HomeMy WebLinkAboutMMIA Workers' Comp DividendMontana Municipal Insurance Authority
MEMORANDUM I1' !i' )rE JAN 2004
TO: MMIA Workers' Compensation Program Members ~
FROM: Paul Luwe, Chair
Bob Worthington, Chief Executive Officer
Alec Hanson, Executive Director MLC&T CiTY 0 F L/ .U R EL
DATE: January 27, 2003
RE: 2003 WORKERS' COMPENSATION PROGRAM DIVIDEND
On December 31, 2003 the Montana Municipal* insurance Authority (MMIA) completed its
eighteenth year of operation. The MMIA was created in response to .the non-availability of liability
insurance in the mid 1980's. While this is a true statement, the Liability Program encountered
difficulties sc the first Risk Retention Program created to assist Montana cities and towns was
the Workers' Compensation Program (WC).
Over the years, the WC industry has encountered numerous difficulties. The [ate. 1980's and
early 90's brought a "crisis" to all Montana workers' compensation insurers. Premiums increased
dramatically, and some insurers had significant unfunded liabilities. The MMIA, while not
immune to these difficulties, made adjustments and stayed financially sound through the "crisis".
A consortium of industry and government representatives worked together to create the MMIA to
address those problems. Through both legislative and administrative solutions, the "crisis" was
turned around for MMIA members. Premiums have significantly decreased, the assets and
financial surplus of the WC Program continue to increase, and we have returned $10.73 million
to the membership over the years.
As we look at the cun'ent workers' compensation market, we again see a troubled picture, in
many areas of the countw, the cost of WC coverage has skyrocketed and availability is limited.
The MMIA is not immune from these difficulties. Our costs continue to increase, especially for
medical procedures, and premiums for reinsurance have doubled in two years.
In the face of these difficulties the MMIA WC Program remains very strong. The Board of
Directors and staff are pleased to again share the financial success of the WC Program with the
membership. During the 2003 annual meeting, the Board voted to distdbuta $750~000 to the
membership. This distribution is made in accordance with the formula set forth in the Programs'
Membership Agreement.
Included with this letter is a check for your share of the distribution. We encourage you to include
this announcement, and a discussion of the MMIA, at the next meeting of your governing body.
The support you give the MMIA and the overall commitment to manage municipal exposures,
provides the opportunities for all to share in the Program's good fortune.
congratulations and thanks for your continued support.
Alec Hanse-n, Executive Director
~i~ Montana.>~....., ,, ~ League of Cities .~¢./LE and Towns ~,
, Clilef Execu Eve O i er (..~, -~,¢,44~,~
P.O. Box 6669, Helena, Montana 59604-6669 (406) 443-0907 In MT: 1-800-635-3089 Fax (406) 449-7440