Administrative Services Proposed Rate Changes Fiscal Year 2020 Presented to the DAS Rate Committee September 12, 2018
DAS AS IS ISF Re Resp sponsi nsibil biliti ities es Utah Code Section 63A-1-114 (2018) A DAS division that operates as an internal service fund (ISF) shall • submit to the DAS rate committee a proposed rate and fee schedule for services rendered to an executive branch entity or an entity that subscribes to services rendered. DAS provides staff services to the committee. •
DAS AS Ra Rate te Com Commi mittee ttee Re Resp sponsibili onsibilities ties Utah Code Section 63A-1-114 (2018) Conduct meetings in accordance with OPMA; • Meet at least once each calendar year to: • discuss service performance; • review the proposed rate and fee schedules; • approve, increase, or decrease the rate and fee schedules; and • discuss any prior or potential adjustments to the service level received by • state agencies that pay rates to an Internal Service Fund (ISF); Recommend ISF rates to GOMB and the Legislature, and • Review and approve interim rates. •
DAS AS Mi Miss ssion ion Deliver support services of the highest quality and best value to government agencies and the public
DAS AS Vis Visio ion Be the preferred and most trusted provider of products, services, and innovative solutions to meet customer needs
DAS Programs Department of State Building Administrative Services Board Facilities Administrative Archives & Fleet Purchasing & Risk Construction & Finance Rules Records Service Operations General Services Management Management Administration Building Official Payroll Motor Pool Purchasing Administration Archives Mail & Construction Accounting Research Fuel Network Distribution Claims Management Operations Center Services Energy Purchasing Processing State Travel Print Services Loss Control Efficiency Card Program Financial Information Transactions Surplus Facilities Information Preservation Systems Team Property Management Systems Records Financial Real Estate Analysis Reporting Not Under DAS Supervision: Finance Office of the Inspector General of Medicaid Services • Mandated Independent Executive Branch Ethics Commission • Office of State Political Subdivision Ethics Review Commission • Records Center Debt Collection
Ri Risk sk Ma Management nagement Lia iabili bility ty Prop oper erty ty Au Auto Worker kers s Co Comp mpen ensation sation Learni arning ng Managem ement ent Sy System tem Finance Facilities Construction and Management Fleet Operations Purchasing and General Services
Ris isk k Man anageme agement nt Utah Code Title 63A, Chapter 4, “Risk Management” Mandates the appointment of a Requires economically and actuarially Risk Manager and establishes sound management and adequate the Risk Management Fund reserves for the payment of reported, unpaid, and unreported claims Risk Management | Overview
In Insu surance rance Risk Management has some advantages over traditional insurance providers Broader coverage Pool members share the for less money impact of rate increases Risk Management | Overview
Ra Rates tes Ca Can n Ch Change ange Increased claims costs Insurance market When claims roll off an from the past year changes agency’s 5 -year history Risk Management | Overview
Li Liabil ability ity Pr Progr gram am Risk Management | Overview
Li Liab abili ility ty Re Reta tained ined Earni arning ngs s (H (Histor istorical) ical) $9M $7M $5M $3M $1M -$1M -$3M -$5M -$7M FY2007 FY2008 FY2009 FY2010 FY2011 FY2012 FY2013 FY2014 FY2015 FY2016 FY2017 FY2018* preliminary Net Income Retained Earnings 60 Days Operating Capital Risk Management | Liability Insurance | Retained Earnings
Lo Loss sses an es and Pr d Premi emiums ums School l Distr trict* ict* Liab iabilit ility y – per Pupil il Count UDOT T Liability ability – per 100 Lan ane Miles es Higher er Educa catio tion Liab iabilit ility y – per Pupil il Count Oth ther er Agenc encies ies Liab iabili ility ty – per 1K in Popula latio ion *School Districts include Charter Schools. Risk Management | Liability Insurance
Li Liabil ability ity Re Reser serve ve Sta Statu tus Actuarial Projection $54,407,000 $(5,126,517) Balance $49,280,483 Risk Management | Liability Insurance
Ho How W w We Go e Got Her t Here • Unprecedented increase in liability claims • Lag time between actuarial projections and loss experience • Conservative projections to keep rates low and stable to minimize retained earnings Risk Management | Liability Insurance
