What is Risk Management?

Transcription

1 Risk Management Workshop 1

2 What is Risk Management? It is the identification, assessment, and prioritization of risks followed by coordinated and economical application of resources to minimize, monitor, and control the probability and/or impact of unfortunate events. Wikipedia

3 Risk Management Division The Division manages the self insurance program which provides a system through which Manatee County can protect its assets, comply with applicable legal requirements, and meet its liabilities under state and federal law. This includes the retention of risk for claims including General Liability, Auto Liability, and Workers Compensation. 3

4 Risk Management Division Cont d The Division identifies, and pursues, subrogation opportunities for recoveries from third parties. The Division researches, negotiates, and recommends to the Board commercial insurance for purchase, to cover against catastrophic loss. The Division establishes Safety Policy along with the Safety Coordinators from Public Works and Utilities. The Division provides, or assists, with loss control activities through site inspections and training. 4

5 What is considered when Risk is identified? Risk Avoidance: Can we eliminate the exposure entirely? NO The only way to eliminate risk is to cease operations. Risk Retain: Paying out of pocket, self insure? Risk Transfer: Transfer of risk to another party? Hybrid Plan: Manatee County utilizes this strategy 5

6 Self Insurance: What does it mean and how does it respond to claims? It provides coverage in the same manner and to the same extent as though commercial insurance was in place. It provides a means to compensate persons injured by acts or omissions of County employees for which Manatee County has liability. 6

7 What types of insurance coverage does the County purchase and why? 7

8 Types of Coverage Excess Property (covered perils include Fire, Flood, Named Storm and others) Excess Liability Workers Compensation Primary Flood on select properties Others: Lake Manatee Dam, Boiler and Machinery, Crime, CSX General Liability (9 agreements), Equipment Rental Blanket Policy. 8

9 EXCESS PROPERTY* VISUAL STRUCTURE $250,000,000 Total Loss Limit $60,000,000 Named Storm Limit $7.5 million $7.5 million $5million Deductibles: $100,000 Per Occurrence, all perils except Named Storm Wind/Flood/Hail 5% per affected building Minimum $250,000 *Property includes buildings, lift stations, vehicles, and equipment. $5 million Notable Sublimits: Named Storm [wind]: $60,000,000 Flood: $50,000,000 Debris Removal: Included Extra Expense: $50,000,000 Landscaping: $5,000,000 9

10 Excess Liability, Auto & Excess Workers Compensation Excess General/Professional Liability: $2,000,000 limit per occurrence per claim and $4,000,000 annual aggregate per 12 month term for all claims Excess Public Officials Liability, Employment Practices Liability, and Sexual Abuse Liability: $1,000,000 per occurrence per claim and $2,000,000 annual aggregate per 12 month term for all claims. Excess Automobile Liability: $2,000,000 combined single limit. Excess Workers Compensation Limit: Statutory. Excess Employers Liability Limit: $1,000,000. Clash Coverage : In the event that two or more coverages are triggered, only one retention will apply (potentially saves the County hundreds of thousands of dollars in the event of major claims). 10

11 How is Risk Management Funded? Internal Service Fund Fund created for serving other funds or departments within a government Functions on a cost reimbursement basis Fund collects all revenue from departments and pays expenditures for the fund Presented annually during Budget Worksessions and adopted within the Budget Process 11

12 How do we fund Risk Management? Department Department Self Insurance Internal Service Fund Department Department All departments of the County participate in the program. The departments make payments to the Self Insurance fund. Payments are based upon actuarial estimates of amounts needed to pay prior and current year claims. 12

13 What is the cost to operate Manatee County s Self Insurance Program? $9,388,440 is the Adopted Budget for FY 14 Administration Workers Compensation Auto Property & General Liability 13

14 FY 14 Budgeted Expenditures for Liabilities $2,782,000 Workers Compensation claims $641,000 Auto Liability claims $580,000 General Liability & Property claims $4,003,000 TOTAL (roughly 43% of program costs) 14

15 FY 14 Adopted Budget for Commercial Insurance Premiums $214,000 Workers Compensation $107,000 Auto Liability $4,053,231 Property and General Liability $4,374,231 TOTAL (or 47% of program costs) $1,011,209, or only 10% of program costs, lie outside claim costs and insurance premiums. Includes staff salaries, attorney fees, Third Party Administrator (TPA), and other miscellaneous expenses. 15

16 FY 12 Top 5 Dpts Total Claims Workers Compensation FY 13 Top 5 Dpts Total Claims Workers Compensation FY 12 Total Claims All Dpts 224 FY 13 Total Claims All Dpts

17 FY 12 Top 5 Departments WC Total Claim Costs FY 13 Top 5 Departments WC Total Claim Costs 1,200, ,000, , , , , ,400, ,200, ,000, , , , , FY 12 Totals all Dpts $2,390,301 FY 13 Totals all Dpts $2,396,721 17

18 FY 13 Auto Top 5 Number of Claims Closed by Dpt/Dvsn $350,000 $322,633 $300,000 $250,000 $200,000 $150,000 FY 13 Auto Top 5 Claims Closed Cost by Dpt/Dvsn $100,000 $50,000 $ $54,877 $17,993 $13,924 $7,149 Total Claims in FY 13 was 267 Total Cost for FY 13 was $586,755 18

19 Questions? 19