HomeMy WebLinkAbout13.b. Receive Fiscal Year 2020-21 Risk Management Annual Report Page 1 of 42
Item 13.b.
CENTRALSAN
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CENTRAL CONTRA COSTA SANITARY DISTRICT
April 21, 2022
TO: HONORABLE BOARD OF DIRECTORS
FROM: SHARI DEUTSCH, RISK MANAGEMENT ADMINISTRATOR
REVIEWED BY: PHIL LEIBER, DIRECTOR OF FINANCE AND ADMINISTRATION
ROGER S. BAILEY, GENERAL MANAGER
SUBJECT: RECEIVE FISCAL YEAR 2020-21 RISK MANAGEMENT ANNUAL REPORT
Attached is the Fiscal Year 2020-21 Risk Management Annual Report and presentation for review and
discussion.
Strategic Plan re-In
GOAL ONE: Customer and Community
Strategy 2—Maintain a positive reputation
GOAL THREE: Fiscal Responsibility
Strategy 1—Maintain financial stability and sustainability
GOAL FIVE: Infrastructure Reliability
Strategy 3—Protect personnel and assets from threats and emergencies
GOAL SEVEN:Agility andAdaptability
Strategy 2—Plan ahead for scenarios of direct adverse impacts
ATTACHMENTS:
1. Risk Management Annual Report FY 2020-21
2. Presentation
April 21, 2022 Regular Board Meeting Agenda Packet- Page 74 of 135
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Risk Management Division
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Annual Report
Ok Fiscal Year 2020-21
April 21, 2022 Regular Board Meeting Agenda Packet- Page 75 of 135
Page 3 of 42
INTRODUCTION
We are pleased to present the Risk Management Division Fiscal Year (FY) 2020-21
Annual Report. Risk Management's role is to protect Central San from unexpected loss
or damage, and to minimize the impact of adverse events that occur. This requires Risk
Management staff to be proactive and to maintain a constant state of readiness. The
following report details some of the ways we've met that challenge.
Risk Management also plays a role in helping Central San meet its strategic goals.
Each section of this report references the FY 2020-22 Strategic Plan goals that it
supports.
In addition to the items discussed in this report, Risk Management does a number of
things to protect Central San that aren't as apparent. Examples of these services
include pre-bid risk assessments of capital projects, insurance and indemnity reviews
for both capital and operational contracts, coordination with excess insurers for both
underwriting and claims management, evaluation of insurance and other risk financing
measures to manage the risks of new programs and providing litigation support to
District Counsel as needed.
Our ability to manage risk at Central San has, and will always, depend on our ongoing
partnership with management and staff. These partnerships help us to identify new and
emerging risks, to improve how Central San accepts and transfers risk, and to control
and reduce risks to our employees and our operations.
Thank you all for your continued support and commitment to these efforts.
Shari Deutsch Laci Kolc
Risk Management Administrator Risk Management Specialist
Risk Management Division Annual Report FY 2020-21 1
April 21, 2022 Regular Board Meeting Agenda Packet- Page 76 of 135
Page 4 of 42
Table of Contents
ExecutiveSummary ------------------------------------------------------------------------------------------------------------ 3
Insurance and Risk Financing --------------------------------------------------------------------------------------------5
Workers' Compensation Claims --------------------------------------------------------------------------------------- 7
LiabilityClaims ---------------------------------------------------------------------------------------------------------------------16
Other Risks and Exposures -------------------------------------------------------------------------------------------- 22
Enterprise Risk Management ----------------------------------------------------------------------------------------- 25
Security-------------------------------------------------------------------------------------------------------------------------------- 27
EmergencyManagement--------------------------------------------------------------------------------------------------28
Total Cost of Risk 31
StrategicPlan Metrics---------------------------------------------------------------------------------------------------------33
Risk Management Division Annual Report FY 2020-21 2
April 21, 2022 Regular Board Meeting Agenda Packet- Page 77 of 135
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Executive Summary
Workers' Compensation: In FY 2020-21, Central San incurred five medical-only claims,
and one indemnity claim compared to five medical-only claims and five indemnity claims
in FY 2019-20. Other significant results include the following:
• A noted reduction in the number of strain/sprain injuries over time;
• Further adverse loss development for prior year injuries resulted in another
Experience Modifier (ExMod) increase, which will increase premium costs until
claims from that year are removed from the ExMod calculation.
Overflow Claims: Central San has seen an overall reduction in overflow claims from a
high of 27 in FY 2001-02 to generally less than ten claims per year since FY 2010-11.
In FY 2020-21 there were 5 overflow claims, three fewer than the preceding year. Most
of these were small matters which were closed with minimal property damage. As a
result, the FY 2020-21 average cost per overflow claim remains well below our
benchmark of $25,000.
Overflow Claims IN W&4, 2020-21
Number 4 6 8 5
Total Cost $102,557 $51,660 $180,302 $40,631
Average Cost Per Claim $25,639 $8,610 $22,538 $8,126
Other Liability Claims: Claims in this category increased in both frequency and severity,
raising the average cost per claim from $5,182 in FY 2019-20 to $7,984 in FY 2020-21.
This is discussed in more detail later in this report.
Property Losses: Central San incurred one property losses in FY 2020-21 for $15,482.
The balance of expenses allocated to this program were spent on disinfection of work
spaces each time an on-site employee tested positive for COVID-19.
The following table summarizes claims costs for FY 2020-21 as compared to the
preceding year.
Risk Management Division Annual Report FY 2020-21 3
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Claim p Cost FY 2019-20 Cost FY 2020-21
Liability —Auto $1,000 $9,856
Liability - Overflows $180,302 $40,631
Liability— Plumbing $244 $1,532
Liability — Other $46,638 $55,891
Property $54,573 $66,974
Auto Physical Damage $10,516 $9,228
Enterprise Risk Management (ERM): ERM establishes a more systematic and
organization-wide process to identify, evaluate, mitigate and monitor risk. The ERM
team meets twice per year to update, re-evaluate and prioritize items on its strategic risk
register, and then identifies potential mitigations to reduce or control those risks.
Results of these team meetings are presented to the Board shortly thereafter. The top
ten strategic risks as of June 30, 2021 are shown on page 26.
Security: Staff continued to work toward implementation of the Security Master Plan
and, with the assistance of the Security Committee, made additional improvements to
security systems, procedures and practices.
Emergency Management: COVID-19 again prevented Central San from conducting on-
site exercises or drills this year. However, staff was able to augment the emergency
communications media and recommend relevant online training classes to others.
Total Cost of Risk: The Total Cost of Risk (TCOR) is a risk management industry
benchmark that allows an organization to evaluate the cost of its Risk Management
program over time. TCOR includes the cost of Central San's Safety program, as well as
Risk Management program administration, claims, and insurance premiums. This total
is reduced by any revenue accrued or funds recovered by the Self-Insurance Fund.
The TCOR for FY 2020-21 was $3,361,089, an increase of over $200,000 from the
previous year. This increase was the result of higher insurance premiums. However,
the overall TCOR trend remains generally flat, as shown on page 32.
