Annual Report 2012  
www.wcrp.info  
On the front cover: Jefferson County Courthouse  
On the back cover: Benton County Courthouse  
Page 2  
Washington Counties Risk Pool  
Created by Counties for Counties  
Annual Report 2012  
CONTENTS  
Executive Director’s Message . . . . . . . . . . . . . . . . .  
Officers’ Messages . . . . . . . . . . . . . . . . . . . . . . . . .  
Membership. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  
Governance . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  
Organization Summary. . . . . . . . . . . . . . . . . . . . . .  
SAO/DES Financial Examinations. . . . . . . . . . . . . . .  
Administrative Staff . . . . . . . . . . . . . . . . . . . . . . . .  
Liability Insurance Summary. . . . . . . . . . . . . . . . . .  
Property Insurance Summary. . . . . . . . . . . . . . . . .  
Claims Activities Summary. . . . . . . . . . . . . . . . . . .  
Member Services Activities Summary. . . . . . . . . . . .  
Loss Control Activities Summary. . . . . . . . . . . . . . .  
4
5
6
7
8-9  
10  
11  
12  
13  
14-15  
16  
17-18  
Financial Summaries. . . . . . . . . . . . . . . . . . . . . . . . 19-21  
Claims Development . . . . . . . . . . . . . . . . . . . . . . .  
Claims Summation Charts . . . . . . . . . . . . . . . . . . .  
22  
23  
Page 3  
Washington Counties Risk Pool  
From WCRP Executive Director Vyrle Hill  
To the Board of Directors and the Member Counties of the Washington Counties Risk Pool, and to  
the citizens of the state of Washington served by those Member Counties:  
The presentation of the Annual Report of the Washington Counties Risk Pool (“Pool” or “WCRP”) represents  
the culmination of the operating year; that is, except for resolving outstanding claims and lawsuits. 2011-12  
(“Py2012”) was the Pool’s 24th operating year. The Pool’s journey has included its fair share of obstacles, but  
there have been many learning experiences with pleasant rewards as well.  
Membership: The Pool’s membership grew from fifteen to nineteen during its first operating year, and then continued to  
grow over the years with eleven (county) additions, three departures and one return by Py2003 when its membership  
reached twenty eight Washington counties. WCRP’s membership remained stable until another withdrawal occurred at the  
end of Py2010. Membership has remained at the present 27 counties since October 2010.  
Joint Self-Insurance Liability Program: The Pool has provided its member counties with occurrence-based, jointly self-  
insured and/or jointly purchased 3rd-party liability coverage since October 1, 1988. Total coverage limits have grown from  
$1M during the Pool’s initial two months to $5M, then to $10M and onto $15M before reaching the $20M occurrence limit  
that has existed since 2003-04. NOTE: Optional additional occurrence limits of $5M have been available for individual  
members since 2005-06.  
Submission trends have been quite favorable – down 15% (110 claims) from Py2011, which was down 3% (25 claims) from  
Py2010. Py2012 submissions were down more than 34% (332 claims) from Py2009, which was the Pool’s ‘high-water’ mark.  
Even more significant was the mere $5.4M increase in “ground up” Incurred Loss estimates (payments made plus reserve  
estimates for open claims) during Py2012. This raised the Pool’s life-to-date Incurred Loss totals to $242.8M. The Py2012  
amount represents just 34% of the corresponding $16.0M increase in Py2011, 30% of the $17.8M in Py2010, and only 26%  
of the $20.8M annual average during Py2007 – Py2009.  
Washington Counties Property Program: Seven years ago (Py2006) the Pool began offering as a member option a fully  
insured and jointly-purchased property insurance coverage. Participation has more than doubled and total covered property  
values have nearly doubled. During Py2012, twenty six counties with covered properties totaling nearly $2.7 billion  
participated in this program. There were 13 property claims submitted in Py2012 with incurred losses-to-date totaling nearly  
$0.66M.  
Financial: The Pool’s financial position improved still further during Py2012 and continues to remain the strongest it has  
ever been. Here are a few highlights:  
Net Operating Income realized was $1.8M. This represented a 132% year-over-year increase and nearly tripled the $0.6M  
averaged annually the past ten years (Py2002-11). Contributing substantially to Py2012’s improvement was a $1.3M  
reduction by the Pool’s independent actuary in the claims reserve estimates for the WCRP-retained coverage layer ($4.3M  
from $5.6M).  
Interest Income slipped even further (-16%) in Py2012 due to lower interest rates for municipal investors and Washington  
State’s investment regulations.  
Claims Reserves for the Pool’s direct reserving exposures (in total) decreased slightly to $14.7M in Py2012, down 2.0% from  
Py2011. This represented a 23% increase from the $11.9M averaged the past ten years (Py2002-11). The Py2012 amount  
includes:  
The $4.3M noted earlier for losses in the coverage layer retained by the Pool is 23% less than the year before and just  
half of the average of the past ten years (Py2002-11);  
$9.4M for the combined aggregated stop losses from the retained layers associated with the “corridor” program for  
automobile and general liabilities, up 10% from the year before. NOTE: This program is six years old, but its liabilities  
are only beginning to mature. Its occurrence coverage maximum has been $1.0M since Py2010 following the $0.5M  
level applicable during its first three years. Its occurrence coverage minimum remains the greater of the applicable  
member county’s deductible or $0.1M.  
$1.0M for unallocated loss adjustment expenses, up 17% from one year ago and up one-third from the past ten  
years’ (Py2002-11) average.  
Total Assets grew $1.0M (2%) during Py2012 to $42.1 million. Current assets increased $1.2M (3%) while non-current  
assets decreased $0.2M (-16%). Since its low-point that existed at year-end Py2003, the Pool’s Total Assets have nearly  
quadrupled (+359%). Also, Py2003’s current assets, excluding member reassessments receivables (“retroactive  
assessments”), represented only 52% of that year’s current liabilities. Py2012’s current assets, on the other hand, totaled  
146% of the year’s current liabilities.  
