ARECA Insurance Exchange

clappergappawpawUrban and Civil

Nov 16, 2013 (3 years and 4 months ago)

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ARECA Insurance Exchange
Board of Trustees


2009 Annual Meeting


Year in Review


Presented by Marilyn Leland, Exec. VP

ARECA Insurance Exchange

What will be covered



Financial report



Underwriting report



Claims report



Loss Control report

ARECA Insurance Exchange

Financial Report


2008 admitted assets of $20.2M, a decrease
of $2.6M from 2007.


$13.5M in policyholders’ surplus at the end of
2008, down from 2007 by $4.3M.


Surplus allocated to policyholders was
$1,267,284, which was down from the prior
year by $961,685 due to unfavorable losses
and investment returns reported in 2007.

AIE Income
1998-2009 Year to Date
-$4,000,000
-$3,000,000
-$2,000,000
-$1,000,000
$0
$1,000,000
$2,000,000
$3,000,000
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
Net Underwriting Gain (Loss)
Net Investment Gain (Loss)
Total Other Income
Net Income
ARECA Insurance Exchange

Financial Report

AIE ended 2008 with a net loss of ($2,880,606) vs. income of
$1,084,546 budgeted: a $3,965,152 variance for the year.
Variances:



Premiums written decreased slightly to $5.7M (2008) from
$6M (2007), $261,929 less than budget.



Reinsurance was approx. $40,000 less than budget.



Investment and other income was approx. $1,451,868


less than budget.



Loss expense was $2,930,031 higher than budget.



We had total losses of $6,022,030.

AIE Net Losses Incurred
1998 to 2009 Year to Date
$0
$500,000
$1,000,000
$1,500,000
$2,000,000
$2,500,000
$3,000,000
$3,500,000
$4,000,000
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
Net Losses Incurred
ARECA Insurance Exchange

Financial Report


2009 dividend payments totaled $0 compared to
$381,699 for 2008.

Historical:


Income allocated to policyholders since inception is
$32,598,668.


Total surplus paid to policyholders since inception is
$19,018,493.


The 10
-
year average surplus paid to policyholders
is $1,302,234.

Surplus and Dividends
1998 to 2009 Year to Date
$0
$2,000,000
$4,000,000
$6,000,000
$8,000,000
$10,000,000
$12,000,000
$14,000,000
$16,000,000
$18,000,000
$20,000,000
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
Dividend Payments
Surplus
Contributions of Surplus to Subscribers
ARECA Insurance Exchange

Underwriting Report

Subscriber update



Gained new subscriber: MEA



Lost one subscriber: CVEA



Marketing for new members








ARECA Insurance Exchange

Underwriting Report

Policy update

Property


Continuing to refine the new policy


increase policy sublimits


add margin clause





ARECA Insurance Exchange

Underwriting Report

Policy update

Casualty



Attach EMF (Electromagnetic Fields)


exclusion

ARECA Insurance Exchange

Underwriting Report

Forecast for 2010 rates



Workers’ Compensation (NCCI)



Property



Casualty

ARECA Insurance Exchange

Underwriting Report

Reinsurance

Update on pricing projections for 2010



Property



Casualty

ARECA Insurance Exchange

Claims Report 2008
-
2009



Claims update


One boiler loss in 2008, none in 2009


No property losses


2005 liability incident in litigation


No major work comp injuries in 2009


AK Fee schedule extended by legislature
through 2010

ARECA Insurance Exchange

Claims Report 2008
-
2009




Mandatory MMIR Section 111


Medicare (Center for Medicare Services)


Mandatory reporting of Medicare eligible
beneficiaries with open claims on quarterly basis


Register by August 30, 2008


Query database for Medicare claimants


Quarterly reports due April 1, 2010 forward

ARECA Insurance Exchange



Claims Report 2008
-
2009


Claims trends

2002
--
218

2003
--
190

2004
--
195

2005
--
209

2006
--
174

2007
--
168

2008
--
178

2009
---
86 (through 7/09)

ARECA Insurance Exchange
Claim Numbers By Policy Line
2000-2009
0
20
40
60
80
100
120
140
160
180
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
Auto
Gen Liab
Prop
Work Comp
ARECA Insurance Exchange
Incurred Losses by Policy Year 2000-2009
0
1000
2000
3000
4000
5000
6000
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
Work Comp
Property
General Liability
Auto Liability
ARECA Insurance Exchange

Loss Control update



Property valuations/schedules



Catastrophic modeling



Property surveys



Machinery inspections



Jurisdictional inspections



Workers’ Compensation modification


factor

0
0.2
0.4
0.6
0.8
1
1.2
1.4
Experience Modification Factor

(Industry Average is 1.00)

AIE Member Utilities

Worker Compensation Experience Modification Factors

All Exchange Members 2008

ARECA Insurance Exchange

NRECA Safety Accreditation



Purpose and process



Frequency and severity



Management and application



2009 Accreditation



Naknek Electric Association



2010 Accreditations



Homer Electric Association



Chugach Electric Association