School Superintendents To Be Assessed Extra $ For Troubled Insurance Pool
LEXINGTON, Ky. - School Superintendents from across the state have been told they will soon be assessed a portion of an estimated 50 to 60 million dollars to cover a shortfall in the insurance pool that covers district workers compensation and liability claims.
The Kentucky School Boards Insurance Trust, or “kizbit”, was created more than 30 years ago by the Kentucky School Boards Association. Since 2009 the fund has been managed by the Kentucky League of Cities. KLC Executive Director Jon Steiner says a recent independent analysis shows the pool has had a long history of paying out more money in claims than it’s been collecting in premiums.
“Basically with the benefit of hindsight and a new actuary looking back we were able to determine that the reported deficit had actually grown a great deal going back as far as 1990, and that we were at a point where the program needed to assess the members.”
Steiner says the amount each district owes will be calculated based on how long they were members of the insurance pool, as well as each district’s claims history. He says that process could take up to 6 weeks to complete. The trust will officially disband at the end of June, meaning districts will have to search for their own providers.
Steiner says the Kentucky School Boards Association is establishing a bond program "so that schools can take up to 20 years to at a low interest rate to pay off this deficit."
Fayette County Schools Superintendent Tom Shelton tells WUKY his district’s share of the debt could be as much as $2 M.