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Home My WebLink AboutInfo Item - Risk Management ReportCITY OF INFORMATIONAL ITEM RISK MANAGEMENT REQUEST: Informational Item -- Risk Management Report SUBMITTED BY: Gary Rosenblum, Risk Manager DATE: August 24, 2006 CONTENTS: JPIA Workers' Compensation Summary JPIA Retrospective Deposit Computation Executive Summary: On July 19, 2006, the City of Palm Desert received the 2006 Risk Management Award for the "Lowest Five -Year Average Cost of Workers' Compensation Claims" at the California Joint Powers Insurance Authority (JPIA) Annual Meeting. This award is based on a formula that includes claims frequency, severity, and payroll size. Palm Desert's workers' compensation costs were lower than 21 other city members of the JPIA in their "large city" category. On June 30, 2006, the City received a refund on our JPIA insurance deposit of $286,800. Of this amount, $125,290.00 was the result of our excellent workers' compensation claims record, and $161,510.00 was based on our better than expected liability claims costs. Discussion: On July 19, 2006, the City of Palm Desert received the 2006 Risk Management Award for the "Lowest Five -Year Average Cost of Workers' Compensation Claims" at the California Joint Powers Insurance Authority (JPIA) Annual Meeting. This award is based on a formula that includes claims frequency, severity, and payroll size. Palm Desert's workers' compensation costs were lower than 21 other city members of the JPIA in their "large city" category. The JPIA is the organization that provides insurance coverage and risk management administration support for the City and 114 other cities and government agencies throughout California. The insurance provided is a self-insurance pool funded by each city in proportion to their size in payroll and on their claims history. A detailed summary of the JPIA data is attached. Of particular note is our "Average Claim Count", which is 5.0. For all the cities in our "large" payroll size class, the next nearest Average Claim Count was 11.0, and the highest city claim count was 60.8. This level of performance reflects our excellent workplace safety record with only two minor injuries occurring over the past three years. Our safety record is a direct result of our Safety Committee's work, and our employees' strong commitment to workplace safety. It also Risk Management Report Page 2 of 2 August 24, 2006 reflects our investment in safety training, our employee's willingness to identify hazards and correct them before they can cause injuries, and management's commitment to safety. The financial benefits of our excellent safety performance have also been recognized by the California JPIA. Each year, the JPIA estimates the amount of our "deposit" to cover our losses, which resembles an insurance premium paid to JPIA. JPIA then calculates the actual cost of claims over a five-year period. If the cost of claims is higher than estimated, the City makes an additional deposit to cover the losses, but if the cost of claims is lower than expected, the City receives a refund on the deposit. On June 30, 2006, the City received a $286,800 refund from the JPIA. Of this amount, $125,290.00 was the result of our excellent workers' compensation claims record, and $161,510.00 was based on our better than expected liability claims costs. The refund for workers' compensation deposits is a direct return on our safety investments (training, equipment, supplies) over the past four years and shows that "safety pays." Our liability refund is