HomeMy WebLinkAboutMINUTES - 12011987 - 1.113 To BOARD OF SUPERVISORS
FROM: Phil Batchelor, County Administrator Contra
@ Costa
DATE: December 1, 1987 County
SUBJECT: Actuarial Study of County' s Self-Insurance Trust Funds
SPECIFIC REQUEST(S) OR RECOMMENDATION(S) & BACKGROUND AND JUSTIFICATION
RECOMMENDATION•
Receive this report on the actuarial analyses of the County' s
self-funded workers ' compensation, general liability and medical liability
programs and readopt a funding strategy plan with a goal of funding the
County' s self-insurance programs at the 80 to 90 percent confidence level
by the end of the 1990-1991 fiscal year.
BACKGROUND:
Last year, the first comprehensive actuarial study of the County' s
self-insurance trust funds was completed. The study was submitted to the
Board of Supervisors on September 9, 1986, and referred to the Finance
Committee for review. On December 2, 1986, the Board approved the Finance
Committee' s recommendation to adopt a funding strategy plan with the goal
of funding the County' s self-insurance programs at the 80 to 90 percent
confidence levels by the end of 1989-1990 fiscal year.
An updated study of the County' s self-insured liabilities incurred
through June 30, 1987 found these liabilities are funded at approximately
the expected value level. Expected value refers to the overall average
level of losses estimated for a coverage year and approximates a 55 percent
confidence level. Confidence level refers to the estimated probability
that losses will not exceed the indicated reserve funding amount. The
actuary recommends funding at the 80 to 90 percent confidence level.
Since the previous actuarial study, the County has not increased its
self-insurance funding level above the expected value level. To ensure the
self-insurance program .is sound and able to meet its financial obligations,
the program should be funded at an 80 to 90 percent confidence level. To
accomplish this, upcoming fiscal years should be funded at the 90 percent
confidence level. This would result in raising the overall confidence
level for all liabilities. It is anticipated that three years of funding
at the 90 percent confidence level will bring the overall confidence level
of the program to 80 percent. It is, therefore, recommended that the
self-insurance program be funded at the 90 percent confidence level for the
next three fiscal years if sufficient funding can be identified to meet
this objective.
CONTINUED ON ATTACHMENT: _ YES SIGNATURE:
RECOMMENDATION OF COUNTY ADMINISTRATOR RECOMMENDAT ON O BOARE40MMITTEE
APPROVEA�-_ OTHER
/�y/���
SIGNATURE(S): ft
ACTION OF BOARD ON W-I�r APPROVED AS RECOMMENDED OTHER
VOTE OF SUPERVISORS
�-� 1 HEREBY CERTIFY THAT THIS IS A TRUE
UNANIMOUS (ABSENT ) AND CORRECT COPY OF AN ACTION TAKEN
AYES: NOES: AND ENTERED ON THE MINUTES OF THE BOARD
ABSENT: ABSTAIN: OF SUPERVISORS ON THE DATE n SH/'OWN.
cc: CAO - Risk Management ATTESTED DEC 1 1-_'A} 1
PHIL BATCHELOR, CLERK OF THE BOARD OF
�iSUPERVISORS
ANDCOUNTYADMINISTRATOR
BY �/ A (�i(� .DEPUTY
M382/7-83