TBG FAQ's...

ASSESSMENTS:
Have you ever had an assessment of the members? No, TBG has been able to build a surplus to be used for any adverse claims year. The key to preventing assessment is growing a surplus. The Board of Trustees has taken a very conservative approach regarding surplus, and has decided to invest the surplus in case of an unexpected bad-claim year. We have given back thirteen dividends, covering six fund years. Some members, with loss ratios greater than 25%, have received dividends of 29%, 49%, 43%, 25% and 12% of their premium for those fund years.

DISTRIBUTION OF SURPLUS:
As a new member, when can I expect to receive a distribution of surplus? The Board of Trustees makes that decision based on fund years that have had enough time to establish stable numbers on claims. Then, the Department of Commerce reviews our numbers and gives final approval for the distribution. In our initial years, we had to wait six years for the first dividend because of the need to grow a surplus. Now that we have paid thirteen dividends, covering six fund years, we hope to pay initial dividends approximately eighteen months after the end of each fund year. Again, distributions are based on the loss history of the fund and are not guaranteed. *

PREMIUMS:
How is my premium calculated? Your premium is calculated in much the same way as insurance companies do it now. TBG establishes rates each year that are a multiple of Minnesota pure-premium rates published by the MWCIA (Minnesota Workers' Compensation Insurers Association), the same as insurance companies do. We continue to calculate your experience modification factor, for premiums over $3,000, using the same formula used by the MWCIA for all our members, which tracks your individual claims history. We can then discount your premium based on established credits that are available, in order to be competitive with the insured market. Every year we send your agent the renewal quote showing how your premium is calculated and your agent then delivers it to you. If your business operation changes, we have the flexibility to make adjustments to your premium. You can call us directly and know that we will be responsive to your needs, since we are all in this fund together.

ASSET PROTECTION:
How does TBG protect its assets? Premiums and investment income not used to pay claims and administration expenses create surplus for the group. Surplus from our early years is accumulated for the purpose of providing for a catastrophic loss, or a number of losses that would exceed a certain dollar amount in any given year. In the event, of any given year, claims exceeded our surplus and reinsurance policy, our members have the ultimate protection.*

FUND MANAGEMENT:
Who manages the program? TBG is managed by the members. The members elect twelve of their own to serve on the Board of Trustees. The Board makes all the decisions for the group. This self-management assures that the members come first. The Board has hired a full time Fund Manager and support staff, as employees of TBG, to handle the day-to-day operation. The TBG staff is responsible for member services; agent services; underwriting - including quotes, renewals and policy issuance; accounts receivable/payable; auditing; marketing; loss control; graphics/website; and general information. The Board has also contracted with a licensed Third Party Administrator (TPA), Meadowbrook Insurance Group, to provide claims service. The Board has hired other service providers such as an attorney, an independent accountant who audits the group, and an actuary.