Floyd County approves insurance renewals as premiums rise; workers' comp and law-enforcement deductibles increase

Glenn Smith, the county's insurance representative, told the Floyd County Commissioners on July 1 that the county's property and liability renewal package with Travelers and a workers' compensation plan proposal required approval to move to the county council.

Smith said the overall Travelers renewal produced a roughly 12% premium increase over the prior year and that the rise reflected three factors: additional insured values (about $13,000,000 because of new buildings), inflationary valuation increases and marketwide rate pressure in a small pool of insurers willing to cover public entities with law enforcement exposure.

Smith said the county's insured property and contents now total “right at a $100,000,000 worth of values” and that, at that scale, Travelers imposed a wind/hail deductible structure of “1% of the value of the building for the wind just for wind and hail with a minimum of 25,000.” He said a buyback to return to the county's prior $5,000 deductible would cost about $17,090 and was not good value; a $10,000 deductible option was quoted at about $8,500.

Smith identified additional drivers: scheduled equipment values rose about $560,000 (a roughly 13% increase) and the employment-practices deductible rose from $15,000 to $25,000. On law-enforcement coverage, he said carriers generally would not offer less than a $50,000 deductible (the county's prior level was $25,000).

He reported one area of stability: cyber liability “is exactly the same as last year to the penny,” and credited the county's multi-factor authentication adoption for improved cyber results. Smith also reviewed the county's recent claims activity and said some mid-six-figure reserves exist on individual matters but did not provide specifics.

On workers' compensation, Smith said the county's experience modification factor rose from 1.15 to 1.27 after a period with higher-than-expected losses; that change increased the workers' compensation premium, which Smith said is up roughly 13% and is driven primarily by the mod change rather than a rate increase. He presented an alternative large-deductible workers' compensation plan and compared two quotes: Eastern Alliance at about $139,000 (with a $150,000 deductible) and another vendor, IPEV, at about $253,000. He said Eastern Alliance had asked for a letter-of-credit to cover deductibles but the carrier's finance chief agreed to reduce the request to a lower amount (reported in the meeting as $250,000).

After discussion and a brief amendment to expand the motion to “accept all proposals presented this evening from [the agency],” commissioners voted unanimously to accept the insurance proposals and forward them to the county council for funding consideration. Smith noted final contract documents, including an uninsured-motorist selection form and signatures for the high-deductible workers' compensation option, would follow.

Why this matters: The renewed policies set the county's financial exposure for property, liability, law-enforcement claims and employee injuries. Changes to deductibles and experience modifiers will affect the county's near-term budget and the council's appropriation decisions.

Ending: Commissioners directed staff to provide the full renewal documents to the council and to make the uninsured-motorist and deductible election paperwork available for signature so the county can complete its renewals on schedule.