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Why it Works, How it Works, and What’s in it for you Kathy Johnson, Risk Mgmt. Strategies

The Wisconsin Educators Risk Management Co-op WERMC. Why it Works, How it Works, and What’s in it for you Kathy Johnson, Risk Mgmt. Strategies Erin Green, Greendale School District. What Is Needed. Interested Carriers Competition between carriers is key

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Why it Works, How it Works, and What’s in it for you Kathy Johnson, Risk Mgmt. Strategies

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  1. The Wisconsin Educators Risk Management Co-op WERMC Why it Works, How it Works, and What’s in it for you Kathy Johnson, Risk Mgmt. Strategies Erin Green, Greendale School District

  2. What Is Needed • Interested Carriers • Competition between carriers is key • Underwriters often don’t like “pools” • Some carriers don’t like groups • Carriers don’t like having to take all districts • Carriers who’ll give extra service and/or savings • Carriers’ coverage & claims philosophy that “fits”

  3. 2. Carriers-What Makes a Carrier Interested? • Opportunity for profitability Up-front savings short-lived if losses don’t support the premiums “Soft” or “hard” market drives pricing and service • Insuring districts that have the “right” attitude • Pricing each district independently

  4. 3. Coverages Included • Casualty: liability and Workers’ Compensation • Other coverages-any carrier • Crime • Property • Boiler • Pollution for storage tanks • Cyber Liability

  5. 4.Membership of Districts Who • are interested in “joining” • are interested in saving money • are committed to long-term service and savings • are willing to do Best Practices • will attend meetings to learn from speakers and each other • will share concerns and what they learn • want to learn how to do “it” better • And Biz Managers who are willing to serve

  6. Pros and Cons of a Co-op

  7. Advantages to School District • Safety consultant assigned to your district • Possible discounted attorney rates • Informational seminars/training • Ability to receive liability premium discount • Risk consultant’s assistance with issues and purchase/renewal of insurance • Power in numbers (negotiate “extras”) • Resources to make your job easier

  8. To Get Buy In: • Do an annual risk management report to the board to provide education, while considering or after joining • Stress the buying power of 35 districts= $4.5 M of premium vs. small district on own • Point out possible gaps if insurance not the best available • Point out areas of possible large losses, such as labor law issues , W/C --needing expertise • Stress this is “proactive” management of risks

  9. A Co-Op: Consider This • Look at the stability of the premium (liability/E &O) over time with chosen carrier • Consider “extras” carrier will provide due to power of premium or usual practices • Look at short term gain (one year premium savings on bid) vs. long-term stability of premium/comprehensive coverages and services • We are all busy…so… put effort where the payoff is, which you will learn thru a co-op’s resources and education

  10. A Co-Op Offers Value: • Ensures broad coverage and “extras” • Ensures limits adequate for the exposure • Long-term plan for best pricing and risk management Best Practices • W/C: Creative dividend structure related to loss history to ensure longevity

  11. District Realities • Political or relationship realities with agents/carriers • Perceived competition with a “recommended” carrier • Complexities of Biz Officials understanding commercial lines of insurance (apples to apples) • Difficulty of explaining complexities to Superintendent/Board

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