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MEETING MINUTES 062105 MEETING MINUTES: New Hanover County Finance Office – Risk Management BUSINESS: Review and discuss renewal information for New Hanover County Board of Education, New Hanover County, Cape Fear Public Transportation, City of Wilmington, Housing & Economic Opportunities, Inc., New Hanover County Airport Authority, Southeastern Center for MH/DD/SAS and the Housing Authority of the City of Wilmington, and the marketing strategy of 2005-06 accounts. TIME AND PLACE: June 21, 2005 9:00 a.m. New Hanover County Library – Main Branch Cape Fear Room Wilmington, NC 28401 ATTENDANCE: Those in attendance were George Chadwick III, Charlotte Hicks, Walker Taylor IV, Deborah Watts, Risk Manager Brown, Risk Management Specialist Allen, and Bruce Shell-New Hanover County Finance Director. Special Guests in attendance were Randy Reeves of Harold W. Wells & Son, Inc. and Ray Sawyer of National Benefits America; Yogi Wright of Surry Insurance and Brian Reeve, John Rabon, and Robert Harris of Key Risk; Robin Hamilton, New Hanover County Board of Education Human Resources Director and Kay Swain, representing the New Hanover County Board of Education Benefits Supervisor. ORDER OF BUSINESS: Risk Manager Anne Brown first welcomed all members and guests and directed everyone’s attention to the meeting materials, which included an Agenda, Minutes of the February 16, 2005 meeting, and renewal, marketing, and claim data for various entities. Although minutes approval is not required, as a precaution, Risk Manager Brown asked each member to review the Minutes of the February 16, 2005 meeting and advise of any corrections or additions of which there were none. Risk Manager Brown advised the Committee that the Risk Management Department sought coverage for the New Hanover County Board of Education’s Workers’ Compensation coverage for the first time. The Risk Management Department sent Request for Proposals for Workers’ Compensation Insurance to Harold W. Wells & Son, Inc, Walker Taylor Agency, Woodbury & Company, and Surry Insurance and two proposals were received. Surry Insurance and Harold W. Wells & Son, Inc. made their presentations to the Committee. Risk Manager Brown continued by explaining the Workers’ Compensation insurance for the Board of Education is unique because some employee’s salaries are funded by local and state funds; therefore, two insurance companies are involved in the claim process – the Board of Education’s insurer (local funds) and the State’s third party administrator (state funds). In the event of injury to a dually funded employee, the State’s third party administrator, Key Risk Management, processes the claim then sends the New Hanover County Board of Education’s Workers' Compensation Insurance Company a billing for their pro-rata share of the claim expenses. The New Hanover County Board of Education’s Insurance Carrier is at a disadvantage because they have no control over the settlement of a claim for a local and state funded employee. Risk Manager Brown prefaced the presentation by Harold W. Wells by explaining their quote is with National Benefits and the North Carolina Rate Bureau. Risk Manager Brown introduced Randy Reeves of Harold W. Wells & Son, Inc. who provided information on the history of his agency as well as the services they provide which entails a risk reduction approach to managing insurance exposures. The Harold W. Wells & Son website is a comprehensive tool for employers that include easy access to OSHA logs. Mr. Reeves introduced Ray Sawyer of National Benefits America who provided background information for NBA including their expertise in Workers’ Compensation claims since that is their sole mission. NBA’s repertoire includes other Board’s of Education and governmental agencies. Loss prevention is the key focus of NBA. Part of their plan includes an initial assessment of the BOE and development of a risk management plan to prevent claims. Risk Manager Brown asked if NBA provides complementary training to which the answer was yes. In addition, Mr. Sawyer advised NBA’s training sessions includes testing, which confirms comprehension. Member Watts asked what the criterion is for face-to-face contact with an adjuster. Mr. Sawyer advised that their normal procedure is to take the employee’s recorded statement by phone and to follow up by phone. Face-to-face contact with a claimant is rare. Additionally, Member Watts asked if NBA offers guidance in returning the employee to work and if they have a local person to help in the process. Mr. Sawyer advised the terms for returning to work is determined through the adjuster and the insured, but did not specify if there was a local person to aid the process. Member Chadwick asked if NBA understands the terms of split funding to which his answer was yes. Mr. Sawyer added since the North Carolina Rate Bureau quote is contingent on the experience modification factor and is likely to change; NBA will use credits or debits to hold the premium to the amount quoted. Mr. Sawyer added that in addition to setting up an early return to work program, that the NHC Board of Education is required to create a Safety Committee. Risk Manager Brown thanked Randy Reeves of Harold Wells & Son and Ray Sawyer of National Benefits of America for their presentation. Risk Manager Brown welcomed and introduced Yogi Wright of Surry Insurance, who is the agent of record for the New Hanover County Board of Education’s Auto Liability, Excess Auto Liability, and Garage Liability policies. Mr. Wright briefly highlighted the attributes of his agency, which includes twenty years of experience servicing school systems, then turned the presentation over to Brian Reeve, Territory