(Continued on page 18)  
Page 4  
Washington Counties Risk Pool  
From Steve Bartel, PY-2012 President  
It was my distinct honor to serve as your Pool President for PY-2012. Several challenges were presented,  
and then met head on by our extremely dedicated and professional team of staff and member counties’  
representatives with positive results. The Pool continued its forward-looking focus upon the ever-changing  
insurance marketplace. We increased our loss control relationship with our reinsurers and broker and  
demonstrated a high level of integrity throughout a period of larger than normal turnover of valuable,  
knowledgeable and experienced designees from our member counties. I am very encouraged with those  
member representatives that have stepped-up their dedication and responsibility to the Pool and welcome  
all the new member appointees to “our” organization. Our future remains bright as we continue to  
recognize that the strength of the Pool has always been the excellent relationship between Pool staff and  
the membership overall. WCRP is proud of the following accomplishments over the past year:  
Steve Bartel  
Spokane  
County,  
2012  
President  
Continuing on the path of reducing the files adjudicated by the Pool’s Claims Manager so she has more opportunity  
to focus directly upon the development and training of the claims and the administration of the member counties’  
claims.  
Pool Officers, Executive Director and Producer meeting with reinsurance and excess liability insurance companies’  
representatives in Boston, New York and San Francisco that resulted in both an increased Pool responsibility with a  
quota share across all casualty coverage lines and very favorable renewal rates.  
The Pool’s net position (members’ equity) continuing to increase and resulting in an even higher underwriting  
confidence factor, compliance with current and proposed State funding requirements upon the pooling community,  
and greatly-enhanced organizational and financial versatility overall.  
Modification of the Pool’s Investment Policy and establishment of an Investment Committee to oversee the Pool’s  
investment management and increase the Pool’s investment opportunities and investment returns.  
Increasing the number of elected Pool officers to three to now include a Vice President (and President-elect) along  
with the President Secretary/Treasurer.  
Looking back, I have personal satisfaction from the true feeling of promise that we (the Pool) will continue to meet all  
challenges with the same level of focus, cooperation and commitment that has made this Pool the successful organization  
it has become. And forward looking, I am also encouraged that in passing the torch onto President Wilsdon and Vice  
President Devlin, their dedication and leadership will continue to provide the Pool and its member counties with positive,  
efficient and effective direction.  
From Mark Wilsdon, PY-2012 Secretary/Treasurer  
and PY-2013 President  
My fellow Board members, it’s been a great year and it’s been my honor to serve as your Secretary/Treasurer.  
We have endured several hurdles this PY, and I believe we have overcome them stronger than ever.  
Our investment returns are poor, many of our long time experienced members have just turned over, and we  
have faced potentially devastating policy coverage challenges as a result of the “Innocence Project”. These all  
present challenges to our financial security, decision making abilities with so many new members, and our ability  
to cover our collective exposures.  
We decided to more actively manage our investments and our respective counties’ assets for a better return  
on our citizens’ tax dollars. So far, it seems we will see a positive result. By layering our investments among  
three public entities based upon return rates dates of need requirements while staying within legally mandated  
investment constraints, we believe our returns will increase overall by several hundred percent. I would like to  
specifically mention our Executive Director and President for their Leadership in making this happen.  
It seems the “old-guard” has either retired or not been reelected. Regardless, they’re no longer employed  
with a Member County and hence a WCRP decision-maker. While the continuity issues may seem to be a  
challenge, they in fact present opportunities for us to start with fresh faces, no preconceived notions, and lots of  
Mark Wilsdon  
Clark  
County,  
Secretary/  
Treasurer 2012  
And 2013  
President  
energy to be the best pool we can be. I am excited about all the new leadership and their energy they bring to the table. Just  
because a member representative is new doesn’t mean they come without experience or capabilities.  
I am pleased we continue to endure, even during these challenging times. Our joint coverage document we all wrote  
together is still standing up; even in the face of new challenges. Cyber losses, losses that occurred before member admittance  
or the Pool’s existence, and losses that occur in the marketplace, such as Hurricane Sandy, all impact our marketability, yet we  
continue to endure and thrive because of you!  
I look forward to the upcoming year as your next President and hope that I can successfully follow such a long line of great  
past Presidents.  
Page 5  
Washington Counties Risk Pool  
Executive Committee PY2012  
(Term Ending 9/30/XXXX)  
2013  
Andrew Lampe  
Okanogan  
County  
Thru 8/22/2012  
Steve Bartel  
Spokane  
County  
Jay Winter  
Walla Walla  
County  
Bryan Perry  
Benton County  
County  
Drew Woods  
Columbia County  
County  
Marilyn Butler  
Skamania  
County  
Thru 2/29/2012  
From 7/28/2012  
From 3/23/2012  
Thru 7/27/2012  
2014  
2012  
Tammy Devlin  
Thurston  
Keith Goehner  
Lee Grose  
Lewis  
County  
Steve Clem  
Douglas  
County  
Mark Wilsdon  
Clark  
County  
Laura Merrill  
Pend Oreille  
County  
Randy Watts  
Whatcom  
County  
Chelan  
County  
County  
MEMBERSHIP PY2012  
Adams  
Benton *  
Chelan  
Clallam *  
Clark  
Columbia  
Cowlitz *  
Douglas  
Franklin *  
Garfield *  
Lewis *  
Mason *  
Okanogan  
Pacific *  
Pend Oreille  
San Juan  
Skagit  
Skamania *  
Spokane *  
Thurston *  
WCRP  
Members  
State  
% of State  
Grays Harbor * Walla Walla  
Island  
Jefferson *  
Kittitas  
Whatcom *  
Yakima  
Population  
2,829,870  
45,649  
6,817,770  
66,544  
39,337  
3,262  
N/A  
42%  
69%  
60%  
65%  
N/A  
Area (Sq. Miles)  
County Road Mileage  
# Bridges  
23,487  
* Founding Member  
2,106  
# Vehicles  
7,347  
# Worker Hours  
27,100,208  
N/A  
N/A  
Page 6  
GOVERNANCE  
WCRP Directors and Alternate Directors, Pool Year 2012  
ADAMS  
Jeffrey Stevens, Commissioner  
Linda Reimer, Clerk of the Board  
GRAYS HARBOR  
SAN JUAN  
Mike Wilson, Commissioner  
Terry Willis, Commissioner  
Dale Gowan, Director, Central Services  
Bob Jean, Interim County Administrator  
Donald “Pete” Rose, County Administrator  
Stan Matthews, Dep. Dir., Administrative Svc.  