Li Liabil ability ity Ra Rate In te Incr crease/ ease/Allo Allocatio cation Liability premiums will Individual entities will have increase by $6,895,101 increases or decreases in FY2020 based on loss history and risk exposure Risk Management | Liability Insurance
Li Liabil ability ity Re Reta tain ined ed Ea Earnin rnings gs $6M $4M $2M $M -$2M -$4M -$6M -$8M -$10M -$12M -$14M FY2015 FY2016 FY2017 FY2018 FY2019 FY2020 FY2021 preliminary projected projected projected Net Income Retained Earnings 60 Days Operating Capital Risk Management | Liability Insurance | Retained Earnings
Li Liability ability Premiums emiums by Ris y Risk k Poo ool Re Re-cap capturin uring g Hist storic rical l Loss sses Rate Recommendation Premium Projections (Numbers in Thousands) Premiu miums ms Change ange Risk k Pool FY2019 FY2020 T otal al Per erce cent nt School Districts & Charter Schools $7,824 $11,216 $3,392 43.4% Department of Transportation $2,557 $3,494 $937 36.6% Higher Education $3,103 $4,755 $1,652 53.2% Other Agencies $5,700 $6,613 $914 16.0% T otal al $19,18 184 $26,078 078 $6,895 95 35.9% Risk Management | Liability Insurance | Rate Changes
Pr Prope perty ty Pr Prem emiu iums ms Property premiums will Valuation, square footage, and CPI changes will affect the amount of premium collected increase by $961,400 in for all agencies with property coverage FY2020 Risk Management | Property Insurance
Pr Prope perty ty Re Reta tain ined ed Ea Earnin rnings gs $6M $5M $4M $3M $2M $1M $M -$1M -$2M -$3M FY2015 FY2016 FY2017 FY2018 FY2019 FY2020 FY2021 preliminary projected projected projected Net Income Retained Earnings 60 Days Operating Capital Risk Management | Property Insurance | Retained Earnings
Pr Prope perty ty Pr Premi emiums by ums by Ri Risk sk Pool Rate Recommendation Premium Projections (Numbers in Thousands) Premiu miums ms Change ange Risk k Pool FY2019 FY2020 T otal al Per erce cent nt School Districts & Charter Schools $8,448 $8,393 $(55) (0.7)% Higher Education $5,307 $6,276 $969 18.3% Other State Agencies $3,540 $3,588 $48 1.4% T otal al $17,29 295 $18,25 257 $962 962 5.6% Risk Management | Liability Insurance | Rate Changes
Au Auto to Pr Premi emiums ums Auto premiums will increase Individual entities will have increases or decreases based on slightly in FY2020. Rates will now loss history and risk exposure be calculated by an actuary. Risk Management | Automobile Insurance
Aut Auto Phy o Physi sical cal Da Dama mage ge Ra Rate te Ch Chan ange ges Curr rrent nt Schema ema Other r Vehicl cles es or Value e < Relate ted d Value e > $35,000 00 Risk k Pool $35,000 School ool Bus Equi uipm pment nt (per $100 0 of value) e) Public Safety $175 $0.80 $200 $75 Higher Education $125 $0.80 $200 $75 Other State Agencies $150 $0.80 $200 $75 Charter / School Districts $50 $0.80 $200 $75 Proposed oposed Schema ma Car / T Truck ck Bus Sem emi-Truc ruck Trac actor tor Weight: 1.0 1.5 5.0 1.0 FY2020 Rate: $116.25 $174.37 $581.25 $116.25 Risk Management | Automobile Insurance
Auto Au to Re Reta tain ined ed Ea Earning rnings $600K $400K $200K $K -$200K -$400K -$600K FY2015 FY2016 FY2017 FY2018 FY2019 FY2020 FY2021 preliminary projected projected projected Net Income Retained Earnings 60 Days Operating Capital Risk Management | Automobile Insurance | Retained Earnings
Au Auto to Ph Physical ical Damage age Pr Premiums miums by Ri Risk k Poo ool Rate Recommendation Premium Projections (Numbers in Thousands) Premiu miums ms Change ange Risk k Pool FY2019 FY2020 T otal al Per erce cent nt School Districts & Charter Schools $916 $1,008 $93 10.0% Higher Education $299 $328 $24 9.7% Other State Agencies $935 $1,078 $105 15.3% T otal al $2,150 50 $2,414 14 $222 222 12.3% Risk Management | Automobile Insurance | Rate Changes
Wor orker kers s Co Compensation mpensation Ret etained ained Ea Earnings nings $6M $4M $2M $M -$2M FY2015 FY2016 FY2017 FY2018* FY2019 FY2020 FY2021 preliminary projected projected projected Net Income Retained Earnings 60 Days Operating Capital *$2.5 million was transferred to Liability ($2.4 million) and Auto ($100,000) to help reduce the impact of premium increases. Risk Management | Workers Compensation | Retained Earnings
Recommend
More recommend
