1. Will Your JPA Pass the Competition Test? Presented to: CAJPA ’ s Fall Conference & Training Seminar South Lake Tahoe September 11, 2013 Presented by: Michael M. Kaddatz, CPCU, ARM Director, Risk Consulting Solutions Bickmore mkaddatz@bickmore.netmkaddatz@bickmore.net 714-426-8511

2. The Heat is On Competition Cost Pressures Decision-Maker Turnover Competition is the keen cutting edge of business, always shaving away at costs. Henry Ford

3. Lost that Lovin’ Feeling Board Member’s #1 Loyalty Newbies Lack of a Uniting Crisis Passion is momentary; love is enduring. John Wooden

4. Remembering Why

5. Top Reasons Pool Members Evaluate Alternatives Claims Handling Incidents Perceived Cost Allocation Inequities Incompatibility with Other Members Lack of Control Control your own destiny or someone else will. Jack Welch

6. Top Reasons Pool Members Evaluate Alternatives (cont’d) The Lure of Self-Insurance Pool Inflexibility New Management Honest Due Diligence Diligence is the mother of good luck. Benjamin Franklin

7. Withdrawal Considerations How Do We Get Out?: Minimum Commitment (Money & Time) Advance Notice Ability to Rescind Notice Net Asset Entitlement/Forfeiture Post Departure Obligations Parting is such sweet sorrow. William Shakespeare

8. Pool Evaluation Criteria Ownership Issues: When Established Membership Composition Organization Type Governance Regulatory Oversight

9. Pool Evaluation Criteria Coverage Features: Scope of Coverage Limits (Shared?) Retentions and Deductibles Flexibility

10. Pool Evaluation Criteria Financial Soundness: Net Contributions to Net Assets Loss Reserves to Net Assets Net Assets to Pool Retention Assessable vs. Non-Assessable Independent Rating Reinsurance Quality

11. Pool Evaluation Criteria Ownership Obligations / Entitlements: Minimum Commitment Governance Participation Net Asset Ownership Profit Sharing

12. Pool Evaluation Criteria Claims Fit: Administrator Legal Representation Decision Voice Dispute Resolution

13. Delivering on the Promise Claims Fit: Administrator Legal Representation Decision Voice Dispute Resolution

14. Evaluating Pool Management Management = Staff + Board How Long has CEO Been in Place? Does the Pool have a Business Plan? What do Pool Members Say? What Initiatives is the Pool Pursuing?