PURMIT Board of Trustees Meeting
May 22, 2017
9:00 a.m. – 3:00 p.m.
Minutes
Trustees Present: Ryan Hagemann (WOU), Lara Moore (EOU), Brian Roy (PSU), Patrick Hughes (OSU)
Others Present: Sheryl Sattler, Kim Severson and Ryan Britz (Berkley); Ron Graybeal, Joel Troisi, Richard Poling, Shelley Dalmau and Jennie Randall (BBNW); and James Parker (DWT)
Call to Order
Chair Brian Roy called the meeting to order at 9:01 a.m.
Roll Call
Roll call was taken.
Review and Approval of Minutes
Meeting minutes from the January 26, 2017 PURMIT Board of Trustees meeting were reviewed and discussed.
Action:
A motion was made by Mr. Hagemann to approve the January 26, 2017 minutes. The motion was seconded by Mr. Hughes. The motion carried with no objections.
Financial Review as of March 31, 2017
Ms. Sattler of Berkley Risk presented PURMIT’s operating results and financial position as of March 31, 2017 to the Trustees. On a combined basis, PURMIT’s net position as of March 31, 2017 was
$3.4 million. Ms. Sattler noted that the performance of the Property component of the financial statement was showing a decrease from prior years due to increased loss activity with this line of business. Budget remains on track for the 2017 year and no recommendations for change were requested. Ms. Sattler also presented the projected fiscal year end Statements of 25% Regulatory Requirement slide, which shows PURMIT’s continued compliance with Oregon statutory requirements. PURMIT continues to exceed the minimum surplus requirement. Ms. Sattler also presented the Financial Condition Monitoring Report which continues to show improvement year over year and through March of 2017. Ms. Sattler commented that the continued improvement with these insurance metrics show PURMIT’s continued discipline with reserve setting and cost allocations
Action:
No action taken at this time.
Financial ProForma Update and Discussion
Ms. Sattler provided the quarterly Proforma update, noting that the Trust’s financial condition and projections continue to improve. Berkley continues to monitor losses and operating costs as part of the ongoing financial management of the Trust. The Proforma will continue to be updated based on the most current loss and expense figures. Ms. Sattler also presented the updated financial metrics that Berkley will use to show the Trust’s financial performance. Mr. Britz commented that as the Trust continues to refine their focus regarding surplus expectations and intent, Berkley will model different scenarios and projections which will assist the Trust establishing the desired surplus position.
Action:
No action taken at this time.
Service Provider Contracts – K Financial, PricewaterhouseCoopers, Berkley Risk
Mr. Britz noted that K Financial has proposed to renew the existing contract for a one-year term at the expiring terms and pricing. K Financial has performed the audit work for the past two years for the Trust. It was agreed that PURMIT would retain K Financial to perform the audit for the 2016 fiscal year. PricewaterhouseCoopers has been the PURMIT actuary for several years. PricewaterhouseCoopers proposed to PURMIT a three year contract that outlined terms and pricing. The Board discussed and decided to take no action as to PricewaterhouseCoopers for the upcoming reserve study but to also explore other actuarial firm possibilities to ensure the work performed, terms and conditions are in line with what other actuarial firms are producing in the future. Mr. Britz noted that Berkley Risk had submitted their intent to renew to James Parker within the guidelines of the existing contract. The renewal terms and conditions remain consistent with the expiring agreement. Mr. Roy commented that he appreciated the administration work that had been performed by Berkley Risk since their inception. Mr. Hughes made a similar comment regarding the administration portion of the agreement. In regards to claims, Mr. Hughes requested the ability to have the Board discuss the roles and responsibilities of the Berkley claims staff and process , with the entire PURMIT Board of Trustees to ensure appropriate direction is given and to identify focus areas for Berkley Risk.
Action:
No action taken at this time.
PURMIT July 1, 2016 Actuarial Review
Kevin Wick from PricewaterhouseCoopers presented the July 1, 2016 actuarial findings. Overall, PURMIT’s losses and reserves continue to develop as expected. The benefits of pooling member experience continues and is evidenced through the loss projections as well as the ability to purchase excess coverage at attractive and predictable attachment points. Mr. Wick also commented that the Trust’s net position continues to increase at a steady pace. Mr. Hughes and Mr. Wick discussed the confidence level used in the analysis. Mr. Wick thanked PURMIT for their continued confidence and partnership in Pricewaterhouse Coopers as the Trust’s actuary.
Action:
No action taken at this time.
Berkley Risk Claim Authority
The Trustees discussed and outlined the claim reporting guidelines to be instituted to keep the Trustees aware of specific adverse claims that may have a significant financial impact to PURMIT.
Action:
Mr. Roy made a motion (1) authorizing Berkley Risk to reserve and settle claims within PURMIT’s retained layer and (2) requiring Berkley Risk to report to the Board of Trustees at the next regular meeting, all claims reserved at or settled for $200,000 or more. The motion was seconded by Mr. Hagemann. The motion passed with no objections.
Legal Counsel Items
Mr. Parker discussed the following items:
- Brown & Brown Northwest contract has been finalized and signed by all
- The PURMIT banking agreement with Oregon State Treasury has been approved by the Department of Justice and is ready for signature by PURMIT. Mr. Roy reiterated the Board’s stated goal of joining the Oregon Public University Fund for PURMIT’s investments. Mr. Britz commented that the long term plans remain and work continues to access the Public University Fund.
Other items
No other items were discussed.
Action:
No action taken at this time.
The Board adjourned the regular meeting and went into Executive Session at 10:46 a.m. to address documents and information relating to PURMIT trade secrets and attorney-client communications relating to the 2017 – 18 allocation model, handling of PURMIT documents and potential and/or current litigation. The executive session was held pursuant to ORS 192.660(2)(f) and ORS 192.660(2)(h).
The Board exited Executive Session at 2:55 p.m.
Final Decisions Related to Executive Session Discussions (if any)
There were no final decisions made related to Executive Session discussions. The next PURMIT Board of Trustees meeting is scheduled for June 6, 2017.
Adjourn
The Board adjourned the meeting at 3:01 p.m.