Assessments are possible in any self-insurance risk management program but can only occur if the program is deemed underfunded by the Missouri Department of Insurance. To protect this program from the possibility of an assessment, the following steps have been taken:
- The loss fund has been developed to take into consideration maximum loss situations. This is a very conservative approach.
- The excess insurance coverage has been structured to assure that the fund will be protected against catastrophic losses.
- A loss control program has been specifically designed to promote safety awareness and control frequency of loss.
It is very important to keep in mind that in a commercial insurance program any company that has frequent and severe losses essentially has an assessment the following year. This assessment is in the form of higher insurance premiums.