Heart and hypertension drive Jax self-insurance liability costs

An interim AMI Risk Consultants actuarial review of the city of Jacksonville’s self-insurance program shows a seven-figure increase in the city’s outstanding claim liability (or loss reserve estimate) compared to six months prior.

This indicates yet another pressure on Jacksonville’s budget process this year and in years to come.

The report, submitted at the end of June for a period ending March 31, revealed a jump of $3.4 million (or 3.5 percent) compared to the estimate from Sept. 30, 2015.

The old estimate: $98.95 million.

The new number: $102.37 million.

The escalators in the actuarial review are largely driven by costs associated with first responders, with heart and hypertension leading the way.

Heart and hypertension cost estimates increased by 10 percent over six months for the sheriff’s office, from $20.84 million to $22.92 million, with a total jump of $2.085 million.

Fire saw an increase of $808,000, with the revised estimate now at $27.52 million.

The sheriff’s office also saw a $360,000 uptick in general outstanding claim liability, and a $746,000 uptick in automobile liability costs.

“The reserve decreased for Fire non-H&H, but increased for all other components. For Sheriff H&H there was adverse development in prior accident years, particularly accident year 2015. We have noted some claims for which the case incurred losses increased: Claim numbers 1510 01283 ($319,000), 1510 01258 (by $66,000), and 1510 01008 (by $50,000). Moreover, reserves for 2016 claims exceeded the payout of reserves from prior accident years,” the review asserted.

“For Other City non-H&H,” the report continued, “case incurred losses in accident years 1994 and prior exceeded our prior estimate of ultimate. Incurred losses of the claims 80W00829 and 81W00379 went up by $275,000 and $107,000 respectively. In addition, accident year 2015 developed by more than expected.”

As well, the auditors “compared our estimates for the ultimate losses for fiscal year 2016/2017 from the September 2015 valuation to March 2016 … our estimates have increased by $621,000 (or 2.3 percent) from previous valuation. For the City’s Workers’ Compensation estimates, H&H projections increased, while non-H&H overall decreased. An increase in Liability projections for the City is driven by Auto Liability for the Sheriff.”