Risk Management Division Annual Report FY 2020-21 4
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Insurance and Risk Financing
GOAL 3: FISCAL RESPONSIBILITY
STRATEGY 1 —MAINTAIN FINANCIAL STABILITYAND SUSTAINABILITY
Liability Insurance Coverage
Central San purchases commercial liability insurance for Workers' Compensation,
Employers' Liability, Excess General Liability, Pollution Legal Liability, Employment
Practices Liability, and Fiduciary Liability.
Workers' Compensation: Central San participates in the California Sanitation Risk
Management Authority (CSRMA) Workers' Compensation insurance pool, a joint
powers authority comprised of over 50 sanitary districts within California. Risk
Management staff serves as Central San's representative on the Authority's Board of
Directors. Insurance Premium Cost - $752,074.
Excess General Liability: This policy covers claims in excess of Central San's $500,000
retention up to $15 million. Coverage includes defense and indemnification for inverse
condemnation. Insurance Premium Cost - $433,515.
Pollution Legal Liability: This policy covers claims and losses arising from the collection
and disposal of household hazardous waste. It applies only to the Household
Hazardous Waste Collection Facility and non-owned disposal sites. It does not cover
claims alleging pollution conditions arising from the operation or maintenance of the
collections system. Insurance Premium Cost - $71,148.
Employment Practices Liability: This is a gap policy that reduces the self-insured
retention for employment-related claims from $500,000 to $35,000 per occurrence. The
policy is limited to $500,000 in coverage as the Excess General Liability policy will
respond to claims that exceed this amount. Insurance Premium Cost - $16,751.
Fiduciary Liability: This policy protects Central San from claims filed by participants in
District-maintained retirement and other post-employment benefit funds. Insurance
Premium Cost - $4,223.
Property Insurance Coverage
Central San purchases property insurance and crime insurance.
Property Insurance: Central San is self-insured for damage to its property and facilities
up to $250,000 per occurrence. Insurance coverage for losses in excess of this
retention is purchased through the Alliant Property Insurance Program (APIP), a group
purchasing program administered by Alliant Insurance Services. The APIP policy
includes Boiler and Machinery coverage, and Cyber Liability coverage.
Risk Management Division Annual Report FY 2020-21 5
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This program includes Identity Theft coverage for all Central San employees. Insurance
Premium Cost - $245,166.
Crime Insurance: This policy covers losses caused by employee theft, forgery or
alteration, funds transfer fraud and certain types of computer fraud. It does not cover
cyber-attacks or loss of data. Insurance Premium Cost - $1,962.
All Central San insurance policies renew on July 1 of each year.
Self Insurance Fund
Central San has at least partially self-insured most of its liability and some of its property
risks since July 1, 1986, when the Board approved the establishment of the Self-
Insurance Fund (SIF).
In 1994, the Government Accounting Standards Board issued Statement No. 10
(GASB-10) which established requirements on how public agencies must fund their self-
insured risks. To comply with GASB-10, Central San segregated reserves for certain
types of liability risks into a sub-fund that must be actuarially reviewed at least every two
years. The next actuarial study will use loss data through June 30, 2022.
In 2014, the Board established a reserve policy to maintain reserves for losses covered
by excess liability insurance of at least three times the amount of Central San's self-
insured retention. With the current retention of$500,000, this reserve is $1.5 million.
Retained losses and claims expenses are paid from this fund during the year. The fund
is replenished annually after the Board adopts the Self Insurance Fund budget via
transfer from the Operations and Maintenance Fund. During October 2020, the Board
directed $0.1 million from FY 2019-20 O&M variances to replenish this fund to the policy
required level in advance of the budget process.
The Board also wanted to reserve funds for catastrophic losses or emergency response
and sought to simplify reserving for all risks that do not require GASB-10 compliance by
consolidating other liability claim reserves and property loss reserves into a single fund.
In order to meet these goals, the balance of the SIF has been consolidated into a single
sub-fund with a $5 million reserve.
Other claims and program expenses are paid from this fund during the year. The fund
is replenished annually after the Board adopts the Self Insurance Fund budget.
Risk Management Division Annual Report FY 2020-21 6
April 21, 2022 Regular Board Meeting Agenda Packet- Page 81 of 135
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Workers' Compensation Claims
GOAL 3: FISCAL RESPONSIBILITY
STRATEGY 1 —MAINTAIN FINANCIAL STABILITYAND SUSTAINABILITY
Claim Types
Workers' Compensation claims are classified as either Medical Only (MO) or Indemnity
(IND) claims.
MO claims are those where employees only need medical treatment to cure or relieve
their injuries. In these circumstances injured employees did not lose any time from work
and fully recovered.
IND claims are those where injured employees received ongoing medical treatment
and:
• were taken off work by their treating physician,
• were given permanent physical restrictions and/or,
• suffered some permanent disability or physical limitation as a result of their injury.
Summary of Recent Claims
The following table shows the distribution of Workers' Compensation claims for
FY 2020-21, and the two prior years. The Claim Count column indicates the number of
claims occurring during the year. The Claim Costs column shows the total cost of those
claims to date.
2020-21
W77777
Claim Claim Claim Claim Claim Claim
Count Costs Count Costs Count Costs
Medical Only 10 $15,557 5 $10,884 5 $1,369
Indemnity 1 $24,393 5 $283,173 1 $22,045
Total 11 $39,970 10 $294,056 6 $23,414
Risk Management Division Annual Report FY 2020-21 7
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The following tables detail these totals by functional group.
Claims Frequency (number of claims filed per FY)
MO IND MO IND MO IND
FY 2018-19 FY 2019-20
ADM - 1 - - - -
CSO 4 - - 2 3 -
ENG 3 - - 1 - -
POD 3 - 5 2 2 1
Total 10 1 5 5 5 1
Claims Severity (incurred costs for all claims per FY)
MO IND MOIND MO IND
MO *
ADM - $24,393 - - - -
CSO $6,020 - - $4,998 $1,369 -
ENG $2,001 - - $1,162 - -
POD $7,557 - $10,884 $277,013 - $22,045
Total $15,577 $24,393 $10,884 $283,173 $1,369 $22,045
Trends and Analysis
Since Central San has very few Workers' Compensation claims in any single year, it is
difficult to identify loss trends with such a small data set. As a result, the following
analysis incorporates Workers' Compensation claims data from the last five years.
Medical Only (MO) Claims: The chart below shows the total number and cost of MO
claims by functional group for the last five years. The following table shows the average
cost per MO claim for each group during that same period.
Risk Management Division Annual Report FY 2020-21 8
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Medical Only Claims - Last 5 Years
$100,000 - 19 20
$90,000 - 18
$80,000 - 16
$70,000 14
$60,000 12
$50,000 10
$40,000 8
$30,000 6
$20,000 4
i
$10,000 2
1
$- 0
ADM CSO ENG POD
ENG includes HHWCF and Environmental Compliance
ADM CSO ENG POD
5 Yr • $585 $4,728 $11,880 $1,579
Collection System Operations (CSO) had the highest number of MO claims (19) during
FY 2020-21. The average cost per MO claim is unusually high for both CSO and
Engineering. At this time, the higher average cost per claim results from open medical
reserves. We hope to see a reduction in these averages by next year.
Indemnity (IND,) Claims: The following chart shows the total number and cost of
Indemnity claims by functional group for the last five years. The costs include medical
expenses and other payments made by the program (i.e. temporary disability payments
to employees while off work). The following table shows the average cost per IND claim
for each group during that same period.
