The City of Claremore saved close to $1.1 million in workers’ compensation in two and a half years.
In 2016, the city eliminated Oklahoma Municipal Assurance Group (OMAG) workers’ compensation coverage and replaced it with coverage through Wilcox & McGrath Insurance, allowing the city to be partially self-insured, to reduce costs.
“Overall it is doing what we thought it would do,” said Mayor Bill Flanagan.
The City of Claremore allocates $636,000 a year for workers’ compensation.
From that allocation, the city pays Wilcox & McGrath roughly $150,000 a year in premiums and annual fees.
In FY 16/17, the city expended $154,535 and processed $213,623 in claims for a total workers $368,158 for a total savings of $267,842.
Costs declined in FY 17/18, with $165,678 in expenses, claims $83,480 for a total of $249,158 for a total savings of $387,442.
This year to date, FY 18/19, the city has paid $142,216 and claims $25,812, for a total $168,027. Total savings thus far has been $468,573.
“It’s important to note we are only halfway through the year,” said Claremore HR Director Ashley Hickman. “There are a few open claims out there.”
“That is not free money to got to projects,” Hickman said. “You can’t spend it. It has to be designated for workers’ comp.”
Savings will be kept to cover the deductibles and expenses on any future catastrophic events.
Flanagan said that after five or ten years of savings were accrued, additional savings can be used for roads, bridges and equipment for police and fire.
“That will be spendable money in the future, but it takes a few more years of building that reserve so that when we do have a big event we have enough cash to cover it,” Flanagan said.