David Kelly, Dep. Dir., Administrative Svc.  
BENTON  
Melina Wenner, HR Director/Risk Manager  
Bryan Perry, Safety/Training  
David Sparks, County Administrator  
ISLAND  
Angie Homola, Commissioner  
Elaine Marlow, Budget Director  
Betty Kemp, Director, General Services Adm.  
SKAGIT  
Jessica Neill Hoyson, HR Director/Risk Mgr.  
Billie Kadrmas, HR Director/Risk Manager  
Arne Denny, Civil Deputy PA  
CHELAN  
Keith Goehner, Commissioner  
Cathy Mulhall, County Administrator  
JEFFERSON  
Philip Morley, County Administrator  
Tim Holloran, County Administrator  
David Alvarez, Chief Civil DPA  
SKAMANIA  
Jim Richardson, Commissioner  
Marilyn Butler, Risk Manager  
CLALLAM  
Marge Upham, HR Director/Risk Manager  
Rich Sill, Code Enforcement Manager  
Michael Chapman, Commissioner  
James Jones, County Administrator  
KITTITAS  
Lisa Young, HR Manager  
Alan A. Crankovich, Commissioner  
Judy Pless, Budget & Finance Manager  
SPOKANE  
Steve Bartel, Risk Manager  
Rob Binger, Senior DPA  
CLARK  
Mark Wilsdon, Risk Manager  
Bronson Potter, Senior DPA  
LEWIS  
F. Lee Grose, Commissioner  
Paulette Young, Safety Officer/RM  
THURSTON  
Sandra Romero, Commissioner  
Tammy Devlin, Risk Manager  
Jon Tunheim, Prosecuting Attorney  
COLUMBIA  
Andrew Woods, Public Works Director  
Dwight Robanske, Commissioner  
MASON  
Tim Sheldon, Commissioner  
Steve Bloomfield, Commissioner  
Lynda Ring-Erickson, Commissioner  
WALLA WALLA  
Jesse Nolte, Deputy PA  
Jay Winter, Personnel/Risk Manager  
James K. Johnson, Commissioner  
Gregg Loney, Commissioner  
COWLITZ  
Clyde Carpenter, Risk Manager  
Claire Hauge, OFM Director  
OKANOGAN  
Andrew Lampe, Commissioner  
Nanette Kallunki, Administration Director  
Steve Bozarth, Chief Civil DPA  
DOUGLAS  
Steven Clem, Prosecuting Attorney  
Thad Duvall, Auditor  
WHATCOM  
Randall Watts, Chief Civil DPA  
Karen Goens, HR Manager  
PACIFIC  
Ken Stanton, Commissioner  
Kathy Spoor, County Administrative Officer  
Lisa Ayers, Commissioner  
David Burke, Prosecuting Attorney  
YAKIMA  
FRANKLIN  
Bob Koch, Commissioner  
Shawn Sant, Prosecuting Attorney  
Ryan Verhulp, Chief Civil DPA/Risk Manager  
Larry Peterson, Senior DPA  
James Hagarty, Prosecuting Attorney  
Terry D. Austin, Chief Civil DPA  
PEND OREILLE  
Laura Merrill, Commissioner  
Alan Botzheim, Sheriff  
GARFIELD  
Mike Lithgow, Director of Community Dev.  
Dean Burton, Commissioner  
Wynne McCabe, Commissioner  
Robert K. Johnson, Commissioner  
We would like to acknowledge the Pool’s longer-tenured board members, and thank them for the remarkable service they have provided. Listed with the counties  
from which they are appointed in parentheses are the Pool directors and alternate directors with at least…  
20 Years: Marge Upham (Clallam), Marilyn Butler (Skamania), Jay Winter (Walla Walla/WCRP/Lewis), and Betty Kemp (Island);  
15 Years: Melina Wenner (Benton), Claire Hauge (Cowlitz), Randy Watts (Whatcom), and Dean Burton (Garfield);  
10 Years: Clyde Carpenter (Cowlitz), Tammy Devlin (Thurston/Lewis), and Linda Reimer (Adams);  
5 Years: Keith Goehner and Cathy Mulhall (Chelan), Steve Clem and Thad Duvall (Douglas), Billie Kadrmas (Skagit), Rob Binger and Steve Bartel (Spokane),  
Larry Peterson (Yakima), Andrew Woods (Columbia), David Alvarez (Jefferson), Bronson Potter and Mark Wilsdon (Clark), Andrew Lampe (Okanogan), Lee Grose  
(Lewis), and Pete Rose (San Juan).  
Unfortunately, farewells were conveyed to some of the longer-tenured board members as they departed their respective counties. Our sincere thanks as well as  
good wishes are extended to:  
Marilyn Butler (retired August 2012) – supported the WCRP Board for 24 years (1988 – 2012) as a director or alternate director from Skamania County. During  
her long WCRP tenure, Marilyn was elected to multiple terms (8.8 years) on its Executive Committee. She presided over the Pool as Py2011 President following a  
term as Secretary-Treasurer (Py2010). She also co-chaired the Pool’s Underwriting Committee for many years.  
