2018-10-16T06:07:09-07:00 2017-12-31 990 2017-01-01 561179542 North Carolina Rate Bureau NORT 9197839790 2910 Sumner Boulevard Raleigh NC 27616 Edith Davis CFO 2018-10-16 2017 2018-06-14 16:35:46Z 14799251 false false X https://www.ncrb.org/ncrb X 1977 The Bureau was established under Article 36, Chapter 58, N.C. General Statutes. The purpose of the North Carolina Rate Bureau is to administer Property and Casualty Rates for the insurance industry in North Carolina. The Bureau maintains rules and regulations and establishes premium rates for motor vehicle, workers' compensation and property insurance. The Bureau also ensures the availability of workers' compensation insurance to any eligible risk in North Carolina by assigning the risks to members on an equitable basis All expenses are related to those functions. The N. C. Rate Bureau receives no grants and all expenses are borne by its member insurance companies in proportion to written premiums. 12 12 70 0 0 15130770 14799250 0 1 1 15130771 14799251 0 0 5753132 5787641 0 0 8973345 8700841 14726477 14488482 404294 310769 2567048 2180731 1315562 1434024 1251486 746707 The Bureau was established under Article 36, Chapter 58, N.C. General Statutes. The purpose of the North Carolina Rate Bureau is to administer Property and Casualty Rates for the insurance industry in North Carolina. The Bureau maintains rules and regulations and establishes premium rates for motor vehicle, workers' compensation and property insurance. The Bureau also ensures the availability of workers' compensation insurance to any eligible risk in North Carolina by assigning the risks to members on an equitable basis All expenses are related to those functions. The N. C. Rate Bureau receives no grants and all expenses are borne by its member insurance companies in proportion to written premiums. false false Workers' Compensation Assigned Risk PlanThe Bureau assures the availability of workers' compensation insurance to any eligible risk in North Carolina by assigning the risks to members on an equitable basis. The Bureau receives premium payments which are deposited and then immediately disbursed to an assigned member company. Since the Bureau acts only as a pass-through for these premiums, these premiums are not recorded on any statement of cash receipts and disbursements.In 2017 the Bureau collected and disbursed premiums of $43,428,844 and $43,288,379, respectively, related to the workers' compensation assigned risk plan. Statutory Annual Data Reporting Requirement for Member Companies Per Article 36 of Chapter 58 of the General Statutes of North Carolina requirements, the North Carolina Rate Bureau must collect on an annual basis information and reports from its member companies. This annual data is used to prepare rate filings, apportionment of expenses, and determination of expense allowances and assessments. The reports that must be collected include Property and Casualty annual Statements and Insurance Expense Exhibits, as well as Private Passenger Automobile, Homeowners, Dwelling and Mobile Homeowners Expense Experience and installment payment data. The Governing Committee approved a penalty fee of $100/day for the late submission of this annual data. During 2017, $4,600 was collected from companies submitting late data. One of the purposes of the North Carolina Rate Bureau is the establishment and administration of classifications, rules, rates, loss costs, rating plans, policy forms and policy provisions for the Automobile Insurance, Property Insurance and Workers Compensations Insurance pursuant to Article 36 of Chapter 58 of the General Statutes of North Carolina (excerpt from North Carolina Rate Bureau Constitution). In order to fulfill this purpose, the North Carolina Rate Bureau files proposed changes on behalf of the Bureaus member companies to North Carolina Commissioner of Insurance. Below is a listing of some of the Bureau's program service accomplishments: AutoRevised automobile and motorcycle insurance ratesReleased modified model year and symbol relativities that reflected a shift in the model year base from 2016 to 2018PropertyBegan consideration for a Flood program evaluation and search for Flood Plan committee membersRevised manual rules and rates for Homeowners Windstorm and Hail Policy ProgramReleased revised Homeowner AOI relativity factors, Protection/Construction relativity factors, base rates, and modified wind and hail exclusion credits and windstorm loss mitigation credits to reflect construction typeWorkers CompensationFiled an Experience Rating Modification Factor Revision endorsementReleased an enhanced online format of the North Carolina Basic Manual for Workers Compensation and Employers