due to a strong reduction in frequency and size of liability claims against the City over the past four years. This is due in part to implementation of improved claims management processes and investigation procedures, hazard identification and correction programs by the Risk Manager. It is also due to all the City employees' who expanded their improved safety consciousness from the workplace to the entire City and all of its residents. We cannot prevent all claims. However, when hazards in the streets and parks are found and corrected immediately, and complaints and reports from citizens are investigated and acted upon quickly when they are found to be risks, claims frequency and severity can be reduced. The attached JPIA data show that Palm Desert is 9th among cities in its class in liability costs. The Risk Management Department looks forward to continuing to reduce the losses caused by accidents and injuries, reducing the frequency and size of liability claims and reducing the City's overall cost of insurance. Submitted By: Gary Rosenblum V Risk Manager Approval: CarlosL. O a City Manager Departme Head: Homer Croy ACM for Dev I ment Services CITY COUNCIL ACTION: APPROVED DENIED RECEIVED_ OTHER MEETING DATE Ll U�o AYES: &�PAOEZ�y)!1-j ��.ic�if m zu�tU✓� NOES: _ ABSENT: -n(A Q, ABSTAIN: -p�t,(Z.;� VERIFIED BY: Original on File withJ City Clerk's Off4pe i FtV CALIFORNIA JPIA AGENDA REPORT. To: BOARD OF DIRECTORS From: Jonathan Shull, Executive Director Date: July 19, 2006 Subject: Presentation of Risk Management Awards Members will be recognized for demonstrating excellent risk management practices as shown by their cost of claims in both the General Liability and Workers' Compensation Programs. Those that have demonstrated the best overall performance for both the General Liability and Workers' Compensation Programs will also be recognized. Lowest Average Cost of Claims In order to determine the winners, members were placed in size categories based on a combination of population and payroll. Winners had the lowest average cost of claims for a five-year period based upon a uniformly applied formula. The focus was on claims costs per $100 of payroll, per year. Claims were limited to a maximum cost of $100,000; this limitation still includes 997o of the value of all of the claims, but eliminates the impact of large, fortuitous claims. The calculation spreadsheet has been attached to this item for informational purposes. Best Overall Performance This award recognizes members who have demonstrated the best overall performance in the general liability and workers' compensation programs. Staff first evaluated both quantitative and qualitative factors that are reflective of a member's risk management efforts. Factors included an agency's primary deposit refund per $10,000 of payroll, assistance and staff commitment to the Authority's Risk Management Evaluation process, utilization of the Authority's Risk Management Consultation services, and, finally, use of the Authority's video library and training opportunities. Members were again grouped into three tiers based upon payroll and population to determine awards for small, medium and large agencies. RISKMANAGEMENTAWARDS PROGRAM GENERAL LIABILITY Category: A Loy Member Avg PeyroII Avg Population Measure Avg Claim Count Avg I" Loss Arg Cost pet $100 Payroll 1 CV CVAG $1,035,410 0 0.0146145818 2 BB Bradbuty $305,600 875 0.0029182510 3 GW Gateway Cities COG $293,172 0 0.0018528925 4 HH Hidden Hills $185,405 1,999 0.0019450798 5 AC AHCCCA $444,456 0 0.0044540088 02 $129 $0.03 6 IW Indian Wells $2,350,938 4,354 0.0414703114 0.8 $1,129 S0.05 7 GT Grand Terrace $1,68S,032 12,094 0.0376042042 2.2 $2,113 S0.13 8 WV Westlake I riD., $713,984 8,722 0.0175753347 1.0 $1,169 S0.16 9 LH IA Habra Heights $1,071,073 5,S84 0.0209540090 0.4 $2,112 S0.20 10 SO Solvang $1,831,571 5,428 0.0335858987 12 $11,733 S0.64 11 FI Fillmore $2,540,410 14,708 0.0548035294 4.4 $18,114 $0.71 12 SA SEAACA $1,531,075 0 0.0231368054 3.0 $15,372 $1.00 13 BS Bishop $2,662,855 3,628 0.0461265893 2.0 $28,625 SL08 14 AG Agouta Hills $2,199,988 21,979 0.0560262422 2.6 $33,055 $1.50 15 NL Needles $2,299,162 5,253 0.0414547434 3.2 $34,579 S1.50 16 AT Artesia $1,553,596 17,036 0.0401025450 4.6 $24,846 $1.60 17 VT Ventura Port District $1,573,000 0 0.02 8576434 1.0 $25,225 $1.60 18 CU Cudahy $1,496,021 25,501 0.04'13501053 1.6 $32 042 S2.14 19 O) Ojai $2,371,530 7,920 0.0452945121 32 $53,342 $2.25 20 iM Imperial $1,895,442 8,751 0.0379177567 3.2 $42,974 $2.26 21 BU Buellton $882,950 4,2223 0.0161027505 1.0 $22,393 $2.54 2.7 CR Carpinteria $1,779,714 14,454 0.0414773082 2.8 $46,775 $2.63 23 RH Rolling Hills Estates $1,812,V9 8,025 0.035791706S 22 $53,684 32.97 24 VP Villa Park $746,038 6,348 0.0159166495 1.8 $26,129 $3.50 25 LW Laguns Woods $597,747 18,013 0.0246182802 1.0 $25,184 S4.21 26 LF LaCaaadaFlinttidge $1,717,531 21,257 0.0470283206 3.4 $77,019 S4.48 27 RL Rolling Hills $406= 1,914 0.0056593962 0.4 S35,000 $8.62 Category. B Code Membes Arg Payroll Avg Population Measure An Claim Count Avg Inc Loss An Cost per $100 Payroll 1 IA La Palma $4,597,096 15,694 0.0911247338 2.8 $6,907 S0.15 2 HG Hawaiian Gardens $3,309,862 15,558 0.0688604654 2.8 $10,139 SUI. 3 LL Loma Linda $4,429,325 20,346 Q0927671024 4.0 $20,586 $0.46 4 DU Duarte $3,908,B32 22,021 0.0854475801 3.0 $28,430 $0.73 5 BL Big Bear Lake $6,082,114 6,0% 0.1073171527 7.6 $68,954 SLL3 6 ID Lawndale $2,909,231 31,573 0.0775567742 5.6 $33,250 M14 7 MP Moorpark $3,719,358 34,IM 0.0939535488 22 $43,515 $1.17 8 ML Mammoth Lakes $5,926,420 7,390 0.1058994406 21.6 $79,585 $1.34 9 LQ La Quints $4,449,875 31,458 0.1039333811 8.0 $69,106 $1.55 10 RM Rosemead $2,890,854 55,921 0.1009340317 2-8 $46,062 $1.59 11 LT Lomita $2,693,245 20,276 0.0628498366 3.2 $55,%2 $2.08 12 SE South El Monte $2,607,971 22,200 0.0632533915 3.4 $55,726 $2.14 13 CB Calabasas $4,632,827 22,158 0.0980295080 5.2 $101,920 $2.20 14 IR Irwindale $5,674,113 1,469 0.09%W1311 5.4 $139,894 $2.47 15 MW Maywood $4,407,481 29 212 0.1010194186 5.6 $114,660 $2.60 16 WA Walnut $2,976,356 31,036 0.0781885115 6.6 $83,426 $2.80 17 TC Temple City $2,521,007 34,505 0.0737348434 3.8 $77,572 S3.08 18 LP La Puente $1,929,642 42,541 0.0713874159 3.8 $60,717 S3.15 19 DB Diamond Bar $3,047,856 58,120 0.1057733440 5A $99,129 $3.25 20 PV Palos Verdes Estates $3,548,414 13,910 0.0713583006 &0 $122,737 S3.46 21 MB Malibu $2,871,043 13,204 0.0590248903 7.0 $115,555 $4.02 22 SD San Dimas $4,059,073 36,511 0.1021316934 7.2 $169,174 $4.17 23 LS Lake Forest $2,983,360 76,785 0.1128279668 6.2 $129,731 $4.35 24 LE Lake Ehinote $3,596,164 34,030 0.0917585372 8.8 $187,099 $5.20 25 AV Apple Valley $3,810,022 59,317 0.1200424863 7.2 $224,990 $5.91 t f 2 J RISK.112A NAGEMENT A WARDS PROGRAM WORKERS' COMPENSATION Carcgor3r A Code Member Avg Payroll Avg Population Measure Avg Claim Count Avg Inc Loss Avg Cost per $100 payroll 1 LW Laguna Woods $546,247 18,013 0.0193080356 2 AG Agoura Hills $2,245,788 21,979 0.0528332585 2.0 $2,930 $0.13 3 BU Buellton $882,950 4,223 0.0117660005 1.2 $5,240 $0.59 4 SO Solvang $1,831,571 5,428 0.0294971582 4.0 $15,604 S0.85 5 IW Indian Wells $2,350,938 4,354 0.0375173552 2.2 $21,882 ' $0.93 6 FI Fillmore $2,401,310 14,708 0.0494721204 3.6 S23,767 $0.99 7 RH Rolling Hills Estates $1,812,879 8,025 0.0316980793 3.4 S21,363 $1.18 8 MB Malibu $2,843,043 13,204 0.0547191725 1.8 $34,061 $1.20 9 AC AHCCCA $444,306 0 0.0000000000 1.0 S6,184 $1.39 10 HG Hawaiian Gardens $3,221,862 15,558 0.0636221755 8.2 $45,833 $1.42 11 CR Carpinteria $1,767,714 14,454 0.0371655505 4.0 $28,138 $1.59 12 OJ Ojai S2,015,651 7,920 0.0351350847 5.4 $36,601 $1.82 13 CU Cudahy $1,471,021 25,501 0.0427372637 4.4 $33,704 $2.29 14 SA SEAACA $1,530,675 0 0.0189625206 11.4 S35,717 $2.33 15 SE South El Monte $2,583,538 22,200 0.0589431575 7.0 S61,554 $2.38 16 LT Lomita $2,693,245 20,276 0.0589863737 6.6 $75,748 $2.81 17 AT Artesia $1,552,596 17,036 0.0359236752 4.6 $55,497 $3.57 18 VT Ventura Port District $1,573,000 0 0.0197013014 5.0 $64,447 $4.10 19 NL Needles $2,298,129 5,253 0.0374702286 10.0 $152,844 $6.65 Category: B Code Member Avg Payroll Avg Population Measure Avg Claim Count Avg Inc Loss Avg Cost per $100 payroll 1 LS Lake Forest $2,972,460 76,785 0.1188500932 22 $18,105 $0.61 2 DU Duarte $3,908,832 22,021 0.0819019228 5.6 S24,661 $0.63 3 SD San Dimas $4,058,073 36,511 0.0986078604 4.8 $29,025 $0.72 4 LP La Puente $1,928,842 42,541 0.0673103514 4.0 $14,157 $0.73 5 LN Laguna Niguel $3,757,271 64,908 0.1209911518 4.4 $33,220 $0.88 6 CB Calabasas $4,609,327 22,158 0.0942629419 4.6 $43,414 $0.94 7 WA Walnut $2,965,356 31,036 0.0742070611 7.2 $30,603 $1.03 8 RP Rancho Palos Verdes $2,822,913 42,434 0.0828118020 3.6 $30,875 $1.09 9 PV Palos Verdes Estates S3,523,454 13,910 0.0672827390 7.2 $39,205 $1.11 10 MP Moorpark S3,719,358 34,109 0.0903593550 5.0 $41,464 $1.11 11 LQ La Quinta $4,449,875 31,458 0.1005291753 7.0 $71,170 $1.60 12 TC Temple City $2,451,507 34,505 0.0686132305 4.6 $39,352 $1.61 13 MW Maywood $4,405,181 29,212 0.0975639827 16.0 $82,980 $1.88 14 IR Irwindale $5,674,113 1,469 0.0927159926 11.8 S124,992 $2.20 15 LD Lawndale $2,884,931 31,573 0.0733256236 5.8 $63,620 $2.21 16 I.L Loma Linda $4,423,825 20,346 0.0892615217 13.8 $100,283 $2.27 17 SH SignalI-Till $7,316,433 10,307 0.1299828947 17.8 $219,193 $3.00 18 LA La Palma $4,582,098 15,694 0.0874971938 10.2 $156,681 $3.42 Category. • C Code Member 1 PD Palm Desert 2 LR La Mirada 3 CA Camarillo 4 CH Chino Hills 5 MV 'Afission Viejo 6 CL Claremont 7 CE Cerritos 8 BF Bellflower 9 LK Lakewood 10 PW Poway 11 PM Paramount Avg Payroll Avg Population Measure Avg Claim Count Avg Inc Loss Avg Cost per $100 payroll $9,332,398 44,639 0.1985801684 5.0 $44,614 $0.48 $6,880,314 49,001 0.1600238925 15.4 $38,117 $0.55 S9,674,528 60,661 0.2201435991 16.4 $53,878 $0.56 $7,126,903 73,470 0.1881394524 11.0 $58,043 $0.81 S8,848,183 97,952 0.2420087276 15.2 S77,994 $0.88 $11,927,521 35,674 0.2351540827 24.6 $139,076 $1.17 $19,308,369 51,590 0.3794753160 28.6 $240,976 $1.25 $6,902,618 76,180 0.1868617336 13.4 $86,848 $1.26 $12,079,340 82,315 0.2831915260 21.2 $157,542 $1.30 $15,844,265 49,976 0,3174385007 36.8 $220,886 $1,39 $7,321,493 56,241 0.1747708530 12.6 $107,169 $1.46 1of2 CALIFORNIA P , I • A July 3, 2006 Mr. Paul Gibson City of Palm Desert 73-510 Fred Waring Drive Palm Desert, CA 92260 Dear Mr. It is a pleasure to send the enclosed check in the amount of $286,800 to the City of Palm Desert. This check represents the return deposit due you under the CALIFORNIA JOtNT POWERS INSURANCE AUTHORITY'S March 2006 Retrospective Deposit Computation. In an effort to reduce cash flow fluctuations, the Executive