Marketing Manager of Key Risk. Brian Reeve presented a brief history of Key Risk including the fact that Key Risk is the Third Party Administrator for the North Carolina Public School System and has insured school systems since 2001. Mr. Reeve referred the Committee to their packet of information, which details the technology capabilities, claims cost containment, and proactive loss control services available through Key Risk. Robert Harris of Key Risk advised the committee that if the Board of Education chose their company, then they would have a dedicated adjuster with formal oversight by a supervisor. All Key Risk employees are required to return phone calls the same day or at least within 24 hours. Contact includes a three-point approach – contact with the employee, employer, and physician. John Rabon of Key Risk Client Services added that he brings to the Board of Education fifteen years of claims experience. Key Risk updates their loss runs each weekend, which the Board of Education can access any time. Mr. Rabon added that their system is used for the first report of injury. Yogi Wright and the representatives of Key Risk referred attendees to the eight conditions outlined in the proposal. Mr. Wright reiterated that the Board of Education must comply with the following eight conditions: a safety inspection, implementation of a safety program, creation of a safety committee, implementation of a return to work program, use of the Key Risk claim kit, cooperation with Key Risk in the investigation of claims, distribution of fraud information to all employees, and a statement explaining the coverage for acts of terrorism. Mr. Wright and John Rabon volunteered to visit the Board of Education as often as needed to assist them in creation and implementation of a safety program and safety committee. Yogi Wright added that Key Risk based their quote on an l.00 experience modification factor and will use credits or debits to offset the difference should the North Carolina Rate Bureau deem the factor is higher or lower. Member Watts asked what Key Risks procedures are for fraud? The representatives of Key Risk responded that they have a specialist to work on fraud cases which involves surveillance. Key Risk also refers cases to state authorities such as the Attorney General and Industrial Commission. Risk Manger Brown thanked Yogi Wright and the representatives of Key Risk for attending the meeting and making their presentation. The Risk Management Committee discussed the merits of both companies and concluded that Key Risk is the better choice due to service capability of their staff (26 nurse case managers, as opposed to 1 at NBA), their ranking as the top writer of Workers’ Compensation in North Carolina, and their proposed premium. Risk Manager Brown referred the Committee to New Hanover County’s insurance premium spreadsheet on page two of the handout. Member Taylor and Member Hicks commented that the premium savings for increasing the property deductible from $25,000 to $50,000 was worthwhile. Risk Manager Brown reviewed the Excess Workers’ Compensation spreadsheet on page 22 of the handout and explained the policy was renewed for one year since there is no premium savings for purchasing a two-year policy. The major differences are that the County’s payroll increased 4.7 million over the prior year and the Estimated Aggregate Retention increased. The County chose to take the higher premium in order to keep the lower retention of $300,000. Risk Manager Brown discussed the New Hanover County Health Department’s Medical Professional Liability policy renewal through ACE Medical Risk. The total premium of $14,353.72 is a slight increase over the 2004-05 policy term. Risk Manager Brown referred the Committee to the Cape Fear Public Transportation Authority spreadsheet on page 33. The policy will renew on 07/01/05 with the North Carolina Association of County Commissioners. The Committee reviewed the premiums and deductibles with and discussed the 7% increase of premium. Risk Manager Brown advised the City of Wilmington will renew their Workers’ Compensation Insurance policy with Midwest Employers Casualty Company on 07/01/05 as per expiring terms as detailed on page 44 of the handout. Risk Manager Brown referred the Committee to page of 48 of the handout and discussed the renewal of the Housing and Economic Opportunities, Inc. on 07/01/05 with the North Carolina Association of County Commissioners. Risk Manager Brown stated the New Hanover County Airport Authority policy would renew with the North Carolina Association of County Commissioners on 07/01/05 for a premium of $145,954 as detailed on page 54 of the handout. Risk Manager Brown referred the Committee to page 64 of the handout and advised the New Hanover County Board of Education’s Automobile Liability, Garage Liability, and Excess Automobile Liability will renew with Utica National Insurance Companies for $110,351. Risk Manager Brown referred the Committee to page 68 of the handout and advised the renewal for Southeaster Center for Mental Health, Developmental Disabilities, and Substance Abuse Services renewed with the North Carolina Association of County Commissioners; however, she is still negotiating with NCACC regarding the premium charge for Public Official’s Liability. Risk Manager Brown advised the New Hanover County Risk Management Committee non-renewed their Contract to provide services to the Housing Authority of the City of Wilmington effective 07/01/06 and helped them in the transition to the North Carolina Housing Authority Risk Retention Pool. Risk Manager Brown asked if there were any other items of business to be brought before the Committee. There were none and the meeting was adjourned.