Special Board of Aldermen 10-25-2021 Page 2
Chairman Dowd
We'll bring the presentation up. Alderman Lopez has joined us on Zoom.
Kim Kleiner, Administrative Services Director
So the first slide if you can see it. | realize it’s small. It has a lot of data. We do have copies of the presentation if
you'd like it. Ms. Deshaies has copies. This is to show you that relatively year to year our total revenue, total
expenses, and ending balance has stayed fairly steady from year to year. It’s quite consistent. What you'll see at the
top there is in 2021 with the booking of this $541,000 incurred but not received, for the first time brought the fund into
a deficit of about $211,000.
Moving into Fiscal 2022, our current year, what we realized we knew we were going to have some increase in our
property and liability policies. So this year instead of funding the fund $3.8 million, what you saw was a transfer at
budget time if you might remember of $4.2 million. So looking at the fund if we were to look at the fund today, that
$211,000 deficit has already decreased of a deficit to $49,000. What we do expect each year, we fund the account
twice. So half of the annual appropriation goes in July when the budget is passed and half of it goes in in January.
So we will have another $2.1 million that’s transferred as part of the budget process in January.
Looking at the expenses of Fiscal 2022 so far to date, we’re trending favorably. Most of the policies have been paid
and our claims are trending fine. So we’re not concerned with this but what we do need to do is bring the fund into a
health balance and that’s what the $250,000 will do. It will bring that $49,000 deficit that we see today to a roughly
$200,000.
So here we're just showing you from year to year, we have funded the account approximately the same amount. We
had a slight increase over in Fiscal 2020 but other than that, we’ve always averaged right around $3.8 million until this
year is when the Board of Aldermen approved the $4.2 million. To the right, you’re going to see the change in the
incurred but not received. That is a report that is prepared by our actuaries based on the trends and Ms. Deshaies is
going to tell you about everything that goes into that report. Her office works very hard to give the actuaries all the
data that they need to estimate that trend.
This last slide is just showing you these are our claims. So our automobile, our property, our general liability, and our
workman’s comp. As you can see, they have remained pretty consistent. We have our ups and downs, different
years but nothing out of the ordinary. Again this year we so far for Fiscal 2022, of course we’re not that far through it
so I'll do a little knock, but so far so good we are trending favorably. But what | will ask is Ms. Deshaies is going to
give you just a little bit about what goes into the incurred but not received report which is what we book for trending
claims. We just want to be careful to say that not necessarily will these claims hit but it is the actuaries doing their due
diligence so that we remain and keep our reserves in a health balance.
Jennifer Deshaies, Risk Manager
So as the Mayor said, the IBNR increase is basically being driven by three worker’s comp. claims. All of them back
injuries. All of them have had surgery these claimants and they've been out of work. Important to point out that the
increase that you’re seeing is for the life of the claim. That life of the claim changes. They’re living documents. So
cases are reserved at the worst case scenarios. They’re estimates. They change based on claim activity but that’s
not the only thing that goes into the IBNR. If you have changes in State and federal laws, costs of health care, claim
administration costs, if your number of claims fluctuates from one year to another, your State fees, collections,
subrogations, liens, insurance contribution versus self-insurance, the life span of a claim, your interest rate. So
there’s so much country-wide trending, inflation, all that goes into that number. It’s not just the claims and, again, that
number can change as the life of the claim. Claims are open for the life of a person. So it’s not budgetary year. That
increase is for the life of any claims that you see.
Chairman Dowd
Are you all set Ms. Deshaies?
Jennifer Deshaies, Risk Manager
Yes I’m all set. I’m sorry.