Committee has adopted a "rolling" retro payment and refund schedule for our members. One-fourth of the retro amount will be paid or refunded in each year for four years. The effect of this is that payments and refunds will partially net out, thus reducing cash flow fluctuations from year to year. This check is the net of one-fourth of your retro refund or payment in each of the years 2003, 2004, 2005 and 2006. A spreadsheet is attached which shows how the rolling retro is computed for each program in which you participate. The check stub indicates the portion attributable to your participation in the general liability program and the workers' compensation program, if applicable. We are returning a total of $5,801,364 to 72 of our members in the liability program, and $3,253,485 to 47 of our members in the workers' compensation program. LSincer y, an R. Shull Executive Director Enclosures CALIFORNIA JOINT POWERS INSURANCE AUTHORITY 8091 MOODY SFREE'l'. 1.A PALPOA. CA 90621 'II•IL (562) 167-8700 FAX (562) 860-49112 STATEMENT CALIFORNIA l P ' I A July 3, 2006 City of Palm Desert 73 -5 10 Fred Waring Drive Palm Desert, CA 92260 Attention: Mr. Paul Gibson Director of Finance/City Treasurer Description General Liability Retro (Deposit)/Refund: Amount Due Balance March 2003 Retro Computation (41h Inst.) $101,136 X 25% = $25,284 $0 March 2004 Retro Computation (3`d Inst.) ($59,228) X 25% = ($14,807) ($14,807) March 2005 Retro Computation (2"d Inst.) $272,435 X 25% = $68,109 $136,217 March 2006 Retro Computation (I" Inst.) $331,697 X 25% = $82,924 $248,773 GL Retro (Deposit)/Refund: Workers' Compensation Retro (Deposit)/Refund: $161,510 $370,183 March 2003 Retro Computation (41h Inst.) $137,667 X 25% = $34,416 $0 March 2004 Retro Computation (3`d Inst.) $127,132 X 25% = $31,783 $31,783 March 2005 Retro Computation (2"d Inst.) $195,538 X 25% = $48,885 $97,768 March 2006 Retro Computation (1" Inst.) $40,822 X 25% = $10,206 $30,616 WC Retro (Deposit)/Refund: $125,290 $160,167 Total/Net Retro Refund $286,800 CALI FORN I J<JI N I- POW E RS I NSU RANCC AUTI-IoRI TY 8081 MOODY STREET. LA rALMA. CA 90623 TEL (562) 467-8700 FAX (562) 860-4992 �..o�++a.an.�o71�1a111u•.+i trams.,rra.•tn�.t•.e.+�err+rc.r�..'. u.�m �zs.er-u. n>._err_u-t.t:,ct.t.v.tt.su:�►.��ict..�.a•n-cr�, CALIFORNIA JOINT POWERS Wells Fargo Bank, N.A. i210 INSURANCE AUTHORITY NO., O O 2 9 Government Agency CAWXN,A 8081 Moody Street La Palma, CA 90623 DATE CHECK NUMBER AMOt1NT ';`4'' 06/30/06 000000229T PAY THE SUM OF ****'$286,800* DOLLARSANDOO CENTS * $286,800.00 TO THE ORDER OF CAUFORNIA JOINT POWIE0$, INSURANCE AwHoR6m? -VOID AFTER SM-MONT14S CITY OF PALM DESERT 73-510 FRED WARING DR PALM DESERT, CA 92260 11800 2 29 Lila I: L 2 L000 248i: 4 L S 13ci 2786n, THE ATTACHED CHECK IS IN SETTLEMENT OF ITEMS LISTED. PLEASE DETACH AND RETAIN THIS STATEMENT FOR YOUR RECORDS. 002291 DATE DESCRIPTION INVOICE NUMBERS ACCOUNT NUMBER- 06/30/06 ; GL RETRO DEP. ORD INST) GL RET 3/04 1000-1215 ($ 14,807.00) GL RETRO REFND (4TH INST) GL RET 3/03 1000-2105 25,284.00 GL RETRO REFND (2ND INST) GL RET 3/05 1000-2105 68,109.00 GL RETRO REFND (1ST INST) GL RET 3/06 1000-2105 82,924.00 WC RETRO REFND (4TH INST) WC RET 3/03 1000-2106 34,416.00 WC RETRO REFND (3RD INST) WC RET 3/04 1000-2106 31,783.00 WC RETRO REFND (2ND INST) WC RET 3/05 1000-2106 48,885.00 WC RETRO REFND (1ST INST) iWC RET 3/06 1000-2106 10,206.00 RECEIVED 1 JUL 13 2006 Development Services City of Palm Desert CITY OF PALM DESERT CALIFORNIA JOINT POWERS INSURANCE AUTHORITY 8081 Moody Street. La Palma, CA 90623 $286,800.00