NU Online News Service, May 22, 10:20 a.m. EDT--An independent banks self-insurance group being formed in California said it expects to realize savings of 20 to 30 percent on workers' compensation costs.
Creation of the Independent Banks Self-Insurance Group, or IB-SIG, follows the lead of other groups in the state which have formed SIGs. Those include public entities, two auto groups, and a group of private schools, Kim Santin, executive director with Bickmore Risk Services, administrator of the bank SIG, told National Underwriter.
"Workers' compensation costs are one of our highest priorities to decrease expenses at our bank," Mark Day of NVB Business Bank of Woodland said in a statement. The formation of a bank self-insurance group, he said, "makes sense not only to control costs, but also to take even greater advantage of the recent state workers' compensation reforms."
IB-SIG--which recently received approval from the FDIC--will provide the umbrella organization under which the member banks will operate. Since 1993 state regulations have allowed two or more employers within the same industry to form a nonprofit mutual benefit corporation to self-insure workers' comp, according to Bickmore.
Ms. Santin said that about 27 cents of every dollar will go to excess coverage and general administration of the SIG and the rest will fund claims.
She added that members will control operation of the SIG. Members will adopt loss control measures, have site inspections, and work with loss control experts who will help them lower costs and create a safer work environment.
She added that the biggest obstacle in forming the SIG has been getting approval from the FDIC--an effort that began in January 2004. The SIG, she said, is currently being marketed to banks throughout California, with "hopefully a July 1 go-forward date."
For more information visit www.bickmoreriskservices.com.
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