The Application Process

Not every applicant can join the fund. All potential members are underwritten by the fund administrator. If the applicant meets the basic underwriting guidelines, the information is submitted to the full Board of Directors for their formal approval. If the Board approves the member, a quotation is released to the applicant. If the applicant accepts the pricing, the final approval for entry into the Fund is provided by the Minnesota Department of Commerce.

Reduction of group experience modification from 1.73 to 1.12 producing annual savings of $25,000 on WCRA premium.

Although this process is more involved than purchasing Workers’ Comp through the standard market, it determines if an applicant is an underwriting fit for the Fund and provides existing members the assurance that not everyone is allowed to join the Fund.

The benefits of choosing GMSIF
  • Overall lower rates - Rates are based on the group’s actual claims history. Rates are developed annually by an independent actuary. These rates are then formally set by the Fund’s Board of Directors, which is elected by the members.
  • Lower Cost of Losses / Lower Claims Costs - The group contracts with a qualified and state certified Third Party Claims Administrator to effectively manage the claims process and help reduce the overall cost of loss.

Self-insured groups protect themselves against large losses through the purchase of an insurance product called excess insurance. In Minnesota, every insurance company and self-insured is required to purchase specific excess insurance from a state-mandated source called the WCRA. Specific excess insurance takes over the payments on a single claim occurrence once it reaches a pre-set amount. In addition to specific excess insurance, Greater Minnesota also purchases aggregate excess insurance. Aggregate excess insurance takes over the payments when the total of all claims in one year exceed a pre-set amount.

Prior to 2008, the aggregate insurance was purchased from standard carriers, but the very favorable loss experience of Greater Minnesota and other self-insured groups was not being rewarded. The price for the coverage was too high and the point at which the coverage would kick in was unreachable. In 2008, Greater Minnesota aligned with six other self-insured groups and pooled their aggregate insurance exposure together in a company (ASIG) founded and owned by the seven self-insured groups. The Board Chair of Greater Minnesota also sits on the board of ASIG. Under this structure, each group receives the protection of the aggregate coverage, but at lower cost and better terms. Most importantly, as an owner of the company, Greater Minnesota shares in the profits generated by ASIG. In its first three years of operation, the ASIG has generated over $500,000 of profits of which a share will ultimately be returned to Greater Minnesota or used in place of future aggregate excess premiums.

Community Memorial Hospital

"While we have seen steady premium decreases and stability in coverage, the main benefits we have from being a part of GMSIF are the peer sharing of best practices and the most comprehensive service we’ve ever had. These are the factors that have helped us strengthen our safety program, driving down our mod rate and truly improving our workplace safety record. This benefits employee morale and the bottom line. I highly recommend GMSIF to any healthcare organization interested in creating a safer workplace and reducing their work comp expense."

Community Memorial Hospital
Rick L Breuer