Jay Winter (retired February 2012) – supported the WCRP Board for 21 years (1991 – 2012) as a director from Walla Walla County, a Pool staffer, and a director  
from Lewis County. During his long WCRP tenure, Jay was elected to multiple terms (5.4 years) on the Executive Committee. He presided over the Pool as  
Py2010 President following a term as Secretary-Treasurer (Py2009). He also served on all of the Pool’s Standing Committees, chairing several of them.  
Betty Kemp (retired June 2012) – supported the WCRP Board for 20 years (1992 – 2012) as an alternate director from Island County. Betty also served on the  
Pool’s Risk Management Committee.  
Billie Kadrmas (retired February 2012) – supported the WCRP Board for more than 8 years (2004 – 2012) as a director from Skagit County. She co-chaired the  
Pool’s Personnel Committee.  
Donald “Pete” Rose (resigned June 2012) – supported the WCRP Board for 5 years (2007 – 2012) as a director from San Juan County.  
Page 7  
Washington Counties Risk Pool  
Organization Summary 2012  
Washington Counties Risk Pool (“Pool” or “WCRP”) was formed August 18, 1988, via Interlocal  
Agreement signed initially by 15 of Washington’s 39 counties. Thirteen of the original members  
began utilizing the WCRP insuring program and services that October, while the other two and  
another four that joined the Pool later that first year began receiving coverage as their  
commercial insurance programs expired. Over its first quarter century of operation, the Pool has  
continued to grow and now serves 27 counties.  
The WCRP was established to provide its member counties with “joint” programs and services  
including self-insurance, purchasing of insurance, and contracting for or hiring of personnel to  
provide administrative, claims handling and risk management services. The WCRP operates  
under Washington’s “pooling” laws, specifically RCW Chapter 48.62 and WAC 200-100, and is  
overseen by the State Risk Manager with fiscal and accountability audits performed annually by  
the State Auditor.  
The WCRP mission:  
to provide comprehensive and economical risk coverage;  
to reduce the frequency and severity of losses; and  
to decrease costs incurred in the managing and litigation of claims.  
The Pool’s core values include:  
being committed to learn, understand and respond to member insurance needs;  
establishing working relationships with all members who identify business  
issues and jointly developing solutions; and  
allocating resources to risk management in their own member county  
operations.  
The Pool’s Board of Directors and staff share a commitment to manage the organization based  
on sound business principles, benchmarked industry standards and measurable outcomes;  
and to continuous planning and innovation in product development and service delivery.  
The enabling Interlocal Agreement was enhanced in 2000 with the addition of the Pool’s  
Membership Compact, a commitment to strengthen the Pool by helping its member counties  
implement local Risk Management Programs to reduce losses and support the best  
management of the WCRP and its resources. The Compact established obligations to support  
these goals through three major elements: membership involvement, risk control practices, and  
a targeted risk management program.  
Joint Self-Insurance Liability Program: WCRP members presently acquire $20 million (with a  
county-by-county option to $25 million) of joint liability coverage on a “per occurrence” basis for  
third-party bodily injury, personal injury, property damage, errors and omissions, and advertising  
injury. Members annually select an “occurrence deductible” of $10,000, $25,000, $50,000,  
$100,000, $250,000, or $500,000. The initial $10 million of coverage is jointly self-insured;  
(Continued on page 9)  
Page 8  
(Continued from page 8)  
however, reinsurance is acquired to protect the Pool directly and its members indirectly from large  
losses. The remaining insurance, up to $15 million, is acquired as “following form” excess  
insurance. There are no aggregate limits to the claims payments for any one member county or  
all member counties combined.  
Property Program and Other Coverages: Beginning with the 2005-06 policy year, the WCRP  
added fully-insured property coverage with limits of $500 million (normal) and $200 million  
(catastrophic) as a member county option. Twenty-six counties presently purchase this  
coverage. Some members also use the Pool’s contracted insurance producer to secure  
insurance products, e.g. special events and concessionaires, environmental hazards, public  
official surety bonds, and airport, ferry and railroad operations coverages.  
The WCRP is governed by a Board of Directors consisting of one Director (and at least one  
Alternate Director) designated by each member county. The Pool’s Board, comprised of both  
elected and appointed county officials, meets three times a year with its Annual Meeting in the  
summer. The Board is responsible for determining the liability coverage being offered  
(approving the insuring agreement or coverage form), the reinsurance to purchase, the excess  
insurance(s) to be jointly purchased or offered for purchase, and for approving the Pool’s  
annual operating budget, its work programs and the member-assessment formulae.  
Regular oversight of the Pool is furnished by an 11-person Executive Committee, members of  
which are elected by the Pool Board from its membership to staggered three-year terms. The  
present make-up includes an average of 8.5 years experience working with the Pool. The  
Executive Committee meets several times throughout the year to approve all WCRP  
disbursements and examine the Pool’s financial health; to approve case settlements that  
exceed member deductibles by at least $50,000, and to review resolution strategies for all  
claims with incurred loss estimates exceeding $100,000. The Committee also evaluates the  
Executive Director and the Pool’s operations and program deliverables. Committee members  
also participate in the Board’s standing committees (Finance, Personnel, Risk Management  
and Underwriting) for development or review/revision of the organization’s policies and  
coverage documents.  
Six of the Pool’s ten-person staff handle and/or manage the several hundred liability cases  
submitted yearly. These claims professionals have nearly 100 years of combined claims  
handling experience. With the recently added resources, the “open” file count is declining,  
having been reduced to under 400. Other staff are responsible for supporting Pool  
administrative needs and providing member services that include assessments of risks,  
training, compliance auditing, coverage development and marketing.  
