Executive Director
Dewey R. Preslar, ARM
Board of Directors
Thomas R. Yarboro,
Chairman of the Board
Maxwell Family Holding Company System
Kevin F. Walsh,
Vice-Chairman
RTI International
Diane Harrington, Secretary/Treasurer
Progress Energy
Delphine D. Goines
Duke University
John Hughes
Alex Lee, Inc.
Robert Johnson
Century Furniture Industries, Inc.
Mary Kossel
Food Lion, LLC
Thomas R. Krebs
Blue Cross and Blue Shield
of North Carolina
Tia Schweikert
Lowe’s Companies, Inc.
Carla J. Stevens
WakeMed
Christine Carroll
Piedmont Natural Gas
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February 1, 2011
To: North Carolina Member Self-Insurers
From: Dewey Preslar, Executive Director North Carolina Self-Insurance Security
Association ("Association")
Re: 2010 Association Aggregate Security System ("2010 AASS")
It has been a transformative year for the Association. The leadership of the Association has been engaged in a process of discernment to better address the needs of the self-insurance industry. Although there were two insolvencies of current and former member self-insurers in December 2010, the Association is poised and ready to respond to all exigencies affecting member self-insurers.
As a result of collaborative efforts, on November 15, 2010, the Commissioner of Insurance approved the 2010 AASS which provides for expansive aggregate security for a greater number of member self-insurers than in prior years. In fact, all self-insurers that have been licensed in North Carolina for more than one year are participating in the 2010 AASS.
The leadership of the Association determined that the member self-insurers' aggregate portfolio would be afforded the greatest possible protection through a blended program. Therefore the 2010 AASS included the purchase of certain financial guarantees together with a reinsurance contract that provides comprehensive coverage for all member self-insurers. The Implementation Plan approved by the Commissioner of Insurance allowed the Security Association to expand participation in the 2010 AASS, assume an acceptable level of risk and maintain low assessments.
Certain member self-insurers that were excluded from participation last year were invited to be part of the aggregate portfolio in 2010. In accordance with N.C. Gen. Stat. § 97-185(a1), participation in the 2010 AASS is required unless a member self-insurer is excluded from participation by the Board. Excluded self-insurers are required by law to post statutory deposits. The Department of Insurance authorized the release of statutory deposits for each participating member of the 2010 AASS upon payment of its assessment. The assessment was based on the member self-insurer credit rating and its pro-rata share of the aggregate workers' compensation liabilities. This year, the leadership reduced the 2010 assessment index by five-percent (5%) from 2009.
In conclusion, the 2010 AASS allowed for increased participation at decreased costs to members while assuring an effective safety net against potential insolvencies.
2009 AASS
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