Sherburne County taxpayers are saving lots of money because of lower insurance premiums for county employees.

 

Kevin Balfanz of the Minnesota Counties Intergovernmental Trust (MCIT) gave a report  to the county commissioners last week.

 

MCIT is a joint powers entity where members pool resources to provide property, liability and workers’ compensation coverage. MCIT has 81 of 87 Minnesota counties as well as 388 associated members, such as soil & water conservation districts, county fairs and lake improvement districts.

 

MCIT uses contributions from each entity to provide its members with cost-effective coverage. As a public entity, MCIT is not accountable to shareholders to make a profit.

 

MCIT was formed in the late 1970s. Sherburne County became a member in 1990 and has benefitted from the pooling of resources.

 

Since 2010, aggregate rates have decreased 30.8% for property/casualty coverage and 32.1% for workers compensation coverage.

 

“That has to do with not only the ability to get re-insurance at competitive rates,” said Balfanz, “but also about our members’ ability and dedication to preventing losses, which ultimately  means we need to collect less to pay the potential claims.”

 

Because of its success, MCIT can return dividends to its members based on past claim experience and the performance of its investments.

“We have been fortunate to be able to return a dividend for the past 28 years,” said Balfanz.

 

The total dividend returned in 2018 was $11.75 million. Sherburne County received $292,614.

 

Actual premiums for the county have also decreased for workers compensation.

 

Premiums are calculated using a modification multiplies. That multiplier is based on the frequency and severity of claims over a three-year period. A 1.0 is what actuaries determine to be the average. Higher than 1.0 means higher premiums. Lower than 1.0 means savings.

 

Since 2015, the multiplier in Sherburne County has been dropping. In 2018 it was 0.77. This year, it’s 0.712. That’s a direct result of fewer and less-expensive workers’ compensation claims.

 

“That means the county paid 30% less for workers compensation coverage based on past claim experience,” said Balfanz. “And that means it will benefit the county moving forward.”