[tidy error]
The Kentucky Association of Counties Workers' Compensation Fund held a special Board of Trustees' meeting, pursuant to proper notice given in accordance with KRS 61.823, at 10:30 a.m. on Wednesday, November 20, 2019 at 400 Englewood Drive in Frankfort, Kentucky.
The roll was called. The following Trustees were present: Chairman Greg Terry, Carlisle Co. Judge/Executive; Michael Logsdon, Oldham Co. Magistrate; Casey Ellis, Owen Co. Judge/Executive (via phone); Dan Mosley, Harlan Co. Judge/Executive (via phone); and Elbert Bennett, Caldwell Co. Magistrate.
Others present were: Temple Juett, Director of Insurance; Jim Henderson, Executive Director/CEO; Tim Sturgill, General Counsel; Karen Basham, Chief Financial Officer; Jeremy Head, Claims Manager; Michael Ray, Safety & Loss Control Manager; Bruce Lawson, Senior Accountant; Crystal Hellard, Litigated Claims Specialist; Kris Dunn, Underwriting Manager; Andrea Morse, Associate Underwriter; Marie Skinner, Accountant; Rich Ornstein, Staff Attorney; Macy Thompson and Kathy Basham, Customer Service Representatives; Rob Brown and Joe Greathouse, LGIA/KACo Marketing Agents; Jerry Pace and Clint Combs, Peel & Holland/Marketing Agents; Paul Harnice, Board Counsel, Stoll, Keenon, Ogden, PLLC; Greg Sisson, Jeremy Russell, Ed Meredith, and Terry Banaszak, Underwriters Safety & Claims; Grant Satterly, Director of Financial Services; Ryan Siemens, Programmer/Developer; Jesse Penn, Computer Support Specialist; and Sonya Chesser, Executive Secretary.
Chairman Terry called the meeting to order at 10:33 a.m.
Motion made by Michael Logsdon, seconded by Elbert Bennett, to approve the minutes of the October 22, 2019 meeting as presented. Motion carried.
Ms. Basham presented and discussed the following reports: balance sheet as of October 31, 2019; FY 2019/20 budget detail for the four months ending October 31, 2019; check history report for October 1 - 31, 2019; FY 2019/20 PAF budget for period July 1, 2019 through October 31, 2019; FY 2019/20 agent commissions as of October 31, 2019; FY 2019/20 premium receivables as of November 14, 2019; and FY 2019/20 investment portfolio summary as of October 31, 2019.
Motion made by Elbert Bennett, seconded by Michael Logsdon, to acknowledge receipt of the financial reports as presented. Motion carried.
Mr. Head presented and discussed the claims report activity for period 2015 through 2019. He also presented the new reported claims for October 2019 and top ten claims for 2019.
Mr. Juett provided the board with a written report of activities for November, which included an update on the grant program, law enforcement specialist, loss control, underwriting and AGRiP.
Ms. Basham provided an annual review of the finances of the Fund to determine if contributions should be returned to the members in the form of a dividend. Pursuant to the board's dividend policy requiring a minimum of 10 years of claims development, Ms. Basham conducted an analysis of the 2007-2008 policy year. The analysis showed that the Fund has just over $3 million in surplus for that year. However, since the KALF program is looking at declaring a dividend this year, staff's recommendation is to not issue a dividend this year.
Motion made by Casey Ellis, seconded by Dan Mosley, to table the issue until the next meeting since they did not have information available to review. Motion carried.
Mr. Ray discussed the Fund offering loss control safety videos for consideration for its members. He said he reached out to several vendors and received quotes with the best option available through Underwriters, Safety & Claims (USC). Mr. Sisson said USC can grant access to Succeed Training Solution, a software service that would allow KACo loss control consultants to offer bi-lingual safety video training on a wide variety of topics to KACo members. The annual fee is $5,000 and includes 100 safety video training views and unlimited e-learning sessions. Additional blocks of 1,000 safety video views annually are available for an extra $2,500. He said the software management will allow all users in the system to train and track employee training and assign e-learning courses/videos. Mr. Harnice suggested having members to certify that they have watched the video. Mr. Sisson said the system will automatically populate a report allowing KACo the opportunity to offer certification. Mr. Juett proposed that the cost of the service be split between the Fund and KALF. He will provide a draft of the agreement for the board's consideration at the next meeting.
Mr. Satterly presented an annual review of the investment policy as adopted December 18, 2013.
Mr. Juett presented and discussed the engagement letter from Oliver Wyman to perform a rate analysis for period July 1, 2020 through June 30, 2021 at fee of $9,750 and $5,000 to analyze the Fund's loss data by NCCI class codes. Mr. Harnice brought to the board's attention to Appendix A concerning the Limit of Liability should the Fund pursue a claim against Oliver Wyman that limits damages to the fee paid.
Motion made by Michael Logsdon, seconded by Elbert Bennett, approve the engagement letter with Oliver Wyman and to direct staff to discuss the Limit of Liability issue with them. Motion carried.
The next regularly scheduled board meeting will be held December 18th at 11:00 a.m.
Motion made by Michael Logsdon, seconded by Elbert Bennett, to go into closed session at 11:32 a.m. to discuss proposed or pending litigation involving the board as authorized by KRS 61.810 (1)(c). Motion carried.
Motion made by Casey Ellis, seconded by Dan Mosley to return to open session at 11:35 a.m. Motion carried.
Motion made by Michael Logsdon, seconded by Elbert Bennett, to adjourn the meeting at 11:35 a.m. Motion carried.
