Washington Counties risk pool executive warns of rising settlements, urges stronger county risk management

Chuck Boyd, executive director at the Washington Counties Risk Pool, told the Cowlitz County Board of Commissioners on Monday that rising jury awards and larger settlements have strained the pool's finances and that members must prioritize risk management and funding to weather the trend.

The presentation, given during a risk-pool workshop led by Shelley Pierce of Cowlitz County risk management, explained how the pool was formed to allow counties to jointly purchase liability and property coverages and to provide shared risk-management services. Boyd said the pool now serves 24 of Washington's 39 counties and that the organization's mission is "to provide comprehensive and economical risk coverage to reduce the frequency and severity of losses and to decrease the costs incurred in the management and litigation of claims."

Boyd told commissioners the pool's funding model and insurance market changes have pushed its self-insured retention from $100,000 when he started to $3 million per claim today, and that a string of large verdicts and social-inflation-driven settlements has reduced the pool's net position. "There is no way to sugarcoat that. We have had large claims," Boyd said, later adding that the pool expects to "hit the guardrail" in the current year under state solvency metrics and will need an infusion of funds or improved loss experience to avoid state intervention.

Why it matters: Boyd said the pool's solvency is not a certainty but is under pressure: actuarial guidance indicated a target net position materially higher than the pool's current balance, and Boyd said the board will consider assessment and rate decisions this autumn to address the shortfall. He noted that unlike commercial insurers the pool can use fund balance and member assessments to restore solvency, but that doing so requires timely board decisions and, in the long term, better risk management across member counties.

Boyd and Pierce described the pool's working programs and tools that counties can use to reduce claims costs: scholarships and training (including virtual and on-demand options), reimbursement programs for law-enforcement policy platform Lexipol (the pool reimburses 80 percent for members who meet an 80 percent implementation and training threshold), cybersecurity awareness reimbursement, a risk-reduction grant of up to $5,000 per county per fiscal year (with $3,000 available for any risk-management work and $2,000 targeted to committee-set goals), contract review and pre-defense review. Boyd said the pre-defense review program is free to members and that the pool budgeted more than $500,000 this year for that service because it is used heavily: "The predefense review program is setting things up for success," he said.

On claims patterns, Boyd identified law-enforcement and corrections matters as the largest source of recent large claims for member counties, noting juries and awards have increased statewide. He gave examples of recent large verdicts and settlements in the state and region to illustrate the scale: an employment trial that produced a $19.8 million verdict against a pool member and other high-profile awards he said are influencing plaintiffs' attorneys' settlement demands.

Boyd described the pool's insurance layers: a county-level deductible (Cowlitz County uses $100,000 per occurrence), the pool's $3 million self-insured retention, reinsurance up to $10 million and excess insurance to reach $20 million (some counties purchase an additional $5 million excess). He also summarized recent reinsurance market behavior, saying some reinsurers want the pool to carry larger working layers and that the board has at times chosen to self-insure layers when reinsurance quotes were unaffordable.

Commissioners asked about options the county has to reduce exposure. Boyd emphasized funding and leadership-driven risk culture: "All department heads, all elected officials, and everybody puts on their Cowlitz County hat for whatever the issue that you're dealing with," he said, adding that top-down buy-in reduces claims by improving everyday risk management. He also said the pool has pursued legislative changes, including forming a legislative steering committee and soliciting lobbying services to pursue reforms such as tort-cap changes.

Boyd noted practical, on-the-ground programs the pool has funded: inmate-health monitoring devices and narcotics-detection sensors for jails, virtual-reality training systems for corrections and law enforcement, and targeted capital items (backup cameras, locks, non-skid stair strips) covered through the risk-reduction program to address high-frequency, low-severity claims.

Ending: Boyd urged the county to use pooled resources (contract review, predefense review, training and the Lexipol reimbursement) and said the coming months will require rate-setting and board decisions to shore up funding. "We've just gotta get through the storm and get the claims that we have on the books off and not replace them with more claims," he said.