Archive for Wednesday, May 15, 2002

District hits insurance complications

May 15, 2002

An effort to make the school's insurance selection process run smoother has met a barrier.

But Superintendent Richard Erickson said the situation will be better by next month, just in time for the new policy to take effect.

Last fall, the Tonganoxie school district contracted with Kansas Association of School Boards for insurance specifications to be drawn up.

But when the district's two insurance bids, one for the entire package from Evans Insurance Agency, and one for worker's compensation only from Kansas Association of School Boards, were opened on May 7, it was learned that the bidders had used different experience modification rates, called "mods" to calculate their workers' compensation bids.

Bill Curtis, KASB associate executive director and fund administrator, said KASB had used a mod rating of 1.19, and Evans Insurance had used a mod rating of 1.29.

In order to compare like figures, KASB then resubmitted a bid based on the 1.29 figure. When the numbers were compared, Evans' quote on the workers' compensation part of the plan was $54,578, compared to KASB's quote of $56,383.

"The new mod effective July 1, 2002, is 1.19 on our original bid," Curtis told school board members Monday night. "That's a difference of about $10,000. I would suggest you give the Evans agency the opportunity to give another bid using the 1.19 or you accept our bid."

Board member Ron Moore said mods are set 60 days prior to a policy's renewal date and become effective at that date. The school district's renewal date is July 1 and the insurance bids were due May 7.

"You should have had a copy of that mod by May 1," Moore said.

Addressing Curtis, Moore asked who had prepared the bid specifications.

Curtis said they were written by KASB's loss specialist, Liz Maisberger-Clark.

"That is exactly correct," Moore said. "And we had you do the bid specs so we wouldn't have this kind of problem."

Moore advised Curtis to make sure next year that the school district's insurance specifications include the mod rating.

The board voted to approve Evans' bid for the property and casualty coverage only. The board will renew the bid for the workers' compensation insurance and will vote on a carrier at the June meeting.

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