Before reporting on the very successful 2019/20 Membership Year renewal, it is worth taking a moment to memorialize the completion of an exceptional 2018/19 Membership Year. Reported Payroll and Call both reached record highs of $4.59 billion (+7.3%) and $219.5 million (+5.3%) driven by strong organic growth across all business segments. Year on year through the first 12 months, claims frequency reduced 7.0% but severity mimicked the trend of recent years and increased by 2.65%. The overall claims picture, adjusting for growth in the portfolio, reduced by 4.5%, a welcome performance and testament to the hard work of the Association’s adjusters, claims managers and safety team members.
The 2019/20 Membership Year renewal has built upon the success of the prior year, sustaining the outstanding track record of healthy payroll growth, an unparalleled Member retention ratio and 17 consecutive years of average rate reductions. In addition to running the normal renewal machinery the Signal underwriting team also implemented two significant changes at 10/1; new vendors and structure for the Mutual’s companion state act program and a revision to the coverage grant for incidental Maritime Employer’s Liability (MEL). The implementation process benefited greatly from in person renewal meetings with over 75% of the Membership (+85% by payroll). Disappointingly, four Members decided to leave the Mutual at 10/1 but the impact was offset by the acceptance of two new Members. Despite its major overhaul, there was no net change to the utilization of the companion state act program and early feedback on its performance has been positive.
The good news extended to our reinsurance program which was renewed with an increased in occurrence limit of $250 million including full coverage for nuclear, biological, chemical and radiological events which was previously limited to $100 million. Even with these improvements and an increasingly inhospitable London reinsurance market, a small exposure adjusted rate decrease was also achieved.
While, like a fine wine, the ultimate quality of a Membership Year takes many years to confirm, all signs from the 19/20 Membership Year renewal indicate an exceptional vintage. This is only possible through the hard work of many people. I want to personally extend my thanks to the Underwriting, MSR, Actuarial, Claims, Safety and Sage teams. Your work ethic and teamwork are inspiring and produced the excellent result that Members and the Association have come to expect.
We are all grateful to the Signal Mutual Membership who make this Club such a uniquely successful organization. We are looking forward to seeing you and your families at the 2020 Membership meetings. More details of the recent renewal will be provided at the upcoming General Meeting in January, and we encourage Members to take advantage of Underwriter’s Office Hours and schedule an appointment to share feedback, ask questions or even start discussing next year’s renewal.
2019/20 MY renewal statistics:
• 98.3% Member retention ratio
• $4.57 billion projected Payroll, +3.65% increase
over the 2018/19 projected Payroll
• $215 million projected Call
• 4.69% average rate, a 1.8% decrease
versus prior year
• 58% of the Membership received a
renewal rate reduction
• 10.42% preliminary Supplementary Call estimate
Thirty-five years ago in Bermuda, a few enterprising waterfront employers came together to forge a mutual to save on the cost of their workers' compensation. Signal Mutual was formed and the savings continue today with over 250 Members. All key performance indicators are at all-time highs and are projected to grow, with the principal focus on the safety of Members' employees.
At Signal, we pride ourselves in having a close personal working relationship and partnership with all our Members. We are committed to getting to know each and every one of you. At the heart of this commitment, are the two Membership meetings held in winter and summer each year. These business meetings are carefully designed and structured to give every Member an opportunity to fully understand the complete workings of their Mutual, to follow the finances, and to get acquainted with the entire Board of Directors, management team, and fellow Members.
Signal is the number one provider of Longshore workers’ compensation in the country for a reason – the strength and quality of the Membership. Signal is not an insurance company – it is a Club, your Club.
We look forward to seeing you at the next Membership meeting.
Richard W. Wood
President & CEO
January 30-February 1, 2020
The Ritz-Carlton Golf Resort
May 18-20, 2020
Hilton Norfolk The Main
ANNUAL GENERAL MEETING
August 6-8, 2020
Grand Hyatt Kauai Resort & Spa
Koloa, Kauai, HI
Signal Mutual Indemnity Association Ltd was established in January 1986 to meet the demands of the stevedoring industry for reasonable and stable workers' compensation insurance rates, and quickly became the premier Longshore mutual in the United States.
The Membership of the Association is drawn from a broad range of employers throughout the country in the stevedoring, shipbuilding/ship repair, marine construction, professional/technical and offshore industries with reported Longshore payrolls over $4.00 billion representing over 250 companies.
The business of the Association, including membership selection, underwriting, safety resources, claims management, actuarial, regulatory requirements and financial risk management is performed by the Association's Managers, Charles Taylor (Hamilton). The day to day responsibility for these operations has been delegated to Charles Taylor's affiliate, Signal Administration, with offices in Dallas Texas, Wilton Connecticut, and Long Beach California.