Other professionals from some of the most respected organizations worldwide are called upon  
regularly to address specific needs of the Pool: PricewaterhouseCoopers, LLP, furnishes  
independent actuarial services; Strategic Claims Direction, LLC, furnishes independent claims  
auditing services; Arthur J. Gallagher Risk Management Services, Inc., provides insurance  
producer (broker) and advanced loss control services. Also, claims audits are occasionally  
performed by the Pool’s insurers and reinsurers. These professionals are in addition to the  
many assigned defense counsel and the “pooling” oversight by the State Risk Manager and  
audits performed by the State Auditor’s office.  
Page 9  
FINANCIAL EXAMINATION AND REPORTS FROM THE STATE AUDITOR  
The State Auditor’s Office independently serves the citizens of Washington by  
promoting accountability, fiscal integrity and openness in state and local  
government. Working with governments and citizens, it strives to ensure the  
efficient and effective use of public resources. According to RCW 43.09.260, “The  
examination of the financial affairs of all local governments shall be made at such  
reasonable, periodic intervals as the state auditor shall determine. ...an  
examination of ...local government self insurance programs shall be made at least  
once every two years. On every such examination, inquiry shall be made as to the financial condition  
and resources of the local government; whether the Constitutions and laws of the state, the  
ordinances and orders of the local government, and the requirements of the state auditor have been  
properly complied with; and into the methods and accuracy of the accounts and reports.  
The most recently published audit reports are available for viewing at:  
http://www.sao.wa.gov/EN/Audits/Pages/Search/AuditReportSearch.aspx  
(In the left-side box labeled “Government Type,” select Insurance Pool/Risk Management  
before selecting Washington Counties Risk Pool from the right-side box.  
Select from the listed reports.)  
OR… you can find them on the WCRP website at: www.wcrp.info/reports.html  
LOCAL GOVERNMENT SELF INSURANCE PROGRAM EXAMINATION  
The Department of Enterprise Services, through the Risk Management Division, Administers the Local  
Government Self-Insurance Program (LGSI). The program provides approval and oversight of joint self-  
insured local government property/liability programs and individual or joint self-insured local  
government employee health/welfare (medical) benefit programs as provided in Chapter 48.62 RCW  
and WAC 200-100.  
The mission of LGSI is to protect taxpayer resources by ensuring that local government self-insurers are  
informed about the program's financial condition, participate in decisions which affect insurance services  
for entities they represent, and ensure compliance with laws and regulations designed to foster  
financially sound management practices.  
The most recently published examination reports are available for viewing at:  
http://www.ofm.wa.gov/rmd/lgsi/poolrpts.asp  
Page 10  
Washington Counties Risk Pool  
OPERATIONAL STAFF  
ADMINISTRATION  
MEMBER SERVICES DIVISION  
LOSS CONTROL  
COORDINATOR  
Jill Lowe  
ACCOUNTING  
OFFICER  
Sue Colbo  
EXECUTIVE  
DIRECTOR  
Vyrle Hill  
ADMIN  
ASSISTANT  
Stacey Spears  
SPECIALTY  
SERVICES  
David Goldsmith  
CLAIMS DIVISION  
SR. CLAIMS  
ANALYST  
Mike Cook  
MANAGER  
Susan Looker  
SR. CLAIMS  
ANALYST  
Candy Drews  
CLAIMS  
REPRESENTATIVE  
Lisa McMeekin  
CLAIMS  
ANALYST  
Tammy Cahill  
CLAIMS  
ASSISTANT  
Carli Easter  
PROFESSIONAL SUPPORT  
WCRP is backed by professionals with some of the best organizations worldwide:  
PricewaterhouseCoopers LLP, for independent actuarial services  
Kevin Wick, FCAS, MAAA  
Craig Scukas, FCAS, MAAA  
Strategic Claims Direction, for independent claims auditing services  
Gary Jennings, Principal  
Arthur J Gallagher Risk Management Services, Inc., for insurance producer (broker)  
and advanced loss control services  
Mike Croke, ARM, Senior Vice President, Elizabeth Miser, Area Vice President & Darin Puryear, Area President  
Julie McCallum, Vice President, Risk Management Services & Tim Chace, Director of Risk Control  
DES Local Government Self Insurance Program - State of Washington  
Shannon Stuber, Program Administrator  
Auditor - State of Washington  
Hon. Brian Sonntag  
Page 11  
Washington Counties Risk Pool  
SUMMARY OF 2011-12 LIABILITY INSURANCE PROGRAM  
The Washington Counties Risk Pool provides its member counties with tort liability limits of $20-$25  
million per occurrence. Subject to member-selected deductibles, this includes $10 million in joint (self  
-insured) financial protection plus $10-$15 million in "following form" excess coverage. Member  
counties select their occurrence deductibles each policy year from either $10,000, $25,000, $50,000,  
$100,000, $250,000 or $500,000 options. There are no annual aggregate limits to the payments the  
Pool might make for any one member county or all member counties combined.  
The coverage form for the Pool's joint self-insurance liability policy covers bodily injury, personal  
injury, property damage, errors and omissions, and advertising injury.  
$20 million  
$10 million  
JOINTLY PURCHASED ("following form" Excess Policy)  
$2 million  
$1 million  
JOINTLY FUNDED  
REINSURANCE PROGRAM  
$500,000  
(Loss Fund)  
$250,000  
$100,000  
$50,000  
"RISK SHARED"  
$25,000  
OCCURRENCE DEDUCTIBLES  
(Reimbursed by Member Counties)  
$10,000  
Page 12  
Washington Counties Risk Pool  
SUMMARY OF 2011-12 PROPERTY INSURANCE PROGRAM  
Participating Counties  
Adams  
Benton  
Chelan  
PROPERTY -  
“All Covered Perils”  
Commercial Insurers  
Clallam  
Clark  
Limit of Liability - $500 million  
Commercial Insurers  
Earthquake & Flood  
$200 million  
Columbia  
Cowlitz  
Douglas  
Franklin  
Garfield  
Grays Harbor  
Island  
Deductibles - vary by county  
Program Limits  
Total Insured Values  
Composite schedules total $2.6 billion.  
