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Sizable claims hit Newton County government’s insurance cost
Newton County Historic Courthouse
The Historic Courthouse in Covington where the Newton County Board of Commissioners meets. - photo by File Photo

COVINGTON, Ga. — After a tumultuous year filled with multiple sizable claims and a pair of possible discrimination lawsuits against the Newton County Board of Commissioners, the Board finds itself looking for a new insurance company, not to mention insurance costs that have doubled in the last year. 

The Board was told in August that Travelers Insurance Co. would not be renewing its coverage for the county due to insurance costs that skyrocketed from $986,000 to $1.9 million over the last year and a loss ratio of 154%.

Travelers’ current policies expire Oct. 1, and Gallagher Insurance, Risk Management and Consulting has been tasked with finding new insurance for the county. 

Scott Thomason, who spoke on behalf of Gallagher during Tuesday’s Board of Commissioners meeting,  stopped short of putting exclusive blame on the Board’s discrimination allegations as the sole reason for the discontinuance of coverage. But he mentioned it as part of a set of determining factors. 

“It was a challenging renewal period based on marketing conditions,” Thomason said. “Primary carriers pulled out of the market. But also, based on your loss experience, Travelers felt they couldn’t cover the cost.” 

The news drew the ire of District 3 Commissioner Alana Sanders and District 4 Commissioner J.C. Henderson who both, along with District 2 Commissioner Demond Mason, were specifically named in a pair of ante litem notices triggered by ex-county attorney Megan Martin and former County Manager Lloyd Kerr — one of which alleged racial discrimination against Martin and Kerr, both white. Sanders, Henderson and Mason are Black. 

“The local paper used my name, J.C. Henderson, and said we discriminated against two former employees,” Henderson said. “What I concluded myself personally is three commissioners of color did not renew a contract, therefore it’s discrimination…show me what I’ve done, in writing, and how it’s discrimination against the county manager and our former county attorney. I think you owe me that if you’re going to put my name in the paper and accuse me of doing something.”

Sanders suggested she’d like to see future policies covering the county include a clause that requires an insurance company to go before the BOC “before any settlement, no matter what.” 

“It is my concern that whatever suits may come before us are taken out of our hands,” Sanders said. We’re thrown out there and we’re not protected in things we have no control over … I would like to know which cases would not come before the board and which cases would come before the board, because that’s also protecting the citizens of this county and the officials that are in place making policies.”

Thomason called that request a “tricky situation,” noting that any insurance company that covers the county would be able to have the final say on claims and settlements. Thomason’s suggested solution to the board was to pursue a self-insured program. 

He also reiterated the fact that Gallagher is the Board’s “consultative insurance broker that represents you in the marketplace to seek property and casualty coverage,” but that “we don’t make decisions. We are a claims advocate and advisor through the claims process. I can’t comment on any specific issue.”

“I think it does come to what we’re proposing today,” Thomason continued. “You’re going to like a little more control, but also know that at the end of the day, with the insurance company, it’s their dollar, it’s their decision. 

“We want to have input. We want to have some control. Under a self-protected program, you’re gonna have a lot more control. However, we do not want to have every little nickel and dime claim come to the board. That does not make sense. That is not best practices, nor what we’d recommend.” 

Thomason, and interim county manager, Jarvis Sims also stated that the self-insured program option would provide a best-fit long term solution without negatively impacting the county’s budget as a whole. And county finance director Brittany White said budget amendments — using funding from better-than-expected Local Option Sales Tax (LOST) collections — would make sure of that. 

“We’re going to amend the budget to increase our LOST revenues, and then we’re going to offset with an expense in our insurance claim line item,” White said.

District 5 Commissioner Ronnie Cowan cautioned the board to be wary about what actions that trigger more similar lawsuits could bring to the board. 

“I want the board to understand, if we have another year like we did before, you will break that bank,” Cowan said. 

“That’s county money that’s going to be set aside. We’re going to pay a premium for insurance, but the costs to pay the losses are going to come out of that fund. 

“We don’t have sovereign immunity in Georgia anymore, except in limited circumstances. I would suggest ya’ll be very careful about taking actions on things, listen to your county attorney and try to make the right decisions.”  

The BOC approved Gallagher to negotiate a self-insured program with a unanimous 5-0 vote.