[tidy error]
The Kentucky Association of Counties All Lines Fund held a special Board of Directors' meeting, pursuant to proper notice given in accordance with KRS 61.823, at 12:30 p.m. on Wednesday, January 30, 2019 at 400 Englewood Drive in Frankfort, Kentucky.
The roll was called. The following Directors were present: Chairman Robert Carpenter, Greenup Co. Judge/Executive; John Wilson, Garrard Co. Judge/Executive (via phone); Orbrey Gritton, Anderson Co. Judge/Executive; Charles Kenner, Boone Co. Commissioner; and Adam O'Nan, Union Co. Judge/Executive (via phone).
Others present were: Temple Juett, Director of Insurance; Brian Roy, Executive Director/CEO; Jim Henderson, Deputy Director; Kris Dunn, Underwriting Manager; Michael Ray, Safety & Loss Control Manager; Jeremy Head, Claims Manager; Bruce Lawson, Senior Accountant; Tim Sturgill, General Counsel; Karen Basham, Chief Financial Officer; Crystal Hellard, Litigated Claims Specialist; Rich Ornstein, Staff Attorney; Macy Thompson, Customer Service Representative; Clint Combs and Jerry Pace, Peel & Holland/KACo Marketing Agents; Sue Porter, David Livingston and Kathy Marshall, Roeding Insurance/KACo Marketing Agents; Andrea Morse, Underwriter Associate; Steve Bolton, Board Counsel; Jeff McCaffrey, Deming, Malone, Livesay & Ostroff, PLLC; Grant Satterly, Director of Financial Services; Jesse Penn, Computer Support Specialist; and Sonya Chesser, Executive Secretary.
Chairman Carpenter called the meeting to order at 12:38 p.m.
Chairman Carpenter welcomed new board members: Judge O'Nan, Judge Gritton, and Commissioner Kenner.
Chairman Carpenter accepted nominations for a chairman, vice-chair and secretary.
Motion made by John Wilson, seconded by Orbrey Gritton, to elect Bobby Carpenter as chair. Motion carried.
Motion made by Chairman Carpenter, seconded by Orbrey Gritton, to elect John Wilson as vice-chair. Motion carried.
Motion made by John Wilson, seconded by Orbrey Gritton, to elect Sonya Chesser as secretary. Motion carried.
Motion made by John Wilson, seconded by Chairman Carpenter, to approve the minutes of the December 19, 2018 meeting. Motion carried.
Ms. Basham presented and discussed the following reports: FY 2018/19 budget detail for the six months ending December 31, 2018; balance sheet as of December 31, 2018; FY 2018/19 PAF budget for period July 1, 2018 - December 31, 2018; FY 2018/19 addition and deletions for December 1 - 31, 2018; FY 2018/19 premium receivables as of January 22, 2019; FY 2018/19 agent commissions as of December 31, 2018; and FY 2018/19 investment portfolio summary as of December 31, 2018. She said the Fund is in compliance with its investment ratios as statutorily required by the Kentucky Department of Insurance.
Mr. Juett said Knox County Help, Inc., which owes a premium of $5,685.45, dissolved prior to July 1, 2018 and recommended writing it off as bad debt because of the cost the Fund would incur trying to collect. Mr. Sturgill recommended sending a notice of cancellation. Since it is a special meeting, Mr. Juett said he will ask the board to take action in sending a notice of cancellation to Knox County Help, Inc. at the next meeting. Mr. Bolton asked if the Knox County Help, Inc. board dissolved their Corporation. Mr. Sturgill said they had not and that the organization actually filed an annual report on August 5th and felt that nonpayment is grounds for cancellation. Mr. Bolton's concern is the Fund being liable for any possible claims incurred between the date of renewal to the date of cancellation. Mr. Juett will find out if the cancellation is indeed retroactive to date of the policy and that there is no exposure.
Motion made by Orbrey Gritton, seconded by Charles Kenner, to accept the financial reports as presented. Motion carried.
Mr. Head presented and discussed the following claims activity reports: summary of losses valued as of December 31, 2018; graphs of opened and closed claims during FY 2018; total open claims for all years as of December 31, 2018; and a chart comparing the number of claims from the last three to five to ten years including the incurred monthly averages as of June 30, 2018. There were a total of 187 newly reported claims totaling an incurred value of $1,231,120.51 for the month of December 2018 as compared to 150 reported claims totaling an incurred value of $1,109,303.76 for the month of December 2017.
Mr. McCaffrey presented and discussed the unaudited quarterly statement as of December 31, 2018.
Motion made by Orbrey Gritton, seconded by Charles Kenner, to approve the unaudited quarterly statement as presented. Motion carried.
Board members, who were present, signed the Trustee Confirmation of Receipt of the quarterly financial statement dated December 31, 2018.
Mr. Satterly presented and discussed the investment report and the quarterly security position changes for period October 1, 2018 through December 31, 2018. He also presented his personal outlook for January 2019.
Motion made by Charles Kenner, seconded by Orbrey Gritton, to ratify the quarterly security position changes as presented. Motion carried.
Mr. Juett said the actuarial rate study will be presented to the board for consideration at the next meeting.
Mr. Juett said Think HR, a human resources tool that the Fund has been considering as another option in the loss control program, is offered through the Fund's claim administrator, Underwriters Safety & Claims. After review, it was determined that the Fund may already have access to a tool similar to this program, HR360, through KACo's health program. He said staff is evaluating this product to determine if it will meet the needs and be cost effective. He will provide an update at the next meeting.
Mr. Juett said HCA will be visiting the Fund's members to conduct property appraisals through the months of April through October. Also, he said after negotiations, HCA lowered their price by $48,000 as to what was previously bid.
With regards to the Fund becoming a member of AGRiP, Mr. Juett said KACo, as the sponsoring agency of the insurance pools will be the named member of AGRiP, but the KACo All Lines Fund and the KACo Workers Compensation Fund will reimburse KACo for the membership dues.
Due to the KACo insurance forum coinciding with the next regularly scheduled board meeting on Feb. 20th, the board agreed to hold a special meeting on February 27th at 1pm.
Introductions of board and staff were made.
Motion made by Orbrey Gritton, seconded by Charles Kenner, to go into closed session at 1:35 p.m. to discuss proposed or pending litigation involving the board as authorized by KRS 61.810 (1)(c). Motion carried.
Motion made by Orbrey Gritton, seconded by Charles Kenner to return to open session at 1:51 p.m. Motion carried. No action was taken in closed session.
Motion made by Adam O'Nan, seconded by Orbrey Gritton, to adjourn the meeting at 1:51 p.m. Motion carried.
