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Renewal of Excess Workers’ Compensation Insurance for RTA Employees [2025-2027]
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DESCRIPTION: Renewal of Excess Workers’ Compensation Insurance Coverage for RTA Employees [2025-2027] |
AGENDA NO: Click or tap here to enter text. |
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ACTION REQUEST: ☒ Approval ☐ Review Comment ☐ Information Only ☐ Other |
RECOMMENDATION:
recommendation
Authorize the Chief Executive Officer to proceed with renewal of Excess Workers’ Compensation insurance coverage for all RTA employees for the policy period of 12/20/2025-12/20/2027 at a total cost of $635,234.00.
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ISSUE/BACKGROUND:
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Under Louisiana law, every employer is required to carry workers’ compensation insurance or must be approved for self-insurance. All employees, full- or part-time, must be covered. Until 2020, RTA employees, all classified as administrative, were covered under a first-dollar workers’ compensation program through LWCC, the Louisiana Workers’ Compensation Corporation, with a corresponding minimal cost in premium. However, with the transition of Transdev employees to the RTA in late 2020, the bulk of whom were operational, the cost of such a program with LWCC became prohibitive. As such, in December 2020, RTA moved to a self- insurance program managed by a third-party administrator, with excess workers’ compensation insurance in place for only the most severe or catastrophic claims.
With Board approval, this coverage was initially placed with Safety National Casualty Company for policy period 2020-2021, and again, for policy period 2021-2022. For policy periods 2022-2023, and 2023-2025, respectively, the Board approved Midwest Employers Casualty Company for optimal coverage.
Request for approval is sought today for renewal of this excess workers’ compensation insurance coverage with incumbent Midwest Employers Casualty Company, to cover another two-year term extending from 2025-2027. This is a highly competitive two-year quote, which the RTA insurance broker of record, Relation Insurance Services, Inc., has strongly recommended.
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DISCUSSION:
In seeking renewal coverage, Relation Insurance Services, Inc., only received two quotes from Midwest. Although the RTA insurance broker of record approached all potential Excess Workers’ Compensation carriers writing in Louisiana, the three other carriers in the market declined to quote based upon either their current evaluation of the risk or a change in their operations.
Specifically, Midwest Employers Casualty Company, the incumbent, is quoting for both a one-year and two-year term, with a Self-Insured Retention [“SIR”] of $1,000,000 and limit of $1,000,000 commensurate with RTA’s risk and exposure. Midwest Employers is quoting an annual premium of $317,617.00, with the option of a two-year quote of $635,234.00 [$317,617.00 for 2025-2026; $317,617.00 for 2026-2027] with no increase in the premium cost for year two [2026-2027] of coverage. Given the current insurance market, it is highly advisable that RTA secure this quote and elect this two-year option.
The significant increase of 39% in premiums from the prior two-year term is primarily due to a 25% increase in RTA payroll from CY 2023 to CY 2025. Other reasons for the increase include a limited workers’ compensation market, increases in accident severity throughout the industry yielding higher indemnity and medical costs, and medical inflation.
Therefore, staff and broker hereby recommend selection of Midwest Employers Casualty Company for renewal of RTA excess workers’ compensation coverage for a two-year term [2025-2027] for optimal cost savings.
FINANCIAL IMPACT:
$635,234.00
Funds for this contract are available from the RTA operational budget [Account # 01-8300-02-9135-169-89-00-00000-00000] for year one [2025-2026] and will be available from the operational budget for year two [2026-2027].
NEXT STEPS:
Proceed with this renewal of excess workers’ compensation insurance coverage with Midwest Employers Casualty Company.
ATTACHMENTS:
1. Resolution for Renewal of Workers’ Compensation Insurance for RTA Employees [2025-2027]
2. Excess Workers’ Compensation Insurance Options: Midwest Employers Casualty Company
Prepared By: Marc Popkin
Title: Risk Management Counsel
Reviewed By: Tracy Tyler
Title: Chief Legal Officer
Reviewed By: Gizelle Banks
Title: Chief Financial Officer
12/5/2025
Lona Edwards Hankins Date
Chief Executive Officer