Todd County hears MCIT annual report as reinsurance, property values push insurance costs higher

Todd County commissioners on an August meeting heard an annual report from MCIT (Minnesota Counties Intergovernmental Trust) that outlined how rising property values and higher reinsurance costs are pushing up the trust’s overall cost of coverage, while the county’s workers’ compensation performance produced a dividend return of $31,831.

MCIT risk management consultant Joe Siminski presented the report and described MCIT as a joint powers entity that provides risk management and claims coverage to 81 of Minnesota’s 87 counties and about 400 associated members such as agricultural societies, historical societies and soil and water conservation districts. “We’re not from the private insurance industry. We don’t have a profit motive,” Siminski said.

He told the commissioners the twin pressures of rising property values and higher reinsurance pricing are the largest factors increasing contributions members pay to MCIT. “Reinsurance costs are going up,” Siminski said. He said MCIT has adjusted reinsurance retentions — raising liability retention from approximately $850,000 to $1,000,000 and increasing the workers’ compensation retention from $500,000 to $1,000,000 — to blunt premium increases. MCIT’s analysis showed the liability retention change avoided an almost 20% premium increase, and the work-comp retention adjustment saved about $470,000 in reinsurance premiums systemwide.

Siminski said total insured values continue to climb because construction costs, labor and materials have increased. That higher insured value increases the amount that must be covered in a large loss and therefore raises reinsurance costs. He described the combined effect as the dominant cost driver for the trust and for member contributions.

On cyber claims, Siminski said the number of incidents has trended upward but the total dollars paid have moved down from a 2023 spike largely because of fewer ransomware payouts. He credited member actions — improved email filtering and employee training — with reducing ransomware losses. “A lot of the claims… start from email of some sort,” Siminski said, adding that membership efforts on training and controls have helped reduce payments.

Siminski also reviewed workers’ compensation metrics and local results. Todd County’s workers’ compensation modification rate (mod) was reported at 0.853 — below the industry expectation of 1.0 — which the presenter described as “phenomenal” and a factor in the county’s work-comp dividend. The county received a $31,831 dividend based on its workers’ compensation performance in 2024, Siminski said. He cautioned that property-line cost pressures kept a broader dividend from being feasible across all lines.

The presentation listed several value-added services MCIT offers members: loss-control consulting and contract-review assistance, an employee assistance program, benchmark analytics and a workplace injury hotline. MCIT also provides membership in the Minnesota Safety Council and partners with Hartford Steam Boiler (HSB) for equipment-breakdown coverage and pressure-vessel inspections required by the state. Siminski noted 50 enrollments from the county sheriff’s office in MCIT’s online peace-officer accredited training program and mentioned defensive-driver training available through the Minnesota Safety Council.

When commissioners asked about reinsurers, Siminski said carriers change periodically but named Travelers for property coverage, CRL for cyber and liability lines in some placements, the state workers’ compensation fund for work comp, and Hartford Steam Boiler handling equipment breakdown claims and inspections. He said MCIT does not “experience-rate” members for large regional events the way private insurers sometimes do; instead, MCIT’s structure and reinsurance placements create a different exposure profile for members.

After the presentation and questions, the board recessed the meeting and set the next meeting for Aug. 19.