Jefferson  
Kittitas  
Covered Perils Include: Real and personal property, business  
interruption, extra expense rental value, demolition and increased  
cost of construction, valuable papers, accounts receivable, transit,  
EDP (Equipment/Media/Extra Expense), newly acquired property,  
course of construction, contractors equipment, errors and  
omissions, offsite storage and personal property of the insured’s  
officers and employees while on the premises of the insured.  
Lewis  
Mason  
Okanogan  
Pacific  
Pend Oreille  
San Juan  
Skagit  
Limits of Liability  
$500,000,000 - All covered Perils, excluding EQ & FL  
$200,000,000 - Earthquake & Flood with:  
$25,000,000 Special Flood Hazard Areas  
Skamania  
Spokane  
Thurston  
Walla Walla  
Whatcom  
Deductibles  
All Covered Perils: $5,000 to $50,000 (county option). Earthquake  
and Flood deductibles vary with specific circumstances.  
Page 13  
Washington Counties Risk Pool  
From Claims Manager Susan Looker, AIC  
As counties go about their day to day business, third party liability claims are inevitable. There are multiple  
offices/departments that make up county government. Continued budget cuts mean officials and employees now  
do more with less. In the automobile liability (AL) area, there are many county drivers including public works  
employees and sheriff deputies. In the general liability (GL) area, there are miles of county roads to design and  
maintain, permits regarding land use that are issued, jails that are operated, and executive decisions that are  
made. In the employment liability (EL) area, there are unions, contracts and both line and management  
employees, as well as elected officials to consider.  
When claims are reported to WCRP, it is the responsibility of the claims staff to timely review each claim,  
determine coverage, investigate allegations, set appropriate reserves, report to proper authorities, and resolve  
the claims in a fair and cost effective manner. Performing these functions during Py 2012 was a dedicated staff  
of six. Mike Cook (Senior Claims Analyst) began his career in insurance in 1982; Candy Drews (Senior Claims  
Analyst) in 1998; Tammy Cahill (Claims Representative) in 1987; Lisa McMeekin (Claims Representative) in 2008;  
and Carli Easter (Claims Assistant) in 2012. Combined with me (1989), there were more than 90 years of claims/  
insurance experience addressing the WCRP member counties claims.  
634 claims (and lawsuits) were added to the Pool’s claims database during Py2012. This raised the to-date total  
(Oct 1988—Sep 2012) of third-party liability claims submitted by WCRP member counties to 18,616. The Pool  
paid $13.8 million in indemnity and expenses during Py2012. With 18,241 of the claims designated as closed,  
only 375 claims remained classified as open at year’s end. There were four open claims preceding Py2004 at the  
end of Py2012. The Pool’s independent actuary estimates another 332 claims could be filed for covered  
occurrences from all WCRP years through September 2012. That would bring the estimated ultimate claims total  
to 18,948.  
93 of the 716 claims open during Py2012 were valued at approximately $38.15 million. Four cases went to trial  
with all four resulting in defense verdicts. Nine open cases were valued over $1 million; the collective value of  
these cases was $14.2 million. Of those nine cases, seven involve joint and several liability potentials.  
Even though nearly 40% of claims are resolved without any payments, more than $205.1 million have been paid  
addressing the Pool’s claims to-date. 40% of the amounts paid ($81.2 million) are deductibles reimbursed by the  
applicable member counties. 3% ($6.8 million) was covered under excess insurance policies and reimbursed by  
the applicable commercial insurers. The remaining 57% ($117.1 million) represents the “risk shared” portion of  
the joint self-insurance coverage paid from “pooled” funds—$54.6 million retained by the Pool itself and $62.5  
million reimbursed by its commercial reinsurers.  
Open Events as of 9/30/12  
CASE DISTRIBUTION (Severity)  
Pool Year  
A-N (88-02)  
O (02-03)  
P (03-04)  
Q (04-05)  
R (05-06)  
S (06-07)  
T (07-08)  
U (08-09)  
V (09-10)  
W (10-11)  
X (11-12)  
Total Open  
Open Claims  
3
1
Value Range (between)  
Count  
7,405  
8,862  
605  
585  
415  
305  
237  
114  
55  
Percentage  
39.78%  
47.60%  
3.25%  
3.14%  
2.23%  
1.64%  
1.27%  
.61%  
$0  
$.01  
$5,000  
$10,000  
$25,000  
$50,000  
$100,000  
$250,000  
$500,000  
$1,000,000  
$0  
$5,000  
2
8
$10,000  
$25,000  
$50,000  
$100,000  
$250,000  
$500,000  
$1,000,000  
Over  
9
12  
23  
51  
59  
56  
151  
375  
.30%  
.18%  
33  
Page 14  
Total # Events  
(Frequency)  
Incurred Loss Estimates  
(Severity)  
by Claim Type  
by Claim Type  
PTD through 9/30/2012  
PTD through 9/30/2012  
AL  
12%  
EL  
AL  
24%  
EL  
2%  
18%  
GL  
GL  
70%  
74%  
ALLOCATION OF INCURRED LOSSES by Claim Status, PTD through 9/30/12  
Status  
Incurred  
$ 36,700,071  
7,699,121  
Counties  
$ 16,860,000  
4,289,621  
WCRP SIR  
$ 2,265,071  
1,014,500  
Corridor  
$ 6,170,000  
1,395,000  
2,822,293  
170,548  
Total SIR  
$ 25,295,071  
6,699,121  
Insurers  
$ 11,405,000  
1,000,000  
Open Legal  
Open Claims  
Closed Legal  
Closed Claims  
165,474,913  
32,900,569  
53,973,122  
22,808,701  
43,334,982  
6,629,319  
100,130,397  
29,608,569  
65,344,515  
3,292,000  
TOTAL  
$ 242,774,674  
$ 97,931,444  
$ 53,243,872  
$ 10,557,841 $ 161,733,158  
$ 81,041,515  
Page 15  
Washington Counties Risk Pool  
From David Goldsmith, Member Specialty Services  
Specialty Member Services  
Member Services include both loss control and special membership support activities. These include activities that are  
intended to further the development of the Pool overall and the insuring products and services provided to/for its  
member counties, as well as to assist its member counties with administering their risk management/self-insurance  
programs. Strategic planning, membership communications including orientation/development of members’ Pool  
appointees, marketing (internal and external), and review/enhancement of the Pool’s insuring products and services  
are some examples of specialty member services.  
