FWCJUA Reinsurance Committee Meeting Report: April 3

On Thursday, April 03, 2008, the Florida Workers Compensation Joint Underwriting Association (“FWCJUA”) held a Reinsurance Committee (“Committee”) meeting to discuss the reinsurance intermediary selection process and commutation matters. 

The meeting was called to order with the following Committee members in attendance: Beth Vecchioli, James Ward and Claude Revels.  Also in attendance were FWCJUA Executive Director Laura Torrence, FWCJUA General Counsel and representatives from the current FWCJUA reinsurance intermediary.

Ms. Torrence reported that while the FWCJUA is not unhappy with the services the current reinsurance intermediary has provided, it will release a Request for Qualifications (“RFQ”) to obtain proposals from reinsurance intermediaries to assist the FWCJUA with reinsurance matters for the next three years, with the option of two one-year extensions. 

In order to be considered, a respondent must meet the following qualifications:

• Be authorized to provide reinsurance intermediary services in accordance with section 626.7492, Florida Statutes
• Have at least five years experience providing general reinsurance intermediary services to companies dealing with workers’ compensation and employer’s liability insurance in Florida
• Have at least five years experience providing general reinsurance intermediary services to workers’ compensation residual markets

After discussion, it was agreed by Committee members to increase the five-year experience requirement to seven years. 

The Reinsurance Committee was appointed as the selection/evaluation committee for this RFQ, and Ms. Torrence was appointed to serve on the Committee.  Ms. Torrence also was given approval to act in the best interests of the FWCJUA in regard to respondents’ offers.

The RFQ will be released April 11, 2008.  Proposals are due May 9, 2008.  Interviews will take place on May 22, 2008, and a final decision will be made on June 11, 2008.

An update was given on a possible FWCJUA commutation with a reinsurer that is in run-off.  The company in question released an announcement this week that it has entered into an agreement with a London-based private equity firm.

The company in question has approximately $1 million in outstanding claims with the FWCJUA.  The FWCJUA will attempt to commute before the financial responsibilities of the reinsurer are assumed by the private equity firm. 

The meeting was then adjourned.

 

Should you have any questions or comments, please do not hesitate to contact this office.

 

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