FUND YEAR 2018 ADMINISTRATOR QUARTERLY REPORT TO THE BOARD OF DIRECTORS [Quarter Ending 3/31/18] June 20, 2018 Administrator 123 Interstate Drive West Springfield, Massachusetts 01089 Toll Free: (855) 874-0123 Fax: (413) 739-9330 The following is prepared for the sole use and information of the Directors, Committee Members, advisors, and consultants of Independent Schools Compensation Corporation. in that it contains information specific to the Members of the Group, it is considered CONFIDENTIAL. Table of Contents MEETING AGENDA………………………………………………………………………………………… 3-4 MINUTES – MARCH 8, 2018…….……………………………………………………………..….. 5-8 INTRODUCTION COMMENTARY………………………………………………………………….. 9-11 LEGISLATIVE UPDATE …………………………………………………………………………………. 12-14 MEMBERSHIP AND MARKETING ………………………………………………………………… 15-21 FINANCIALS ……………………………………………………………………………………………….. 22 • Consolidated Financials……………………………………………………………………… 23-24 • Class A Financials….……………………………………………………………………………. 25-31 • Class B Financials……….……………………………………………………………………….. 32-35 INVESTMENTS ……………………………………………………………………………………………. 36 • OPUS Investment Management – Quarterly Summary……………………….. 37-54 CLAIMS AND LOSS CONTROL………………………………………………………………………. 55 • Claims & Loss Control Meeting Agenda …………………………………………….. 56 • Minutes – March 8, 2018 ………………………………………………………………….. 57-59 • Annual Safety Day Debrief ………………………………………………………………… 60-67 • Claims Overview and Charts by Class..……………………………………………….. 68-71 • Large Claim Review…………………………………………………………………………….. 72-77 • Settlement Requests………………………………………………………………………….. 78-81 • Lump Sum Settlements, Medical Case Management Quarterly Expenses, and Recoveries…………………………………………………………………… 82 • Loss Control Summary………………………………………………………………………… 83-86 • Health & Safety Grant Program …………………………………………………………. 87-88 ADMINISTRATORS’ REPORT ……………………………………………………………….………. 89 • 2018 Workers’ Compensation Rate Comparison ………………………………... 90 OLD BUSINESS ……………………………………………………………………………………………. 91 • Governance Committee Nomination Report ……………………………………… 92-93 ADDENDUM ……………………………………………………………………………………………….. 94 • Item[s] of General Interest …………………………………………………………….…… 95-97 Page3 MEETING AGENDA Page4 2ND QUARTER OF FUND YEAR 2018 BOARD OF DIRECTORS MEETING Wednesday – June 20, 2018 1:30 PM – 3:00 PM 1,2 EcoTarium, 222 Harrington Way, Worcester, MA AGENDA • Welcome and Introductions • Roll Call • Minutes of March 8, 20183 • President’s Remarks and Report • Committee and General Reports o Membership / Marketing o Finance ° Financials ° Investments o Claim & Loss Control ° Annual Safety Day Debrief ° Fund Year 2018 Health & Safety Grant Program ° Fund Year 2019 Nick Bakker Award o Membership • Administrator’s Report o General Matters ° Transition Overview and Update ° ISCC New Underwriting Manager / FutureComp Personnel o Fund Year 2019 Rates and Rate Plan Study ° Vote to Be Taken • Old Business o Board Elections o Board Code of Conduct / Conflict of Interest et al - Update o Other • New Business o Division of Insurance Examination of Fund Year 2017 o Other • Adjournment o Next Meeting – ° Board Meeting & Retreat – Thursday September 27, 2018 ° Location – Naismith Memorial Basketball Hall of Fame, Springfield, MA • Executive Session as May Be Required [Next Meetings of the Board will convene on September 27 and December 12, 2018] 1 Annual Meeting and Lunch at 11:30 AM 2 Time Approximate to Follow at Adjournment of the Annual Meeting 3 Convened by teleconference due to inclement weather Page5 MINUTES – MARCH 8, 2018 Page6 Independent Schools Compensation Corporation Inc. 1st Quarterly Meeting of the Board of Directors Thursday, March 8, 2018 by teleconference MINUTES On behalf of Independent Schools Compensation Corporation and the Clerk of the Board, Edward Gotgart, as the Administrator, the following is respectfully submitted as summation of the Fund Year 2018 First Quarterly Meeting of the Board of Directors that convened by way of teleconference on Thursday March 8, 2018 from approximately 12:32 pm to 2:07 pm. As a result of and based on discussion from Agenda and Report distributed in advance by way of email and the Group’s web page to the Board and attendees: I. Welcome and Introductions – President Thom Greenlaw expressed his appreciation and gratitude to one and all for dialing in and thereto briefed the Board and Administrative Team the forthcoming day’s meeting. II. Roll Call - Todd Johnson, by voice roll call, noted in attendance: • Board of Directors Present Amherst College Stephen Nigro College of the Holy Cross Elizabeth Dionne Belmont Hill School Laura Gaudette Dana Hall School Charles Breslin Rivers School Bruce Amsbary Roxbury Latin School Peter Shea Summit Montessori Thompson Greenlaw Wellesley College Melissa Fletcher • Board of Directors not in Attendance