M UNICIPAL L IABILITY T HE E VER -C HANGING W ORLD OF R ISK AND L OSS C ONTROL This session will explore the impact of risk and loss amongst AMRRP members.

MUNICIPAL LIABILITY

THE EVER-CHANGING WORLD OF RISK AND LOSS CONTROL

This session will explore the impact of risk and loss amongst AMRRP members and how you can lessen

their impact in your municipalities.

ICMA Practice Areas: 2, 3, 11, 12, 13

Page 2

Why should I care?• Loss effects the entire Pool

• Losses effect the potential for dividends

• Loss effects the city or town• Losses effect premiums

• Loss effects the City or Town Manager • Losses reflect poorly on you

Page 3

What is AMRRP (the Risk Pool)?• Self-insurance for municipalities

• 76 Arizona municipalities band together to offer effective insurance coverage

• How is AMRRP funded?• By member premiums

• Why is AMRRP different from other insurance?• Tailored Coverage• Special coverage and services• Personal service

Page 4

Coverage lines• Property, Casualty & Liability (P&C)

• Examples:• General liability

• Bodily injury, property damage• Auto

• UM, UIM, Collision, Comprehensive, Liability• Property

• Building and contents• Professional liability

• Personal injury• Governing body decisions

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Coverage lines• Worker Compensation (WC)

• Examples:• Employee injuries

• On duty• Public Safety

• Employee fatalities• On duty• Public safety

• Medical• Short-term• Long-term

• Lost wages• Loss of earning capacity

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Significant P&C exposures• Employment

• Failure to follow due process• Failure to document• Arbitrary and capricious• Hiring or not hiring

• Council action• Interference with staff• Land use decisions• Policy, Statute or Ordinance neglect

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Significant P&C exposures• Driving

• Inattention• Phones, Texting, Navigational devices, eating

• Unique to Emergency Services• Radios, Consoles, MDT’s, Phones

• Fatigue• Overtime / Shift changes• Illness / other stressors

Page 8

P&C claim mitigation• Employment resources

• Personnel Assistance Lifeline (PAL)• Public Safety Assistance Program (PSAP)• HR Sentry (online policy templates)

• Council decision resources• Land Use Assistance Line (LUAL)• Equal Employment Opportunity Commission / Arizona Civil Rights

Division Position Statement Program (EEOC/ACRD)

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P&C claim mitigation• Auto

• Minimize distractions• Policies for multi-tasking while driving• Defensive driver training

• Fatigue• Policy options and accountability

• Emergency service distractions• Standardization of equipment

Page 10

Significant Work Comp exposures• Slips, Trips & Falls

• Inattention• Lack of safeguards

• Strains and Sprains• Inattention• Improper techniques / equipment• Short cuts

Page 11

Significant Work Comp exposures• Training injuries

• Lack of preparation• Lack of safety controls

• Safety officers• Safety rules

• Exercise injuries• Improper techniques• Insufficient supervision• Faulty equipment

Page 12

Work Comp claim mitigation• Slips, Trips & Falls

• Improve focus and attention• Inspect for hazards• Install safeguards

• Strains and Sprains• Improve focus and attention• Improve lifting techniques• Provide / use appropriate equipment• Eliminate short cuts

Page 13

Work Comp claim mitigation• Training injuries

• Stretch, warm up, train properly• Institute policies demanding safety control

• Establish and train Safety officers• Establish and comply with safety rules

• Exercise injuries• Stretch, warm up, train properly• Supervise organized activities• Remove faulty equipment

Page 14

Arizona Work Comp “Snapshot”

• Arizona loss ratio 123% 3rd worst in nation

• National avg. medical claim cost = $ 28,000• Arizona avg. medical claim cost = $ 42,500*

*Due to utilization and fee schedule

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Work Comp “Snapshot”• National claims breakdown

• 59% medical (treatment)• 41% indemnity (lost wages, loss of earning capacity)

• Western Region claims breakdown• 65% medical (treatment)• 35% indemnity (lost wages, loss of earning capacity)

• Arizona claims breakdown• 73% medical (treatment)• 27% indemnity (lost wages, loss of earning capacity)

Page 16

E-mods• Definition

• Comparison of payroll to claims based on an algorithmic formula

• Impacts• Premium changes based on this factor

• Changes• Lower claims = lower E-mods

Page 17

AMRRP’s priority

Reduce Work Comp

claims and exposures!

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Work Comp strategies• Employee injuries

• Directed Care• Initial (1st ) physician visit• Designated physician (WC orientation)

• Return to Work Policy• HR Sentry• Light Duty Job Descriptions

• Light duty (temporary assignment)• Flexibility• Reduces lost time claims and significantly impacts e-mods

Page 19

Work Comp strategies• Training

• Online, In-person, WebEx• Complementary to Pool members• Safety oriented• Interactive

• Safety audits • Annual or as needed• Facilities• Equipment• Job Safety Analysis

Page 20

Work Comp strategies• Safety Committees

• Usually comprised by supervisory staff• Trained and mentored by AMRRP staff• Reviews incidents and claims• Identifies causes• Oversees mitigation tactics• Can meet monthly, bi-monthly or quarterly• AMRRP staff can attend upon request

Page 21

Loss Control Action Plan

• Sets specific goals for loss reduction• Identifies specific causes of loss• Specifies mitigation resources• Requires action to reduce losses

Treat the disease, not just the symptoms!

Page 23

Administrative interaction• City/Town Manager reinforcement

• Develop a “safety-first” attitude• Support the Loss Control Action Plan

• City/Town Staff serve as primary contact• Understand the AMRRP program• Responsible for Loss Control Action Plan implementation

• AMRRP’s Loss Control staff• 1 Manager and 3 Consultants, including one Law Enforcement specialist

Page 24

Challenges• Avoidable claims

• High risk special events• Employment claims

• Rising medical costs • Work Comp claims never close in Arizona• Minimal use of Directed Care and Return to Work / Light Duty• Due to utilization and fee schedule

• Yarnell Hill Wildfire

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Questions

?

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www.amrrp.org

Loss Control

Eric DuthieLoss Control Manager

(602) [email protected]

Coverage/Policy

Ed BantelProgram Administrator

(602) [email protected]

Arizona Municipal Risk Retention Pool14902 North 73rd Street, Scottsdale, Arizona 85260

Main:(602) 996-8810 | Toll Free: (888) 309-4339