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SCORE
Liability Rating Liability Rating PlanPlan
Liability Rating Liability Rating PlanPlan
What is it? How does it work?
Presented ByJackie Parker
Today’s OutlineToday’s Outline Members in Liability What is the Rating Plan? SCORE’s Liability Program CJPRMA Layer Shared Risk Layer Banking Layer SCORE Administrative Costs Breakdown of SCORE Liability
Layers
Who’s in the Liability Program?
What is the Rating What is the Rating Plan?Plan?The Rating Plan is a method for
equitably allocating premium amongst SCORE member cities for:
Bodily InjuryProperty DamagePublic Officials Errors & Omissions
The Rating Plan uses risk sharing concepts and techniques.
The Rating Plan allocates all program costs to members.
A Look at the SCORE A Look at the SCORE Liability ProgramLiability Program
California Joint Powers Risk California Joint Powers Risk Management Authority (CJPRMA)Management Authority (CJPRMA)
$500,000 to $40,000,000 per $500,000 to $40,000,000 per occurrenceoccurrence
SCORE Shared Risk LayerSCORE Shared Risk Layer$25,000 to $500,000 per occurrence$25,000 to $500,000 per occurrence
SCORE Banking LayerSCORE Banking Layer$25,000 per occurrence$25,000 per occurrence
Total “Voting” Members = 22
Total City Members = 9305/06 Member Contrib. =
$16,397,844
CJPRMA member since 198722% of Total City Members05/06 SCORE Contrib. =
$211,712 (1.3% of CJPRMA Total Contributions)
CJPRMACJPRMA$500,000 to $40,000,000 per occurrence$500,000 to $40,000,000 per occurrence
SCORE
Fort Jones $3,511 Loomis $18,208
Dorris $3,950 Ione $20,616
Loyalton $4,672 Live Oak $22,833
Montague $6,864 Williams $26,863
Isleton $9,643 Weed $41,089
Biggs $9,814 Mt. Shasta $45,055
Etna $10,252 Crescent City
$66,717
Colfax $12,785 Yreka $82,064
Portola $13,908 Susanville $90,472
Rio Dell $14,202 Shasta Lake $99,814
Dunsmuir $14,939 TOTAL: $618,271
SCORE Shared Risk LayerSCORE Shared Risk Layer$25,000 to $500,000 per occurrence$25,000 to $500,000 per occurrenceMember Contributions (FY 05/06)Member Contributions (FY 05/06)
SCORE Shared Risk LayerSCORE Shared Risk Layer$25,000 to $500,000 per occurrence$25,000 to $500,000 per occurrence
Actuarial Funding RatesFY 2005-2006
Recommended Range
Expected
70% CL
75% CL
80% CL
85% CL
90% CL
$1.99 $2.42 $2.65 $2.95 $3.31 $3.80
SCORE Shared Risk LayerSCORE Shared Risk Layer$25,000 to $500,000 per occurrence$25,000 to $500,000 per occurrence
Deposit Premium = Actuarial Rate @ 80%* Confidence Level x Member Estimated Payroll Adjusted by their Experience Modification FactorExperience Modification Factor = Relative Loss Rate x Credibility Factor
Relative Loss Rate = Individual Member Loss Rate ÷ by Total Loss Rate for all members* Minimum Governing Documents Require. Recommendation of 85% Confidence Level for 2007/2008 Budget.
SCORE Shared Risk LayerSCORE Shared Risk Layer$25,000 to $500,000 per occurrence$25,000 to $500,000 per occurrence
Credibility Factor =Individual Members Payroll divided by (Total Members Payroll + Constant)
The Credibility Factor is applied to members payroll to create a more equitable distribution of payrolls.
