County insurers warn rising property-reinsurance costs are driving contribution increases

Mike Sieminski, a representative of Minnesota County Intergovernmental Trust, briefed the Crow Wing County Board of Commissioners on June 24 about MCIT’s finances, coverages and services.

Sieminski said MCIT — which he described as a joint powers trust that provides claims handling and risk management for counties and associated local entities — is seeing “skyrocketing” reinsurance costs, especially on property coverage. “Property in particular has gone up 10% in a year’s time,” he said, and the trust has adjusted retentions to blunt some increases.

The trust raised its casualty per-claim retention from $850,000 to $1 million and raised a workers’ compensation retention from $500,000 to $1 million, changes Sieminski said saved money on reinsurance premiums. He said the trust also performs appraisals on member property every five years (the most recent for members was February 2023), and those valuations feed into members’ contribution calculations.

Sieminski detailed other factors behind higher contributions: increasing property values, rising labor and materials costs for repairs, and broader market pressure on reinsurance. He said MCIT returns dividends to members when actuarially appropriate and that dividends have been paid for roughly 30 years.

On cybersecurity, Sieminski said the trust has seen a drop in ransomware claim payments for the membership and credited counties’ training and email-security work: “Somewhere in the area of 90% of your claims start with email in one way, shape or form,” he said, and most recent declines are tied to fewer ransomware payouts.

Commissioners asked several operational questions. Commissioner Coring asked whether MCIT’s membership is limited to Minnesota; Sieminski confirmed it is (the trust is formed by a majority of Minnesota’s counties and other local entities). Commissioners asked about reserves and how MCIT invests member contributions; Sieminski said reserves are set internally, reviewed by claims staff, senior management and outside auditors, and that investable dollars are managed conservatively so the trust can meet claims.

Questions about the county’s premium cost elicited a specific figure from county staff: Deb Lopke reported that Crow Wing County’s 2025 property and casualty premium to MCIT is $818,000.

Sieminski outlined member services included with membership: loss control consultations, a resource-rich website with training and guidance, the Minnesota Safety Council membership, and inspection services for pressure vessels through HSB (Hartford Steam Boiler). He encouraged commissioners to engage MCIT early on coverage questions and to continue supporting local safety committees.

The presentation closed with commissioners asking for follow-up information on several items Sieminski said MCIT could provide: a further breakdown of administrative/management costs and more detailed premium/reserve figures on request.

The briefing was informational; no county action was taken on MCIT matters at the meeting.