Boston Symphony Orchestra Kathleen Sambuco Middlesex School Mathew Crosier Pingree School Jock Burns Smith College Rosiane LaRose St. Marks’ School Edward Gotgart Trustees of Clark University Anthony Penny A quorum of Board Members was present. • President Emeritus - Cornelius Bakker unable to attend • Member Guests - None • Administrators/Advisors FutureComp/USI Insurance Solutions LLC Lisa Brennan Chuck Knowles Kathy Camire Joanne McDermott Steve Grahn Jacob Stone Todd Johnson HUB International - Robert Mansfield Independent Schools Compensation Corporation – Clerk to the Board of Directors - Karen White OPUS Investment Management - William Piel, Michael Rose Risk Strategies - Dick O’Connell III. Minutes of Meeting – December 13, 2017 – The Administrator confirmed that the Minutes are on file with the Group’s corporate records. The Minutes were accepted as entered. Page7 IV. Presidents’ Remarks and Report – Thom advised the Board, it’s Executive Committee has commenced to meet monthly with the Administrator to assure that the Group’s transition and current matters are being effectively managed. He, as well, expressed his appreciation to Karen White to and for the development, implementation and delivery of the new member board orientation. • Electronic/Computer Policy Guidelines – Jack Stone reviewed the draft Computing Device Policy of Ownership and Use Guidelines with agreement of the Board that said Guidelines will be modified to include current purchase receipt, inclusive to the reimbursement process. VOTED: Independent Schools Compensation Corporation, effective March 8, 2018 adopts for use until modified and/or rescinded, as attached herewith these Minutes, Computing Device Policy of Ownership and Use. Thereto, the Administrator is to provide each Board Member with the Computing Device Policy of Ownership and Use and Reimbursement Form. V. Election of Board Members • Nomination Report – • Votes to be Taken – No action taken at this time. (1) VI. Committee and General Reports • Finance – (2) o Financials – Joanne McDermott provided an overview of the unaudited consolidated financials; for period ending December 31, 2017. Joanne further advised the Board that the Group’s certified public accountants have scheduled the annual audit for Fund Year 2017; at the offices of Meadowbrook TPA Associates. o Investments – OPUS Investment Management reminded the Board of the Group’s objectives and thereto compliance with the requirements set forth by the Commonwealth of Massachusetts’s Division of Insurance. Bill Piel and Mike Rose then provided a summary of activity and took under advisement, the suggestion of potential modification of benchmark/benchmarking. OPUS, as well, briefed the Board pursuant to current economic outlook matters and the potential impact to the Group. The Administrator noted that the financials are on file with the Group’s corporate records. • Claim & Loss Control – Laura Gaudette summarized the, this day’s, Committee Meeting for the Board that included (as delineated in the Board Agenda Packet) new and more helpful methodologies for reporting information to the Committee. Additionally: FutureComp provided an update of the fatality claim from Kripalu Center for Yoga and Health, Inc. and actions, rationale, thereto taken. Thom advised the Board of the Group’s position (decision process) and the reasoning of it. o POPE Program Policy Issue/Discussion – Laura confirmed that the POPE Program has been noted by the Committee as in need of clarification pertaining to what will be and is reimbursable. o Annual Safety Day ° Bakker Award – The Board was informed that the awardee, Member, has been identified and that said recognition will take place at the Annual Safety Day. ° Health & Safety Grant Program – The Board was advised that those (10) Members whom received grants in Fund Year 2017 have been invited to share their experience with the Members at the Annual Safety Day, during a panel discussion. • Membership – Bob Mansfield advised the Board of current initiatives being undertaken with two prospective members as well as ongoing prospecting activities. The Board affirmed that it looks forward to continued activity pursuant to membership and will consider meeting in the future with affinity groups of members through their organizations as well as incentive programs in the current membership. (1) The Board of Directors Class of 2018 Election tabled to take place as soon as reasonably possible. (2) Joanne McDermott, on behalf of Bruce Amsbary, confirmed that additional related financial content is available within the web page portal. 2 Page8 • Excess Workers Compensation – Dick O’Connell of Risk Strategies advised the Board that the renewal has been completed. The audit of Fund Year 2017 will be undertaken