Loss Rate = Individual Member Losses Past Five Years (2001-2006) ÷ Individual Member Payroll Past Five Years (2001-2006)
Isleton $6,736 Fort Jones $14,828
Biggs $7,422 Ione $15,062
Etna $8,003 Live Oak $16,193
Colfax $8,788 Williams $17,569
Montague $9,590 Mt. Shasta $33,613
Rio Dell $9,606 Weed $33,947
Portola $10,155 Crescent City $42,431
Dunsmuir $12,032 Susanville $58,553
Loyalton $12,995 Yreka $61,131
Loomis $13,320 Shasta Lake $84,671
Dorris $14,245 TOTAL: $490,889
SCORE Banking LayerSCORE Banking Layer$0 to $25,000 per occurrence$0 to $25,000 per occurrence
Member Contributions (FY 05/06)Member Contributions (FY 05/06)
SCORE Banking LayerSCORE Banking Layer$0 to $25,000 per occurrence$0 to $25,000 per occurrence
Member Contributions (FY 05/06)Member Contributions (FY 05/06)
Actuarial Funding RatesFY 2005-2006
Recommended Range
Expected
70% CL
75% CL
80% CL
85% CL
90% CL
$1.65 $1.98 $2.14 $2.32 $2.56 $2.88
Deposit Premium = Actuarial Rate @ 80%* Confidence Level x Member Estimated Payroll Adjusted by their Experience Modification
Minimum deposit premium of $20,0003 member cities currently pay the minimum
Maximum deposit premium of $250,000.2 member cities are close to paying the maximumExperience Modification = Relative
Loss Rate x Credibility Factor
SCORE Banking Layer SCORE Banking Layer (Same as (Same as Shared Layer)Shared Layer)
$0 to $25,000 per occurrence$0 to $25,000 per occurrence
* Minimum Governing Documents Require. Recommendation of 85% Confidence Level for 2007/2008 Budget.
Credibility Factor =Individual Members Payroll divided by (Total Members Payroll + Constant)
The Credibility Factor is applied to members payroll to create a more equitable distribution of payrolls.
Loss Rate = Individual Member Losses Past Five Years (2001-2006) ÷ Individual Member Payroll Past Five Years (2001-2006)
Relative Loss Rate = Individual Member Loss Rate ÷ by Total Loss Rate for all members
SCORE Banking Layer SCORE Banking Layer (Same as (Same as Shared Layer)Shared Layer)
$0 to $25,000 per occurrence$0 to $25,000 per occurrence
Member Entity
DE6 Payroll Inflated
Percentage of Total
Expense Allocated
By Payroll
Cost Allocat
edEqually
Liability Admin
Costs
Biggs $284,120 1.35% $1,619 $5,691 $7,310
Colfax $460,964 2.20% $2,627 $5,691 $8,318
Crescent City $2,708,364 12.91% $15,433 $5,691 $21,124
Dorris $127,551 0.61% $727 $5,691 $6,418
Dunsmuir $390,996 1.86% $2,228 $5,691 $7,919
Etna $276,802 1.32% $1,577 $5,691 $7,268
Fort Jones $118,832 0.57% $677 $5,691 $6,368
Ione $691,831 3.30% $3,942 $5,691 $9,633
Isleton $327,438 1.56% $1,866 $5,691 $7,557
Live Oak $813,938 3.88% $4,638 $5,691 $10,329
Loomis $604,396 2.88% $3,444 $5,691 $9,135
Loyalton $159,377 0.76% $908 $5,691 $6,599
Montague $232,589 1.11% $1,325 $5,691 $7,016
Mt. Shasta $1,502,827 7.17% $8,564 $5,691 $14,255
Portola $452,951 2.16% $2,581 $5,691 $8,272
Rio Dell $530,598 2.53% $3,024 $5,691 $8,715
Shasta Lake $2,486,180 11.85% $14,167 $5,691 $19,858
Susanville $3,848,292 18.35% $21,929 $5,691 $27,620
Weed $1,077,260 5.14% $6,139 $5,691 $11,830
Williams $1,095,599 5.22% $6,243 $5,691 $11,934
Yreka $2,781,609 13.26% $15,851 $5,691 $21,542
Total: $20,972,515 100.00% $119,509 $119,511 $239,020
Breakdown of SCORE Breakdown of SCORE Liability LayersLiability Layers
CJPRMA$40 Million Limit21 Participating Cities$211,712 Premium (05/06 FY)>2% of Program Costs
SCORE Shared Layer$150,000 Limit$913, 328 Premium (05/06 FY)>3% of Program Costs
SCORE Banking Layer$25,000 Limit$649, 401 Premium (05/06 FY)>17% of Program Costs