Hundreds of NH towns and school districts forced to find new insurance following state order - CONCORD MONITOR ARTICLE
Concord Monitor December 29, 2015
Property-Liability Trust cannot issue or renew insurance policies beyond June 30, 2016, after an independent hearing officer determined the embattled public risk pool is not financially viable.
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The decision effectively shutters Property-Liability Trust, which provides property liability, workers’ compensation and unemployment compensation insurance to municipalities and school districts across New Hampshire. The public risk pool has 291 members – including several towns in the Concord area – that must find new coverage.
Property-Liability Trust is one of two public risk pools, along with HealthTrust, that used to make up the former Local Government Center. The Local Government Center was dissolved in 2013 after regulators found it improperly withheld $33 million from member communities and illegally transferred money between its risk pools.
Under a recent settlement with the state Bureau of Securities Regulation, Property-Liability Trust was required to seek permission before issuing or renewing its coverage policies. Its request to do so was denied in November by hearing officer Donald Mitchell. The Bureau of Securities Regulation, which is part of the secretary of state’s office and monitors public risk pools, opposed the petition.
Mitchell found Property-Liability Trust inflated its financial position by about $1.5 million and unnecessarily raised workers’ compensation rates to support its property liability coverage line, according to an order dated Nov. 21. The order also questioned whether HealthTrust still subsidized Property-Liability Trust, by acting as its finance department and providing its human resource services, among other things.
Former state Senate president Peter Bragdon was hired as executive director of HealthTrust in 2013, a job he took at the expense of his Senate leadership post. He left that position in September, and he continues to be paid until June 2016, according to reports by the Associated Press.
Property-Liability Executive Director Wendy Lee Parker wrote in a letter to members that her organization doesn’t agree with certain assertions, characterizations and conclusions made in the order. During the hearings, Property-Liability Trust said its financial plan showed the public risk pool was able to pay all claims and rebuild its financial footing.
The decision prohibits Property-Liability Trust from conducting any new business, but the public risk pool will be kept in “runoff” and take care of existing claims, a process that can last years. Property-Liability Trust is currently projecting it will close out its last claim by 2029, Parker said.
She said Property-Liability Trust will continue to help its members find new coverage.
Several municipalities and school districts in the Concord area are members of the public risk pool.
Pittsfield selectmen will decide between two new insurers at a meeting today. Dunbarton has already switched its property liability coverage from Property-Liability Trust to Primex, at an annual savings of roughly $1,200, according to Town Administrator Line Comeau.
(Allie Morris can be reached at 369-3307 or at email@example.com.)