Alliant Insurance Services proposes independent insurance program for Cowlitz County; projects short-term savings and warns of "claims-made" risks

Representatives from Alliant Insurance Services presented a feasibility analysis at Monday’s workshop proposing an independent insurance program for Cowlitz County as an alternative to its existing pool membership. Brian White, Anne Shackleford and other Alliant staff said an independently placed insurance tower could offer dedicated limits, a two-year premium guarantee on the primary casualty layer and potential premium savings in the first three years when compared with projected pool increases.

Alliant proposed two self-insured-retention (SIR) options—$250,000 and $500,000—and included third-party claims-administrator (TPA) estimates in the cost model. White said the firm had secured a two-year premium guarantee on the county’s primary $5 million layer and that the program would add a public entity purchasing group for excess layers. He described the proposed program as a move from being a “passenger” in a pooled arrangement to taking more control over underwriting and claims decisions for risks that are specific to Cowlitz County.

A primary technical focus of the discussion was the difference between occurrence-based coverage and claims-made coverage. Alliant said occurrence-based coverage for historical losses is preferable because it isolates liability to the policy in effect when a loss occurred; claims-made policies require additional “tail” coverage when coverage forms change and can make a later exit from a pool more expensive or difficult. "Occurrence based coverage is ... the gold standard," an Alliant representative said, and the group warned that if the pool moves coverage to claims-made forms, members could face expensive or hard-to-find tail policies.

Alliant presented a line-by-line projection that included a TPA cost (estimated at about $40,000 annually), and trended the county’s historical incurred losses to estimate an annual funding requirement for a given SIR. For the $250,000 retention scenario Alliant estimated an annual funding need (to cover indemnity and defense costs) of roughly $340,000 based on trended loss history. The team said the projection used county loss history provided by the pool and trended claims to present value with an 8% factor.

County commissioners and staff asked about service parity with the pool, board makeup and the durability of contractual relationships. Alliant said many of the services the pool provides can be replicated or improved—loss-control training subsidies, access to online training (Vector Solutions) and claims advocacy—and that the broker would support transition, the county’s TPA selection and recruiting insurers with experience in the public sector.

Alliant stressed the market nuance: Washington has become a harder market for some lines and the company’s role would be to cultivate insurer relationships, underwrite the county on its own merits and help the county tell its risk story to markets. The firm noted it already works with several large Washington public entities and operates a public-entity purchasing vehicle that could provide excess capacity.

Ending: Commissioners asked for time to review the analysis. Several commissioners expressed interest in continued exploration but raised a central caveat: if the current pool changes to claims-made coverage without a market tail, counties could face significantly higher long-term costs. Alliant was asked to provide refreshed quotes and to continue discussions with county staff about next steps and timing.