Risk Management Division Annual Report FY 2020-21 9
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Indemnity Claims - Last 5 Years
$500,000 6
$450,000
$400,000 5 5
$350,000
4
$300,000
$250,000 3
$200,000
$150,000 2
$100,000
is 1
$50,000
$— M000000 0
ADM CSO ENG POD
. ADM CSO ENG POD
$24,393 $65,206 J- $54,469 $94,988
These results also illustrate the limitations of a small data set when looking for trends.
The single Administration (ADM) claim was relatively minor when compared to the
overall population of IND claims. During this same time, CSO and Plant Operations had
each had five claims but CSO's claims averaged $65,206 each while POD's claims
averaged $94,988 each.
Staff in POD has worked hard to increase the number of Temporary Modified duties
opportunities among its work groups. POD management and Risk Management are
hopeful this will lead to a reduction in their average cost per IND claim over time.
When all IND claims over the last five years are consolidated, the average cost per
claim remains just under $71,000. In contrast, the consolidated average cost of a MO
claim over the last five years is just over $4,200.
Improving Outcomes
In FY 2020-21 Central San continued to offer two tools implemented in FY 2019-20 to
improve outcomes for injured employees.
On-Call Nurse: Central San implemented a Nurse First Call Program which allows a
nurse to triage non-emergency injuries over the phone before medical treatment can be
provided. Employees now get direction from an objective medical professional
Risk Management Division Annual Report FY 2020-21 10
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regarding their immediate and ongoing treatment needs. This service also routes
detailed injury information to the clinic to inform subsequent treatment.
Medical Provider Network (MPR): Central San joined a MPN to provide employees
greater access to medical specialists. After seeing a doctor at a clinic, an injured
employee can follow up with any doctor in the network rather than wait for a referral to
be approved. Treatment modalities are still subject to review as defined by law.
Over time, these programs may reduce overall claims costs but for now we are
confident that speedy medical advice, faster treatment and a wider selection of
providers will improve services to injured employees.
Cost Drivers
Even with a small data set, it is clear that IND claims are significantly more expensive
than MO claims, as shown in the following chart.
Total Incurred Cost
Last 5 Years - Medical Only vs. Indemnity
$500,000
$450,000 $474,940
$400,000
$350,000
$300,000 $326,031
$250,000
$200,000
$150,000
$100,000 _
$50,000
$- $89,827
ADM $47,521 $22,102
CSO
ENG
POD
Since IND claims account for 83% of total claim costs yet only make up 25% of claims
filed, our Safety staff are essential in helping to prevent the type of injuries that become
IND claims.
Risk Management Division Annual Report FY 2020-21 11
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Also, IND claims usually include time away from work, resulting in additional `soft' costs
associated with these injuries that cannot be captured by claims data. These include
lost productivity, overtime for other staff needed to fill in while an injured employee is off
work, paid time off to attend medical appointments, and supplemental benefit costs
including salary continuation provided to augment temporary disability payments.
Expert opinions vary on the scope of these soft costs but estimates range from three to
five times the claims cost. Considering that indemnity claim costs for the last five years
exceeded $1,000,000, this equates to $3 million to $5 million in soft costs incurred by
Central San.
Since IND claims are so costly, Risk Management, Safety and Human Resources staff
work collaboratively with injured employees and their supervisors to reduce the amount
of time employees lose from work, to ensure employees receive ongoing and proper
medical treatment, and to help employees recover as soon as possible. In many cases,
these efforts prevent MO claims from becoming IND claims.
Indemnity Claims Classification
As noted above, IND claims constitute the most severe injuries and are the primary cost
driver in Workers' Compensation losses. Safety staff works with managers and
supervisors to identify the root causes of injuries and accidents to reduce the frequency
and severity of injuries to employees. These loss control activities are addressed more
fully in the Safety Annual Report provided after the end of each calendar year. The
following charts provide an overview of IND claims by injury type, cause, and affected
body part(s).
Combined IND Claims by Type of Injury
Last 5 Yrs & Last 10 Yrs
Other MW
Cut/Bruise IM
Strain/Sprain
0 S 10 15 20
The overall frequency of strain/sprain injuries is evident over ten years.
Risk Management Division Annual Report FY 2020-21 12
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In the aggregate, as shown above, strains and sprains are the most common type of
injury that takes and/or keeps employees off work. However, a more granular analysis
reveals recent improvement. This is the same five-year data split out by policy year.
Indemnity Claims by Type of Injury
2020-21 -
2019-20
2018-19 ■Strain/Sprain
■Cut/Bruise
2017-18 ■Puncture
2016-17
0 1 2 3 4 5 6
While strains and sprains remain the most common type of IND claim, the
number had dropped significantly over the last few years.
FY 2020-21 resulted in only one IND claim, although it was a strain/sprain injury.
Repetitive Motion used to be the most frequent cause of IND claims over the last ten
years, but there has only been one such claim in the last five years. Overexertion
(which includes Pushing/Pulling and Lifting/Reaching) is now the most common cause
of injury.
Selected IND Claims by Cause of Injury
Last 5 Yrs & Last 10 Yrs
Other
Repetitive Motion
Pushing/Pulling
Lifing/Reaching
0 2 4 6 8 10
Risk Management Division Annual Report FY 2020-21 13
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As with the preceding charts, data from the last five years demonstrates some
improvement, with no subsequent shoulder or knee injuries. Lower backs are still the
most commonly injured body part that result in IND claims.
IND Claims by Injured Body Part
Last 5 Yrs & Last 10 Yrs
Other
Shoulder
Foot
Back
0 2 fast 10 Yrs P Last 5 Yrs8 10
Return to Work
In 2007, Risk Management implemented a Return to Work Program to facilitate
employees' recovery from work-related injuries and to help reduce the number and cost
of IND claims. In many cases, Central San's ability to provide temporary modified duty
(TMD) can prevent a MO claim from becoming an IND claim. This makes the Return to
Work Program an essential component of both employees' recovery and cost control.
The program incorporates use of the interactive process which is required for
compliance with the Fair Employment and Housing Act (FEHA) and the Americans with
Disabilities Act Amendments Act (ADAAA).
It is not easy to compare Return to Work metrics from year to year as each potential
TMD assignment depends on the nature of each employee's physical restrictions, and
Central San's ability to offer TMD within those restrictions. In FY 2020-21, Central San
provided TMD assignments to 100% of employees who were allowed to return to some
form of modified duty.
Risk Management Division Annual Report FY 2020-21 14
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Experience Modification Factor (ExMod)
One of several factors used to calculate Central San's annual Workers' Compensation
premium is the Experience Modification factor (ExMod). CSRMA calculates each pool
member's ExMod by comparing its loss data from the preceding three prior years to the
entire pool's combined loss data for that same period. Members' ExMods are then
adjusted to align a portion of the members' premium with its' relativle loss experience.
Because the pool determines members' ExMod using a rolling three-year period of loss
data, no member is penalized for poor performance (higher than average claims
frequency or severity) in a single year indefinitely.