Liability (Basic Manual) and the North Carolina Statistical Plan Manual (Stat Plan Manual)Filed revisions to the North Carolina Basic Manual Rule 3-D-Professional Employers OrganizationFiled revisions to North Carolina Basic Manual for Workers Compensation and Employers LiabilityAnnounced new web application, ManageOwnership, to provide means for submitting ownership changes Filing proposed changes to workers compensation insurance advisory loss costs, rating values and miscellaneous values false false false false false false false false false false false false true true false true false false false false false false false false false false false false true false false false false false false false false false false false false false false false false false true 33 0 true 70 true false false false false false false false false false false false false X 12 12 false false false false true true true true true false false false true false true true false true true false X The Bureau 9197839790 2910 Sumner Boulevard Raleigh NC 27616 Liberty Mut Ins Co MFord Gov Committee 0.00 0.00 X 0 0 0 American Home IFeuerlicht Gov Committee 0.00 0.00 X 0 0 0 National Gen Ins Corp ALyon Gov Committee 0.00 0.00 X 0 0 0 USAA LSukow Gov Committee 0.00 0.00 X 0 0 0 Hartford Fire Ins E Mize Gov Committee 0.00 0.00 X 0 0 0 Nationwide Mutual TSouder Gov Committee 0.00 0.00 X 0 0 0 Travelers Ind Co RAaron Vice Chairman 0.00 0.00 X 0 0 0 Allstate Ins Co JJabben Chairman 0.00 0.00 X 0 0 0 NC Farm Bureau RBatdorff Gov Committee 0.00 0.00 X 0 0 0 Unitrin Auto Home KFlint Gov Committee 0.00 0.00 X 0 0 0 State Farm Mut ABentley Gov Committee 0.00 0.00 X 0 0 0 Erie Ins Exchange JBloom Gov Committee 0.00 0.00 X 0 0 0 Raymond Evans General Manager 37.50 0.00 X 281602 0 0 Edith Davis CFO 37.50 0.00 X 104851 0 0 Joanna Bilouris Chief Operating Officer 37.50 0.00 X 186679 0 0 Frank Lonnett Director, IT Serv 37.50 0.00 X 138048 0 0 Vicki Godbold Chief Adm Officer 37.50 0.00 X 183076 0 0 Laura Lee Longest Director, SW Dev 37.50 0.00 X 140582 0 0 Adrienne Bizzell Mgr, IT Projects 37.50 0.00 X 133958 0 0 Andrew Montano Director, PL 37.50 0.00 X 126278 0 0 David Sink CFO 37.50 0.00 X 160132 0 0 1455206 22 true true false Nelson Mullins Riley & Scarborough LLP PO Box 11070 Columbia SC 292111070 Legal - NCIGA 225842 2910 Sumner LLC PO Box 33483 Raleigh NC 27636 Building rental 474780 Young Moore & Henderson 3101 Glenwood Ave Raleigh NC 27622 Legal - NCRB 1097301 Wellington Management Company LLC 280 Congress Street Boston MA 02210 Invstmt Mgmt - NCRF 643231 Spectrum Partners LLC 7701 France Ave So Ste 450 Edina MN 554353200 IT Mgmt & Consulting 300000 8 0 Membership Dues & Assmts 524298 14799250 14799250 14799250 0 0 0 0 0 0 0 0 Miscellaneous (Schedule) 524298 1 1 1 14799251 14799251 X 0 0 0 0 573132 0 3242458 654649 921175 396227 0 726767 20800 0 0 0 6959916 1090 116128 369418 0 314937 49957 0 0 0 0 0 40739 Luncheons 49493 Subscriptions/Memberships 48040 Taxes 3591 Miscellaneous -35 0 14488482 0 0 0 0 1587463 1208994 0 206414 85704 0 0 0 0 0 0 0 0 0 0 773171 886033 2567048 2180731 -17416 -17416 1332978 1451440 1315562 1434024 X 1251486 746707 1251486 746707 2567048 2180731 X 310769 -815548 X false true X true false Restricted Cash - Medical Premiums 886033 886033 Restricted Insurance for Retirees 565407 Restricted Medical Premiums 886033 1451440 14110013 -689238 -689238 14799251 14799251 14375620 -112862 -112862 14488482 14488482 X X false true X X X false false false David Sink CFO 160132 160132 Joanna Bilouris Chief Operating Officer 169769 16910 186679 Raymond Evans General Manager 255707 24000 1895 281602 Vicki Godbold Chief Adm Officer 166166 16910 183076 Part I, Line 1a: Relevant information in regards to selections on 1a. Part I, Line 1b: Reason for not following policy regarding payment provisions for expenses The reimbursement of social club dues was not documented in a written policy. During the employment search for a General Manager for the North Carolina Rate Bureau, the Bureau's governing committee verbally approved the policy of reimbursing social club dues. In addition, the paid travel for the General Manager's companion (wife) was verbally approved and such travel is infrequent, primarily for attendance of the organization's annual meeting. Client Note 1 Client Note 1 - Supplemental Information to Form 990North Carolina Rate Bureau, EIN 56-1179542Form 990, Part VII, Line 1a, Officers, Trustees, Key Employees, and Highest Compensated EmployeesForm 990, Part VII, Line 1a, lists the 12 Governing Committee member companies with voting rights as Institutional Trustees. An employee of the elected member company serves on the Governing Committee.Since these Governing Committee