Approve the Establishment of a District Worker’s Compensation Excess Fund in Lieu of Purchasing an Excess Worker’s Compensation Insurance Policy, and Cancel the Current Excess Worker’s Compensation Insurance Policy, Effective July 18, 2007. (Exhibit A)

The School District is self-insured for worker’s compensation and liability claims. Each year, Excess Worker’s Compensation Insurance has been purchased to protect the district’s self-insured fund from individual catastrophic claims. A thorough analysis of excess claims has been performed and concludes that the cost for excess coverage has greatly exceeded any dollars returned for claims that have pierced the excess coverage amount. Further, the deductible the district must pay is $500,000 per occurrence with a proposed premium of $718,000 for the 2007/2008 school year for this excess coverage. Exhibit B outlines the Excess Worker’s Compensation insurance premium and deductible history, including the proposed costs for the 2007/2008 policy. Exhibit C provides a cost comparison of all insurance quotes received for the 2007/2008 Excess Worker’s Compensation insurance policy.

All District Goals and Critical Success Factors.

The Excess Worker’s Compensation fund is paid from the Self-Insured Worker’s Compensation fund. Estimated savings for the first year is $108,000 and $218,000 for each year there after. However, this includes placing $500,000 in a trust account each year for ten years creating a $5,000,000 excess loss fund.

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