Workers' Comp ExMod - Last 10 Years
1.20 —
1.00 1.06 1.10
0.80 .74
0.60 .71 0.74 —
0.56 0.6r 0.0
0.40 —
0.20 — —
0.00 —
13 1� ,15 16 1�
Zp11,12 2012' Zp13, Zp1� 2015' Zp16, Zp10, Zp1$ Zp19. Zp2�
Open Workers' Compensation claims from FY 2018-19 have developed more
significantly than anticipated, which has increased Central San's loss ratio compared to
other members of the pool.
Because of CSRMA's rolling three year loss calculation, higher claims costs from this
year have been included in our formula, resulting in a further increase to the ExMod.
Since these costs will also be included in at least one more ExMod calculation, staff
anticipates a similar ExMod for the next renewal.
It is important to note that while Central San's ExMod has increased, it has not been the
primary driver of increased Workers' Compensation costs. The two largest factors in
higher prices have been increases in insurance rates and in payroll.
Overall Performance
Regardless of future ExMod impacts, staff continues to embrace Central San's
proactive approach to safety. Risk Management staff remains focused on active case
management, and other staff, supervisors and managers continue to participate in the
Return To Work Program.
Risk Management Division Annual Report FY 2020-21 15
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Liability Claims
GOAL 3: FISCAL RESPONSIBILITY
STRATEGY 1 —MAINTAIN FINANCIAL STABILITYAND SUSTAINABILITY
Claims Philosophy
Central San's focus on customer service informs its claims management process.
Claimants are contacted immediately, their claims are investigated thoroughly, and
when damages are found to be Central San's responsibility, claims are settled promptly
and fairly. This approach has resulted in generally satisfied claimants and in reduced
cost.
Liability Claim Types
We categorize self-insured liability claims into four types; Auto Liability, Plumbing
Reimbursements, Sanitary Sewer Overflows, and Other Liability claims. These claims
are all paid from the Self Insurance Fund and would be covered by Central San's
excess liability insurance if the losses exceeded the self-insured retention.
Claim costs include emergency response expenses, settlements, legal expenses and
reserves for open claims. It does not include staff time to adjust and settle claims.
Auto Liability Claims
Auto Liability claims are those filed by third parties for damages they believe Central
San personnel caused while operating its vehicles. This includes claims for injuries to
persons or damage to others' property.
These claims do not include costs to repair or replace damaged Central San vehicles
from such events. Repairs to these vehicles are paid from a different Self-Insured Fund
and discussed under the Auto Physical Damage section of this report.
The chart below shows the total number and cost of Auto Liability claims for the last five
years. There were two minor Auto Liability claims in FY 2020-21.
Risk Management Division Annual Report FY 2020-21 16
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Auto Liability Claims
$12,000 3
$10,000 2
$8,000
2
$6,000
1
$4,000
$2,000 1
$- 0
2016-17 2017-18 2018-19 2019-20 2020-21
� Total Cost Number
FY 2016-17 FY 2017-18 FY 2018-19 FY 2019-20 FY 2020-21
$4,192 $0 $3,735 $500 $4,928
Claim I
Plumbing Reimbursement Claims
Plumbing reimbursements are small claims usually made by homeowners after they
have called a plumber for service, only to learn that the problem was in Central San's
main sewer line. CSO field staff respond to these situations and often provide the
homeowner with a claim form while they are on site. This facilitates a simple
reimbursement process where Risk Management receives the claim, confirms the call-
out and the findings, then processes reasonable reimbursements.
Plumbing reimbursements do not include reimbursement requests arising out of an
overflow or any event where sewage escaped from the collection system. These
circumstances involve additional expenses and are often included as part of a larger
claim. Claims arising from these situations are considered overflow claims, which are
discussed in the following section.
The chart below shows the total number and cost of plumbing reimbursement claims for
the last five years, followed by a table showing the average cost per plumbing
reimbursement claim for each of those years.
Risk Management Division Annual Report FY 2020-21 17
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Plumbing Reimbursements
$4,000 8
$3,500 7
$3,000 6
$2,500 5
$2,000 4
$1,500 3
$1,000 2
$500 1
$- 0
2016-17 2017-18 2018-19 2019-20 2020-21
� Total Cost Number
FY 2016-17 FY 2017-18 FY 2018-19 FY 2019-20 FY 2020-21
$449 $533 $873 $224 $511
Sanitary Sewer Overflow Claims
Sanitary Sewer Overflow (SSO) claims are those filed by customers whose property has
been damaged by a sewer overflow. CSO staff respond to the overflow and contact
Risk Management when they become aware of an overflow that causes property
damage. This allows Risk Management staff to:
• respond immediately to begin coordination of emergency clean up and
remediation as needed;
• provide for affected customers' immediate needs;
• work with the customers to define damages;
• help customers prepare their claims; and
• settle the claims in a timely and reasonable manner.
This process has evolved into a partnership between CSO and Risk Management staff
that benefits both Central San and our customers.
The following chart shows the total number and cost of overflow claims for the last five
years, followed by a table showing the average cost per overflow claim for each year.
Risk Management Division Annual Report FY 2020-21 18
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SSO Claims
$200,000 10
$180,000 9
$160,000 8
$140,000 7
$120,0006
$100,000 000000– 5
$80,000 4
$60,000 3
$40,000 2
$20,000IF—Ai1
1
$- 0
2016-17 2017-18 2018-19 2019-20 2020-21
� Total Cost Number
FY 2016-17 FY 2017-18 FY 2018-19 FY 2019-20 FY 2020-21
$13,777 $25,639 $8,610 $25,757 $8,126
Staff benchmarks sanitary sewer overflow claims costs against the average cost per
overflow claim incurred by the CSRMA general liability insurance pool. Although
Central San does not participate in this pool, its loss data presents a relevant
benchmark for comparison. As of the last available data, CSRMA's average cost per
overflow claim is about $20,000. Central San has outperformed this benchmark three of
the last five years.
Thanks to the partnership with CSO and the ongoing support of management and the
Board, it is not uncommon for staff to resolve sanitary sewer overflow claims at a lower
cost than that of Central San's peers. Larger overflow claims do occur, although
infrequently, but any overflow claim can develop into a significant loss, even when
addressed in a timely, thoughtful and professional manner.
Other Liability Claims
Other liability claims include losses arising from Central San's operations that don't
readily fit in the preceding categories. Examples of these claims include damage to
homeowners' property caused by sewer cleaning activities, damages alleged to arise
from field work, damage to other utilities' infrastructure from maintenance or
construction activities and other claims where the damaged party believes Central San
caused their loss.
Risk Management Division Annual Report FY 2020-21 19
April 21, 2022 Regular Board Meeting Agenda Packet- Page 94 of 135
Page 22 of 42
As of this year, we now use this category for claims alleging sewer overflows but that
were not substantiated via documentation or by investigation.
All such claims are investigated and, if found to be Central San's responsibility, promptly
settled for reasonable amounts. Claims found not to be Central San's responsibility are
either denied or tendered to the at-fault party.
Because these claims defy any ready classification, claims within this group fluctuate in
frequency and severity over time. A claim filed today might settle for $500 while one
filed tomorrow could exceed the self-insured retention. This makes annual comparisons
difficult.
We group these claims into a catch-all Other Liability Claims category. There is little
similarity among the claims in this group, but does incorporate litigated or complex
claims that take longer to settle and may incur reserves and legal expenses.
