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Risk manager outlines reasons for insurance premium increases; deductibles and limits explained
Summary
Victoria De Vargas, the county risk manager, told council on April 23 that liability premium increases reflect payroll growth, increased claims experience, reduced pool discounts and higher reinsurance costs tied to national disasters.
Los Alamos County’s risk manager walked the County Council through a breakout of the risk management budget and explained why premiums rose for FY2026.
Victoria De Vargas, the county’s risk manager, told councilors the premium increases are driven by several factors, including payroll (which the county’s self‑insurer pool uses to allocate liability costs), increases in losses that raise a participant’s share of pooled costs, new or expanded coverage expectations for public officials and law enforcement, and higher reinsurance prices nationally following recent natural disasters. "Liability coverage is driven by payroll," De Vargas said, summarizing the pool’s allocation method.
De Vargas also described program limits and out‑of‑pocket exposures. She told the council the county’s deductible for public‑officials errors and omissions liability was $25,000 per claim, and that claims under that amount are paid from county funds. She said aggregate limits for certain lines are in the low millions and that any loss above the insurance aggregate would be an exposure to the county budget. Reinsurance costs have risen materially, she said, and that increase is passed through to participants. Council members congratulated De Vargas for reducing the county’s internal deductible costs in recent years; one councilor cited out‑of‑pocket (IDC) payments falling from about $200,000 to roughly $65,000 year‑over‑year as a sign of improved claims handling.
Councilors asked how the premiums break down between lines (workers’ compensation driven by payroll, property based on values, and liability influenced by claims). De Vargas said some components are bundled by the pool and supplied as a single premium, which limits line‑by‑line granularity, but she identified the main drivers for the increases: payroll growth, increased claims experience, changes in pool discounting (a reduction that produced a base increase), coverage expansions for public officials and law enforcement and higher reinsurance costs.
Councilors accepted the discussion as a clarification for the risk management line in the budget and the item was treated as a clarification rather than a separate adoption vote.
