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Delaware County weighs higher insurance retention to cut premiums but face bigger claim risk
Summary
County insurance broker USI presented two options: retain current low deductibles with higher premiums or raise liability retention to $250,000 to lower premiums by roughly $500K–$550K a year while increasing county out‑of‑pocket exposure; commissioners discussed managing pro se claims in‑house and deferred a final decision until before the March 1 renewal.
County commissioners heard a detailed presentation from insurance broker USI on January 20 outlining the financial trade-offs of raising the county’s self‑insured retentions.
Brent Webster and a colleague from USI reviewed five years of Delaware County claims and recommended two paths: keep the current low retentions, which produce more predictable out‑of‑pocket exposure but could yield a projected premium near the renewal estimate, or move toward a peer‑group average $250,000 retention for liability lines. USI estimated that a higher retention would reduce the premium by about $500,000–$550,000 annually but increase the county’s estimated out‑of‑pocket claims to roughly $627,000 in a sample scenario. The firm also noted a roughly $20,000 annual budget item for a third‑party administrator and additional legal costs when high‑severity claims require outside counsel.
Commissioners asked how the county would handle ‘‘pro se’’ claims and discussed whether existing county counsel or the prosecutor’s office could assume greater claims‑management responsibilities. A county official said a portion of pro se claims are often dismissed, but some still generate substantial carrier reserves and costs. USI emphasized that long‑term savings depend on claims management, not only on premium reduction.
Commissioners did not take a vote. Several said they preferred to gather more information about legal capacity to handle high‑retention claims and to finalize budget projections. The board set a decision window before the March 1 policy renewal, noting that canceling earlier could affect pro rata returns from the incumbent carrier.