The chart below shows the total number and cost of these other liability claims for the
last five years, followed by a table showing the average cost per claim for each year.
Other Liability Claims
$500,000 $467,717 12
$450,000
$400,000 10
$350,000 \ 8
$300,000
$250,000 $226,551 6
$200,000
$150,000 4
$100,000 2
$50,000 ■
$- 0
2016-17 2017-18 2018-19 2019-20 2020-21
Total Cost Number
Year FY 2016-17 FY 2017-18 FY 2018-19 FY 2019-20 FY 2020-21
Avg $ per $32,364 $968 $46,772 $5,182 $7,984
Claim
Risk Management Division Annual Report FY 2020-21 20
April 21, 2022 Regular Board Meeting Agenda Packet- Page 95 of 135
Page 23 of 42
Liability Claims Overall
The following chart combines the preceding liability claim types and compares claim
costs by fiscal year and type of liability claim over the last five years.
Cost of Liability Claims by Type
2020-21
2019-20
2018-19
2017-18 6
2016-17
$ $100,000 $200,000 $300,000 $400,000 $500,000
■SSO ■PL ■OL ■AL
From this perspective, plumbing reimbursements and auto liability claims comprise a
very small portion of Central San's liability claim costs. SSO claims have a more
noticeable impact but have not increased in frequency or total cost as much in the last
few years as they have in the past. As indicated earlier, other liability claims, shown
above as `OL', fluctuate widely in both frequency and severity from year to year.
Risk Management Division Annual Report FY 2020-21 21
April 21, 2022 Regular Board Meeting Agenda Packet- Page 96 of 135
Page 24 of 42
Other Risks and Exposures
GOAL 3: FISCAL RESPONSIBILITY
STRATEGY 1 —MAINTAIN FINANCIAL STABILITYAND SUSTAINABILITY
Property Losses
Central San is self-insured for damage to its property and facilities up to $250,000 per
occurrence. Insurance coverage for losses in excess of this retention is purchased
through the Alliant Property Insurance Program (APIP), a group purchasing program
administered by Alliant Insurance Services. The APIP policy includes Boiler and
Machinery and Cyber Liability coverage. There was 1 property loss in FY 2020-21 for
$15,482.
As the chart below shows, the FY 2020-21 total cost for property losses exceeds this
amount. The balance of expenses allocated here arise from the decontamination of
work areas required when an on-site employee tested positive for COVID-19.
Decontamination expenses also account for the majority of loss costs in FY 2019-20 as
well.
Self-Insured Property Losses
$80,000 7
$70,000 $66,974 6
$60,000
5
$50,000
4
$40,000
$30,000 3
$20,000 2
$10,000 1
$- 0
2016-17 2017-18 2018-19 2019-20 2020-21
Total Cost Number
Earthquake and Flood Risks
The APIP policy does not include coverage for damages arising out of flood or
earthquake. Risk Management staff periodically evaluate the cost of insuring these
risks through the commercial insurance market. This evaluation considers recent
hazard modeling results and Central San's implementation of mitigation projects that
reduce the potential impact of earthquake and flood damage against available
insurance coverage and pricing.
Risk Management Division Annual Report FY 2020-21 22
April 21, 2022 Regular Board Meeting Agenda Packet- Page 97 of 135
Page 25 of 42
In March and June 2017, staff presented the Administration Committee with an analysis
of earthquake insurance pricing, and the results of FEMA's 2017 update to HAZUS, its
hazard model using multiple earthquake and flood scenarios. After some discussion,
the Committee decided against purchasing flood or earthquake insurance at that time.
Staff will continue to monitor hazard models and the insurance market and report back
to the Committee when more favorable options emerge.
As a result, Central San is essentially self-insured for flood and earthquake risks. To
finance this risk, the Board approved and funded a $5 million catastrophic loss fund
within the Self-Insurance Fund (SIF) to pay for emergency repairs after a natural
disaster. Central San has not suffered any catastrophic losses to date.
Auto Physical Damage
Central San is self-insured for Auto Physical Damage. Damage to other parties'
vehicles is insured by the Excess Liability policy, but the cost to repair or replace
Central San vehicles is not. If a Central San vehicle is damaged by a third party, the
SIF pays for repairs and Risk Management staff pursues cost recovery from the at-fault
party. When damage is caused by Central San staff, the SIF pays repair costs in
excess of $1,000. All vehicle repairs are coordinated through Central San's Vehicle
Shop.
The following chart shows the number and cost of Auto Physical Damage losses for the
last five years.
Retained Auto Physical Damage Losses
$14,000 6
$12,000 5
$10,000
4
$8,000
3
$6,000
$4,000 2
$2,000 1
$- 0
2016-17 2017-18 2018-19 2019-20 2020-21
Total Cost Number
Four vehicles were damaged during FY 2020-21, including one not-at-fault incident from
which we recovered our repair costs from the other party's insurance company.
Risk Management Division Annual Report FY 2020-21 23
April 21, 2022 Regular Board Meeting Agenda Packet- Page 98 of 135
Page 26 of 42
Household Hazardous Waste Claims
Central San purchases a separate Pollution Legal Liability insurance policy to cover
losses arising out of the collection and disposal of household hazardous waste. No
claims have been filed since the Household Hazardous Waste Collection Facility
opened in 1997.
Pollution Risks
Central San has chosen to self-insure pollution-related risks other than those arising
from providing the Household Hazardous Waste Facility. Coverage for such pollution
losses is either not available or extremely expensive. Claims costs arising from an
alleged pollution condition would be paid from the SIF's Catastrophic Loss Fund. No
pollution claims have been filed in over fifteen years.
Risk Management Division Annual Report FY 2020-21 24
April 21, 2022 Regular Board Meeting Agenda Packet- Page 99 of 135
Page 27 of 42
Enterprise Risk Management
GOAL 7: AGILITY AND ADAPTABILITY
STRATEGY 2—PLAN AHEAD FOR SCENARIOS WITH DIRECT ADVERSE IMPACTS
Introduced in 2004 by the Committee of Sponsoring Organizations Treadway
Commissions (COSO), Enterprise Risk Management (ERM) is a process used to
identify, assess, and respond to strategic risks that may affect an organization's ability
to meet its goals and objectives. Utilities and very large public agencies began
implementing ERM over a decade ago.
Since then, smaller public entities have gradually implemented some form of ERM.
They had enough success with the process that use of ERM has become a best
practice in public sector risk management.
ERM requires that agencies continuously identify their strategic risks, rank and prioritize
those risks for oversight, mitigation or elimination, and periodically report progress to
key stakeholders.
Central San's ERM team includes the Executive Team, Risk Management Administrator
and Internal Auditor. This group meets at least twice per year to review risk rankings, to
review mitigations and risk reduction priorities, and to identify any new strategic risks or
opportunities that may affect Central San's ability to meet its objectives.
The team scores each risk from one to ten on each of four factors; frequency, severity,
speed of onset and remaining mitigation work still to be peformed. The combined total
of these four factor is shown below.