New Pool Directors’ Orientation  
A feature added to the Pool’s annual spring conference a few years ago is an orientation for WCRP (Board of) Directors  
and Alternate Directors that have been appointed recently by their member counties’ legislative authorities. The 2012  
orientation included a review of the history and operations of the Pool and provided an introduction into how the  
pooling community conducts business differently from the commercial insurance, both in terms of structure and in  
operating philosophy. Attendees were also provided the Pool’s financial statements and a briefing about ‘how to read  
and interpret’ them. Special emphasis was given to the factors being used by the State’s oversight agents and the Pool  
itself which indicate the Pool’s health and that of the pooling community in general.  
Member Counties Visitations  
A cornerstone to the Pool’s success is its open communication with member counties’ elected and appointed  
leaderships. To this end, Executive Director Vyrle Hill and Member Services’ David Goldsmith met in and with each of  
the WCRP member counties over the course of the spring and summer. The focuses of these discussions were the  
Pool’s mission and the insuring programs it offers, its governing and organizational structures, an overview of casualty  
claims loss information and the Pool’s financial/operational health, and the claims management and loss control/  
educational program support provided by the Pool for/to its membership.  
Marketing/Partnerships  
Marketing visitations expressing the advantages of membership in the WCRP as a member-driven service organization  
were conducted with four non-member counties. Additionally, the Pool was represented at the Washington State  
Association of Counties (WSAC) and the Washington Association of County Officials (WACO) conferences to maintain  
presence as both a casualty and property insuring resource and an administrative partner to Washington’s counties. Of  
specific note was a review by Whitman County conducted during the year of its insuring program(s) and comparing  
that against what the Pool offers. While Whitman County did not decide to change and join the WCRP, the Pool will  
continue to assist non-member counties with analyzing their present insuring program(s) and comparing those to the  
Pool’s.  
Property Inventory Management System (PIMS)  
An electronic property inventory management system (PIMS) was designed and developed by the Pool several years  
ago to support its Washington Counties Property Program (WCPP) and assist the WCPP participants with maintaining  
their insured properties schedules and presenting the same to the WCPP underwriter(s). PIMS continues to be  
upgraded in an effort to make the system more ‘user friendly’ and more closely align the schedules with the WCPP  
underwriting needs. Newer underwriting standards have come into play as the insuring industry attempts to further  
refine rating projections for catastrophe coverage. The recent adjustment to PIMS is an attempt to correlate these  
properties inventories with that refined criteria to derive the best pricing available to WCPP participants for this unique  
property insurance program.  
Membership Satisfaction Survey  
Every other year the Washington Counties Risk Pool surveys its member counties’ appointees to assess the levels of  
satisfaction with various aspects of the Pool’s operations. Using a 1 to 5 scale, 1 representing the lowest/unacceptable  
rating and 5 being the highest/exceptional, the overall score for satisfaction with the Pool and the services it is  
providing at the conclusion of Py 2012 was 4.63. That is the highest overall rating shared since the Pool began  
conducting this biennial survey.  
Page 16  
Washington Counties Risk Pool  
From Loss Control Coordinator Jill Lowe  
Loss Control works closely with the Claims department and the Board of Directors Risk Management Committee to  
develop training, conduct site visits and offer loss control expertise that will positively impact Pool losses. Decreasing  
losses isn’t easy. We are effective though. We work with members to integrate innovative practices. We offer cutting  
edge workshops with presenters who challenge as well as educate workshop attendees. By gathering and utilizing the  
wisdom of and within member counties, we work to ensure positive loss control change.  
Loss Control Workshops offered in Pool Year 2012:  
Employment Law Related Claims – Risk Pool claims are relatively consistent with claims experienced by public  
entities throughout the United States. Employment law related claims, while relatively few in number, account for the  
highest average per claim cost. The ability to conduct critical conversations directly influences whether employment  
issues are effectively addressed. During this pool year, “Conducting Difficult Conversations” workshops were  
enthusiastically received, filling all available seats in nine locations throughout the state.  
Conducting Effective Performance Evaluations Training – Performance evaluations are critical for identifying  
and coaching employees that have performance and conduct issues. This class was offered in four locations  
throughout the state, in addition to the 12 classes offered last year.  
Management & Supervisory Training – WCRP’s instructors guide supervisory staffers through a curriculum  
addressing a myriad of current issues, and how to constructively hone their skills in areas including establishing/  
maintaining a leadership atmosphere, managing a diverse workforce, conducting pre-employment inquiries and  
employee performance reviews, and avoiding/responding to claims of harassment, bullying and discrimination,  
along with a review of employment-related liability legal cases. One Management & Supervisory Training  
workshop was offered this Pool year.  
