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County Sees Large Increases Projected in Insurance Assessments; Risk and Workers’ Comp Costs Rise in Draft Budget
Summary
Risk management staff told commissioners they built next‑year projections on an assumed 25% rise in general liability assessments and smaller increases in property and cyber premiums; workers’ compensation administration and claims are also projected to rise, and staff flagged uncertainty about deductibles and open claims.
County risk management staff and finance presented draft cost allocations at a budget workshop that assume substantially higher insurance assessments and rising workers’ compensation costs over the next biennium.
Risk assessments and insurance premiums
Staff said the county’s risk pool indicated premium pressure and staff built the draft budget assuming a 25% increase in general liability assessments for 2026 and a 20% increase for 2027. Staff said property and cyber insurance increases were modeled at 10% though final numbers are expected with the risk‑pool quote cycle in October.
Staff told commissioners that liability assessments are changing materially: a historical figure for the county’s MLC/general‑liability assessments rose from about $1.3 million in prior years to a projected $3.1 million for 2027 in the draft. The county also budgets a deductible reserve: staff proposed setting aside about $300,000 to cover the county’s share of deductibles and legal defense costs tied to tort claims; staff cautioned that if the risk pool increases deductibles, that reserve amount would need to grow.
Workers’ compensation (industrial accident)
For workers’ compensation, staff said the allocation is calculated using labor hours by person and risk class, aligning with state Labor and Industries (L&I) classifications. The draft budget includes third‑party administration fees and an excess policy that covers catastrophic payouts once the county’s self‑insured retention is exceeded. Staff cited a supplemental excess layer tied to a $750,000 per‑occurrence threshold (the annual premium for that layer was cited at about $141,000) and said the county has not historically paid to that layer but has active claims that could move toward that level in the future.
Staff also showed workers’ compensation administration and claims trending upward; they said higher medical costs and a few large open claims are driving per‑claim increases.
Next steps and commissioner questions
Commissioners asked for more details from the risk pool and for a workshop with the risk‑pool broker to examine the drivers. Staff said final premium quotes are expected in October and that, once received, the county will have limited options because the current contract cycle requires advance notice to change coverage.
Ending
Risk management staff advised commissioners to expect significant insurance and workers’ compensation budget pressure in the coming biennium and requested further policy discussion when risk pool quotes are received.