Top 10 Strategic Risks: June 2021
35
30 —
25
20
15
10
5
0
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peg' oe�``� �QQ�J
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Risk Management Division Annual Report FY 2020-21 25
April 21, 2022 Regular Board Meeting Agenda Packet- Page 100 of 135
Page 28 of 42
The four risks shown in red each scored above 30 points, of a possible 40 points.
These represent the most significant risks to normal operation of Central San.
The other six risks are significant but scored lower on one or more of the factors, thus
resulting a potentially smaller impact than the others should they occur. Although the
relative position of the top strategic risks has fluctuated over time, the items comprising
this list have remained constant since 2019. As a result, management considers all
these strategic risks in both the strategic planning and budgeting process.
Staff presents the results of these meeting to the Board twice per year. The first report
of the year is a brief status report regarding the top risks as defined and ranked by the
ERM Team. The second report discusses developments on all strategic risks since the
preceding year.
Risk Management Division Annual Report FY 2020-21 26
April 21, 2022 Regular Board Meeting Agenda Packet- Page 101 of 135
Page 29 of 42
Security
GOAL 5: INFRASTRUCTURE RELIABILITY
STRATEGY 3—Protect Personnel and Assets from Threats and Emergencies
Risk Management is responsible for the physical security of Central San's facilities.
Day-to-day security operations includes oversight of, and coordination with, the security
guards, issuance of badges and keys to staff and the maintenance and support of the
electronic security systems including security cameras, panic buttons, burglar alarms
and related software.
Risk Management staff partners with other work groups to accomplish a variety of tasks
and projects to secure Central San property, and protect its employees and the public
from security breaches.
Major security initiatives this year included:
• Installed card readers and replaced cameras in various locations,
• Restricted open access to certain buildings, so that badges are required to
gain access. This was in response to fewer employees working on site during
the pandemic but will likely remain in place going forward.
• Expanded security guard services to address new threats and exposures.
The Information Technology Division has implemented software and tools to identify
and control unauthorized access to Central San's networks, and has developed an
education and training program to increase employee awareness and reporting of
potential threats.
Risk Management staff is also working on longer term projects including updates to
information security protocols, electronic security systems, and facility hardening
measures to protect employees and further restrict access to Central San facilities from
unauthorized parties.
Risk Management Division Annual Report FY 2020-21 27
April 21, 2022 Regular Board Meeting Agenda Packet- Page 102 of 135
Page 30 of 42
Emergency Management
GOAL 5: INFRASTRUCTURE RELIABILITY
STRATEGY 3—Protect Personnel and Assets from Threats and Emergencies ies
Central San's Emergency Management Program is comprised of four elements that
work together to ensure a prompt and effective emergency response to disasters, to
make sure such response is properly documented for potential cost recovery, and to
make permanent repairs to damaged infrastructure as soon as practicable. These four
elements are discussed below.
Plan Development and Maintenance
Risk Management is responsible for developing, maintaining and continuously
improving the Emergency Operations Plan, Local Hazard Mitigation Plan, and the
Continuity of Operations Plan.
Emergency Operations Plan: The California Emergency Services Act requires all public
entities to prepare and maintain an Emergency Operations Plan (EOP) that complies
with the Standardized Emergency Management System (SEMS). Risk Management
released and the Board adopted a major EOP update in 2010 to reflect changes in the
EOC staffing structure and to comply with the federal National Incident Management
System (NIMS).
Since then, Risk Management staff reviews the EOP at least annually and posts needed
updates to the intranet. Hard copies of the EOP are kept in the primary and backup
Emergency Operations Centers (EOCs). Additional hard copies of the plan are stored
in the emergency supplies cache.
Local Hazard Mitigation Plan: FEMA requires local governments to update their plans
every five years as a prerequisite to seek hazard mitigation grants. Central San's first
plan was adopted in 2011, and accepted by FEMA in 2012. FEMA acceptance is valid
for five years. After that, an updated plan must be submitted to maintain program
compliance.
In keeping with its commitment to coordinate emergency planning and responses with
other agencies, Central San joined with 35 other agencies to prepare a multi-
jurisdictional update to the 2012 Local Hazard Mitigation Plan. Staff served on the
Steering Committee managing this process.
The Board adopted Central San's portion of the updated plan on March 1, 2018. The
update was submitted to FEMA for review and was approved on April 19, 2018.
Risk Management Division Annual Report FY 2020-21 28
April 21, 2022 Regular Board Meeting Agenda Packet- Page 103 of 135
Page 31 of 42
Continuity of Operations Plan: The Continuity of Operations Plan (COOP) was
activated when the COVID-19 pandemic reached Contra Costa County. During
February and March 2020 staff updated and then modified the Pandemic Response
segment of the plan to keep up with the changing information and direction received
from County and State public health professionals. Since then, staff has made minor
adjustments to the plan as public health rules changed the way we work and technology
expanded the universe of alternative work spaces.
This element of the COOP should not be confused with the pandemic Exposure
Prevention Plan, which was prepared by, and is expertly maintained by, our Safety staff.
This critical document governs current work place operations under pandemic
conditions. It has been incorporated into the Pandemic Response section of the COOP
as a deliverable within the overall response protocol.
Emergency Action Plan: The Emergency Action Plan (EAP) is required by CalOSHA
and details the specific responsibilities and procedures to follow if Central San staff
need to evacuate or shelter in place. Since the EAP is part of the Safety Directive
catalog, responsibility for EAP maintenance, testing and exercises resides with the
Safety staff.
Training and Exercises
During the year, Risk Management usually offers training classes and conducts
exercises for emergency response staff. However, the vast majority of such events
require on-site participants in greater concentrations than are allowed under the
Exposure Prevention Plan. Instead, staff has recommended online training for
interested employees from FEMA's Online Independent Study Program.
Once most staff are back working on-site, this program will reconstitute to conduct
required exercises and drills, but will likely continue to use online training tools where
appropriate and effective.
Supplies and Equipment
Primary and Backup EOC: The Multi-Purpose Room is Central San's primary
Emergency Operations Center (EOC). The Crew Room at the CSO facility in Walnut
Creek serves as Central San's backup EOC. Both locations are designed as `warm'
sites, meaning that all needed supplies and equipment are stored on site, but must be
set up before the EOC becomes operational.
These facilities must be continuously stocked with the necessary supplies and
equipment to enable immediate set up and operation of the EOC. Risk Management
staff conducts inventory audits of each location to ensure that the necessary items were
available on site, secured as needed and maintained in an operable condition, including
replacement of any outdated or non-operational items. During these audits, staff also
Risk Management Division Annual Report FY 2020-21 29
April 21, 2022 Regular Board Meeting Agenda Packet- Page 104 of 135
Page 32 of 42
tests the analog phones, satellite television service and the satellite internet service to
ensure continued operability.
Communications: Contra Costa and Alameda Counties are partners in the East Bay
Regional Communications System Authority (EBRCSA), a Joint Powers Authority (JPA)
that developed and maintains an interoperable radio communications infrastructure
using the P25 standard. Central San joined this group in FY 2014-15, and purchased
its first batch of radios in FY 2016-17. The Radio Unit of the County's Department of
Information Technology has programmed all the handheld and mobile radios and
installed the mobile radios in selected Collections System vehicles.