Other Loss Control Programs  
Permit Error - The Pool offered its first webinar this Pool year. Permit error allegations occur on a frequency that  
requires refresher training. A one hour webinar with over 150 attendees was presented by an attorney who  
specializes in land use cases.  
Risk Manager, Claims Administrator, Board Members – The Pool Board meets three times a year to discuss  
Pool business and receive training. “Mentally Ill in Jails”, “Tort Reform”, “Employment Investigations” and  
“Contracts and Your Joint Self-Insurance Coverage” were topics presented for conference attendees.  
Law Enforcement/Corrections – Sixteen member county law enforcement agencies participate in the Lexipol Daily  
Training bulletin program. Law enforcement deputies receive daily training in low frequency and high severity  
issues. A Seattle law attorney specializing in law enforcement and corrections wrote papers addressing  
allegations relating to Negligent Supervision, Negligent Handling, Excessive Force, Civil Rights and False Arrest.  
The papers are being used by members as educational training tools.  
Membership Compact –WCRP’s Membership Compact, an agreement amongst and between the member counties,  
outlines educational courses required for each member’s designated risk management and claims administration  
personnel, which includes bot introductory and advanced-level courses offered through the American Institute for  
Chartered Property Casualty Underwriters/Insurance Institute of America. Study reviews and exams are offered  
by WCRP several times a year. All 27 County Risk Managers are currently in compliance with certification  
requirements.  
Scholarships/Train-the-Trainer/Sponsorships – Funds have been approved yearly to help provide extensive,  
highly specialized and/or instructor-level risk management-related training that WCRP is unable to provide  
directly. County employees apply for scholarship funds with approval from the respective county’s designated risk  
manager. The Pool also supports special training requests from/and/or in conjunction with its member counties  
including human resource professionals and elected officials who attended the Association of Washington Cities  
Labor Relations Institute.  
New County Public Officials Training Program (formerly Certified Public Officials) – WCRP is one of the  
sponsoring agencies offering “core” and “elective” courses in county/public entity operations and management for  
(Continued on page 18)  
Page 17  
(Continued from page 17 - Loss Control Report)  
county officials and personnel in Washington State. The program helps familiarize and acquaint elected and  
appointed officials and county staffers with the responsibilities and potential liabilities related to serving in public  
office. Through the County Training Institute, the risk pool offers an on-line Risk Management course.  
Member Roundtables – Usually scheduled with the thrice-yearly Board Meetings, WCRP staff with assistance from  
the Pool’s Risk Management and Underwriting committees, host legal liability trainings and facilitate roundtable  
discussions. In an informal setting, county Risk Managers and Claims Administrators share successes, concerns  
and various risk-related issues, and learn of new trends in the insurance industry. CLE credits are often earned by  
attorneys who are present.  
Model Policies/Reference Library – WCRP’s website features an extensive up-to-date electronic library of model  
policies and procedures covering the broad range of issues its counties offer. Why reinvent the wheel when  
someone before us has already put in that time and effort? If the subject you need isn’t there, just let us know  
and we’ll find it.  
Coming in Pool Year 2013:  
Employment Law – Employment law related claims and lawsuits can often be avoided by addressing  
uncomfortable issues quickly and directly. WCRP will offer 8 workshops on Staying Out of Court on Employment  
Claims. This employment law class will focus on the ten most prevalent employment-related claims that counties  
face. The class will include information on how to avoided lawsuits through knowledge and understanding of the  
law, implementing and following proper policies, and dealing with employee issues as they arise, legally and  
factually.  
Law Enforcement/Corrections – WCRP will continue to contract with Lexipol to provide law enforcement officers  
Daily Training Bulletins (DTB’s). DTB’s are accessed each day via computer and take approximately 5 minutes to  
complete. The subject matter is geared toward Washington State Law. The passing of each test offered at the  
end of the daily bulletin and the subject matter is documented. For most counties during this time of recession,  
especially the smaller ones, the training requirement has become onerous due to cuts to budgets and staff  
coverage limitations. If all member counties signed up for the Daily Training Bulletins, nearly 1200 law  
enforcement officers in Washington State would be receiving daily training in high risk subjects. In addition,  
WCRP is conducting a test program for Lexipol’s newly released Custody Manual. Twelve county corrections  
departments are participating in the this program.  
(Continued from page 4 - Executive Director’s Report)  
Net Position (also referred to as “Net Assets” or “Members’ Equity”) increased $1.8 million (+17%) to $12.9M as of  
September 30, 2012. Net Position has increased steadily more than $14.6M from the negative $1.75M that existed at  
year  
end Py2003 and that earlier year was aided by $2.9M in member reassessments receivables. Of the Py2012 total,  
$4.8M is classified “Restricted” — $0.8M to satisfy the State’s solvency provisions (WAC 82.60.03001) plus $4.0M  
to address the Pool’s own Underwriting Policy requirements; and  
$1.0M held in Capital Assets (net of debt); leaving  
$7.1M classified as “Non-Restricted” and available for use per the directives of the Pool’s Board of Directors.  
Confidence Factor, which is determined annually by the independent actuary and typically referred to as the actuarial  
confidence level, remains the more recognized measure of a pooling entity’s financial well-being, at least for now. The  
WCRP actuarial confidence level has grown steadily the past several years and far exceeds the 98% goal set by the  
Board of Directors after all the reassessments were satisfied in early 2007.  
More challenges remain ahead, that we do know. But the Pool’s 24 year journey has provided those involved in this  
“pooling” concept the opportunity to mature – from the innocence of infancy to the awareness and wisdom customary  
of adulthood. The Pool continues on, yet now with even greater optimism! Its qualities and the insuring options  
available for its member counties combined with its strong financial position should serve to convince more  
Washington counties to “join the ranks” and become WCRP members over the course of time. I am most pleased to  
have been associated with this very unique public service organization since its establishment many years ago and  
proud to have been its Executive Director since 2005.  
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