments were allocated back to the particular year in which the claim actually occurred. Those allocations were as follows: 1998 - $1,813.10, 1999 - $3,447.50, 2000 - $15,148.76, 2001 - $13,561.16 and 2002 - $75,822.55. The FY 1998 indicates a saving loss, but that is only because of the timing of the claim. The County had a jail related claim in 1998 that resulted in a general liability payment of $374,903.63. The County was only responsible for $50,000 of that claim, however we did not receive insurance reimbursement in the amount of $324,904 until 2000. Since we report claims paid against the actual year the claim first occurred; that caused what appears to be a saving deficit for the claim year. Our other major expense is excess insurance, amounting to $238,512 for the current year. This is purchased to protect the pool from catastrophic loss. Please notice that we now have a cash balance reserve amounting to $1,648,827.83. Considering we have only had five years of operations using the self-insurance fund this has certainly been financially beneficial for Cabarrus County. Compensation Claims Solutions, our claims administrator, located here in Concord, has done an excellent job of actively working and monitoring the claims. Also, Everette Arnold, our insurance consultant, has been invaluable by offering advice and experience from his years of being in the self-insurance business advisory capacity. We will continue to monitor this fund and its claims closely, and hope that its success will continue. Finance Department P.O. Box 707 · Concord, NC 28026-0707 ° 704-920-2104