Risk Management staff configured and now manages the Everbridge Mass Notification
Software. This allows authorized users to send messages to all employees or selected
groups through multiple communications media. The system is currently configured to
contact personnel via desk phone, email, cell phone call and then by text message,
using the next medium in the hierarchy until each person responds. If someone was not
responsive throughout the cycle, the system will wait 5 minutes then restart the cycle
until the person responds or the authorized user cancels the notification.
Central San also maintains handheld amateur (HAM) radios at both the Walnut Creek
and Martinez campus and has four licensed HAM radio operators on staff.
Coordination with Other Agencies
As a single-service agency, Central San must coordinate its emergency response with
first responders in other local governments within its service area. All local
governments in the County report incidents, damage and resource requests to the
Operational Area EOC. The Operational Area EOC is housed at the Contra Costa
County Sheriff's Office of Emergency Services (OES). The County EOC analyzes and
forwards local status reports and unfilled resource requests to the regional, state and
federal emergency management coordinators.
Risk Management staff continues to serve on the Operational Area Council, a group of
emergency managers from within the County who meet quarterly to share information
and best practices, coordinate multi-agency drills and training opportunities, and
facilitate coordinated area emergency planning. The Council is sponsored by the
Contra Costa County Sheriff's OES.
As the Operational Area point of contact, County OES also works with state and federal
agencies to collaborate on projects of regional or national concern. Operational Area
Council members are encouraged to participate in these larger group meetings.
Central San is also a member of the California Water and Wastewater Agency
Response Network (CaIWARN), which coordinates the distribution of members'
specialized equipment and trained personnel to other member agencies to help with
disaster and emergency response.
Risk Management Division Annual Report FY 2020-21 30
April 21, 2022 Regular Board Meeting Agenda Packet- Page 105 of 135
Page 33 of 42
Total Cost of Risk
GOAL 3: FISCAL RESPONSIBILITY
STRATEGY 1 —MAINTAIN FINANCIAL STABILITYAND SUSTAINABILITY
The Total Cost of Risk (TCOR) is a risk management industry benchmark that allows an
organization to evaluate the cost of its Risk Management program over time. TCOR
includes the cost of Central San's Safety program, as well as Risk Management
program administration, claims and insurance premiums. This total is reduced by any
revenue accrued or recovered by the Self-Insurance Fund.
FY 2020-21 TCOR is $3,361,089, an increase of$234,000 (7%) from the preceding
year.
The following chart shows Central San's TCOR for the last 10 years. The year with the
highest TCOR is shown in yellow while the year with the lowest TCOR is shown in
green.
TCOR Totals and Trend*
$5,000,000 $4,521,113
$4,500,000
$4,000,000 $2,673,249 $3,361,089
$3,500,000
$3,000,000
$2,500,000
$2,000,000
$1,500,000
$1,000,000
$500,000
$-
ti� ti� ti� tih ti� til ti00 ti� ti� titi
Totals have been adjusted for inflation
TCOR is the sum of the five categories of expenses: personnel, insurance, claims, risk
management program costs and safety program costs. The following chart illustrates
thses costs by category for the last ten years.
Risk Management Division Annual Report FY 2020-21 31
April 21, 2022 Regular Board Meeting Agenda Packet- Page 106 of 135
Page 34 of 42
TCOR Categories by Fiscal Year
$4,500,000
$4,000,000
$3,500,000
$3,000,000
$2,500,000
$2,000,000
$1,500,000
$1,000,000
$500,000
titi ti's tib` tih ti� til ti� ti� ti� titi
LQN, ti0Icl LMLO
■Personnel Insurance ■Claims ■RM Program Safety Expenses
Note 1: Chart does not include lost productivity or other soft costs arising from claims.
Note 2: TCOR segment totals have not been adjusted for inflation.
Totals for four of the five categories are determined at the end of each fiscal year.
However, claims costs often include reserves for open claims occurring in specific fiscal
years. This may result in some fluctuation of the total claims costs over time as losses
develop or claims resolve.
Risk Management Division Annual Report FY 2020-21 32
April 21, 2022 Regular Board Meeting Agenda Packet- Page 107 of 135
Page 35 of 42
Strategic Plan Metrics
Central San's Strategic Plan includes seven goals with associated strategies, initiatives
and metrics to track performance toward achieving these goals. Risk Management is
responsible for metrics under three of the goals. The tables below summarize Risk
Management's FY 2020-21 performance for the metrics associated with these goals.
GOAL 1: PROVIDE EXCEPTIONAL CUSTOMER SERVICE AND MAINTAIN AN EXCELLENT
REPUTATION
STRATEGY: SUPPORT MEMBER ORGANIZATIONS AND SISTER AGENCIES.
Year End Result
Continue participation in Support sister agencies via Mutual No requests [�}
CalWARN Aid
GOAL 3: FISCAL RESPONSIBILITY
STRATEGY: EVALUATE AND APPLY RISK MANAGEMENT PRACTICES.
-q -7 — –%
Metric Success Measure Year End Result
Maintain and report on Coordinate ERM Team, monitor
Enterprise Risk Management risk scores over time, present Ongoing (�/}
program results to Board twice per year
Provide Return to Work Provide Temporary Modified Duty
Program to at least 95% of employees 100%
injured on the job
Manage the Cost of Overflow Average cost per claim $8,126 (�/}
Claims < $25,000
GOAL 5: INFRASTRUCTURE RELIABILITY
STRATEGY: PROTECT PERSONNEL AND ASSETS FROM THREATS AND EMERGENCIES
uccess MeasurA Year End Resulti
Ensure the currency of Updated Pandemic Response
Emergency Plans section of Continuity of Operations Ongoing (�/}
Plan
Evaluate and implement Implement the Security Master
security improvements to Plan. Ongoing 0
meet new or evolving threats
Risk Management Division Annual Report FY 2020-21 33
April 21, 2022 Regular Board Meeting Agenda Packet- Page 108 of 135
Page 36 of 42
ATTACHMENT 2
mom.
RISK MANAGEMENT DIVISION
ANNUAL REPORT
- Board Meeting
April 21, 2022
Shari Deutsch
Risk Management Administrator
1
WORKERS' COMPENSATION
Medical only Claims-Last 5Years 5-year average cost per MO claim
5saaoo xs
$sumo xb
smmo is $585 $4,728 $11,880 $1,579
Scamp Sx
554mo xo
s+amo e 5 Year combined average cost per MO
ssmaw ° claim is$4,167
5xaam a
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5-year average cost per IND claim Indemnity Claims-Last 5 Years
•®®® '�r $SmpOo 6
$Om GW
$24,393 $65,206 $54,469
$94,988 saso oca
6
®� $SmpaO
$35]A0o S
$2m Oa0
5 Year combined average cost per IND $xmPao '
claim is$71,869. sxm ooa s
5suuoo
$- o
ADM Goo fNG Poo
2
1
April 21, 2022 Regular Board Meeting Agenda Packet- Page 109 of 135
Page 37 of 42
WORKERS' COMPENSATION
Total incurred Cost
Lasts Years-Medical Only vs.Indemnity
-
$450,000 $474,940
$400,000
$350.000
$300.000 $326,031
$250,000
$200,000
$150,000
$100,000
$50,000$
-
$89,
827
ADM CSO
$47,
521
ENG 522P.1D0D2
• Indemnity claims account for 94%of all Workers'Comp claims costs.
• Illustrated the need to prevent MO claims from becoming IND claims.
3
INDEMNITY CLAIMS
Combined IND Claims by Type of Injury Selected IND Claims by Cause of Injury
Last 5 Yrs&Last 10 Yrs Last 5 Yrs&Last 10 Yrs
an
Q(fIS
P®d4'veMp�pn
cutm— r
Pu9nifvun�q
sv:nrswam
��nnyPeacn�rp
0 5 .. 15 20 0 1 a 6 8 10
IND Claims by Injured Body Part Red v Blue bars—strain/sprain injuries still
Last 5 Yrs& common,but we had fewer each of the last
two years.
or v
Green v Blue bars—Injuries caused by
Sno k overexertion are becoming more common.
F� Pink v Blue bars—the lower back continues
to be the most commonly injured body part
g.k among Indemnity claims.
0 2 •610 vn�Wx SYrsg 10
= I
4
2
April 21, 2022 Regular Board Meeting Agenda Packet- Page 110 of 135
Page 38 of 42
LIABILITY CLAIMS
Auto Liability Claims Plumbing Reimbursements
s12,00 3 $4,000 8
$10.000 53.500 )
1
$5,000 6
$6,00 2 $2.500 5
56.000 $2,000
1 $1,5003
$4,000
1 $1." m I 000 1
$2,000 $500 1
$ 0 S 0
201617 2017-18 201&19 2019-zo 701917 2417-18 201919 XJ39-20 7020.11
�idalC¢G -N�nba a�TIXe[Ca4 �NumOx
Other Liability Claims
$500,000 $467,717 12
$°50.000
5°00.000 ]0
5350.000The variety of incidents,and the
5."M 6 variable frequency and severity of
$776,551 6 claims grouped into the Other Liability
sz66,eoe
$1w,ee Claims category complicates efforts to
$1al,oee z project or analyze trends.
ssa,oee
201617 2017-16 2016-19 2019-20 2020-21
_TO ICO -NU W I
5
OVERFLOW CLAIMS
SSO Claims
$200,000 - 10
5180,000 - 9
$160,000 \ 8
$140,000 7
$120,000 6
5100,000 5
160.000 4
160,000 3
540,000 2
520,000 , U
2016-17 2G17-16 2018.19 2019-20 2020-21
a>•Total Con —Number
_ ,' Fy 2016-17 FY 2017-18 FY 2018-19 FY 2019-20 FY 2020-21
i
573,777 S25,fi39 58,610 $25,757 58,126
6
3
April 21, 2022 Regular Board Meeting Agenda Packet- Page 111 of 135
Page 39 of 42
ENTERPRISE RISK MANAGEMENT
Top 10 Strategic Risks: June 2021
35
30
25
20
15
10
5
0
Lce �4
J�e
ati�
5 yap SSS c`\c�
• Each risk is scored on four factors:
Frequency,Severity,Speed of Onset,Mitigation Still to Do
• Each factor is scored from one to ten. Maximum score for each risk is 40.
• Risks in red scored over 30,risks in orange and yellow scored between 23 and 27.
1
7
SECURITY
• Upgraded video analytics software
• Expanded duties of security guards.
• Made further progress toward scoping the
next Security Improvement Project
s
4
April 21, 2022 Regular Board Meeting Agenda Packet- Page 112 of 135
Page 40 of 42
EMERGENCY MANAGEMENT
• Updated Pandemic Response segment of
the Continuity of Operations Plan
• No exercises or drills conducted since
people started working in alternate
locations. Planning to start again in Fall
2022, if conditions permit
• Using online training from FEMNs
Emergency Management Institute
I
9
EMERGENCY NOTIFICATION SYSTEM
System configured and operational.
Next step is to send training messages to determine most effective
communication medium and to establish expectations regarding
employee response time.
Test only
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This Is a test of the Central San Emergency Notl lcatlon System.No action is required at this time.
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April 21, 2022 Regular Board Meeting Agenda Packet- Page 113 of 135
Page 41 of 42
WHAT IS "TOTAL COST OF RISK"?
Elements of Total Cost of Risk(rCoR)
Insurance premiums
Shp flr5[nmf mos[«ylty[r:Wcrcf r:ornpnn,•rir of Tm.il Cntir of Risk is a,swnnCp prpmiymsThy InCI,dCs nm
nmoyni n Hrm$partes«r inz,n:rrie:e e:pwr.ie3v.ind I,rpker�e:pmrnnslpr�,.
Retained losses
Tlw nasi plpmarr[k retained losses.Tlw re[nlrtee IbSs x�IW k[Irp amppnt of nwney ns�[n Ilan speedy
'out IN pvdtet'fvr Ivpses Incurted.These are cads Thal are 6elav a cvmparryrs deductible.An example Is a
small mlehap such as drycreaning a cllent's sett Za'to splins';hdn an-
Pty-Costs to protect e m p]oyeeslc ustom ers from injury
Tfly next applkablocasls may trot Was easy to track bol am still Important cumpornnts captured In the
TC.0 Cnkvlalkn,.Thr.•'v n flm cmta rrwtlud m prutrct tour eFnpho or uuclortrra from in]urMa.
Exempla=nrp safety eetni,rnrw,1.mets.—.,lrrg sljns.1—nlrrU.a[C.mes,e poxti should l,u h.•r Jrwf:rz I,:,rt of
dre TCuR for your business Inlerrwlly.
Costs to engage firms for help with risk&insurance issues
Tire next—i—ert is m spent whh profvsaioml fir—to help y handle Irtspnnce pr other risk
easo Whsti 1--.Those would Includo As for an a*omoy to r ppn0 to a complalntor to review a
comrnCt's�nlpmnlpcnv«,nUrCo .-Thorp ern nlsp part of the TCoR CnICWetlpn and am r:nn,U—1
exieenal ri�k Control Costs.
11
TCOR COMPONENTS
TCOR Categories by Fiscal Year
54,500,000
$4,000,000
$3,500,000
$3,000,000
$2,$00,000
S2,000,000 —
$1,500,000
51,000,000
Ss00,0o0
s-
ti
ryOltiti hotry� ryo��y ryo��ti ryo�y;� ti°~�~ �oy�ti �o,�ti vo��ti ryo��ti
■Personnel ■insurarl ■Claims ■RM Program ■Safety Expenses
Segments have not been adjusted for inflation.
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April 21, 2022 Regular Board Meeting Agenda Packet- Page 114 of 135
Page 42 of 42
PUTTING IT ALL TOGETHER
ICOR Totals and Trend*
$5'000'000 $4,521,113
$4,500.000
$4,000,000
$3,500,000 $2,673,249 53,361,084
$3,OOD,000
$2,500,000
$2,000,000
$1,500,000
$1.000,000
$500,000
S-
titt M1y tib til ti� tiA ti� ti~
�o� �o� ryo� ,roti° tion ,�oti`O ti�~� tion �o� tion
• All costs adjusted for inflation.
• TCOR does not include productivity loss or other soft costs arising from losses.
• Yellow bar is the highest TCOR in 10 yrs._bar is the lowest TCOR in 10 yrs.
_ I
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April 21, 2022 Regular Board Meeting Agenda Packet- Page 115 of 135