members are employees of various insurance companies, we cannot determine the average hours per week devoted to this responsibility.There was no compensation, contribution to a benefit plan, expense allowance paid to these Governing Committee members of the North Carolina Rate Bureau. Client Note 2 Client Note 2 - Supplemental Information to Form 990North Carolina Rate Bureau, EIN 56-1179542Form 990, Schedule J, Part II, Columns B(iii) & Column D, Officers, Directors, Trustees, Key Employees and Highest Compensated EmployeesThe employees listed in Part II of Schedule J are eligible and are participating in the organization's health and benefit programs including, medical, dental, vision, as well as basic life and accidental death and dismemberment coverage. The costs of these benefits for these employees are included in Line 9 (Other employee benefits) in Part IX, Statement of Functional Expenses, on Form 990.For eligible and participating associates listed in Part II of Schedule J, contributions to the organization's defined benefit plan are vested in 5 years. Actuarial estimates for the defined benefit plan are determined by employees' salary history, years of service, and anticipated retirement age. The specific costs associated with the employees listed in Form 990, Schedule J, Part II are not easily segregated and are included in Line 8 (Pension plan contributions) in Part IX, Statement of Functional Expenses, on Form 990.There were no deferred compensation agreements for any of the employees of the North Carolina Rate Bureau.No current year compensation for the employees listed in part II of Schedule J was reported in a prior year Form 990. Client Note 3 Client Note 3 - Supplemental Information to Form 990North Carolina Rate Bureau, EIN 56-1179542Form 990, Part VII, Section B, Line 1, Independent ContractorsThe expenses of 3 North Carolina organizations created by North Carolina state statute Chapter 58 (the North Carolina Rate Bureau created by Article 36, the North Carolina Reinsurance Facility created by Article 37, and the North Carolina Insurance Guaranty Association created by Article 48) are managed and paid by the 3 organization's shared North Carolina Rate Bureau accounting department. Each organization is a separate, unrelated entity guided by separate state statutes and governing documents and each organization maintains separate general ledger accounts and financial statements. At the end of each month, a report is generated that details the total expenses that were paid by the North Carolina Rate Bureau on behalf of the North Carolina Reinsurance Facility and Guaranty Association by the North Carolina Rate Bureau checking accounts; these amounts are then reimbursed to the North Carolina Rate Bureau from the North Carolina Reinsurance Facility and Guaranty Association's checking accounts.The annual Form 1099-MISC for the North Carolina Rate Bureau will reflect the total amounts paid to an independent contractor for all of the organizations listed in the above paragraph; these are the amounts that are reflected on Form 990, Section B, Line 1 for each listed contractor. The amounts reflected on Form 990, Part IX correspond to the net expense attributable only to the North Carolina Rate Bureau. Client Note 4 Client Note 4 - Supplemental Information to Form 990North Carolina Rate Bureau, EIN 56-1179542Form 990, Part XII, Line 2c, Committee responsibility for oversight of audit, review and selection of an independent accountantThe audit financials are drafted by the management of the North Carolina Rate Bureau and are audited by the Bureau's independent audit firm. Once the audit report has been generated, it is distributed to the Bureau's Governing Committee for review. Form 990, Part VI, Line 6: Explanation of Classes of Members or Shareholder Every insurance carrier that is is authorized to write Automobile Insurance, Property Insurance or Workers Compensation Insurance in the State of North Carolina is required to become a Member of the Bureau as required by the provisions of Article 36 of Chapter 58 of the General Statutes of North Carolina.Each Member must pay an annual membership fee for each category of insurance for which it is licensed to write in North Carolina. Each member must also annually or when requested, provide statistical data related writing Automobile, Property, or Workers Compensation Insurance. Form 990, Part VI, Line 7a: How Members or Shareholders Elect Governing Body Member companies of the North Carolina Rate Bureau elect 12 voting members to the Governing Committee. (There are also 2 non-voting Governing Committee members that are appointed by the North Carolina Governor that are not employed or associated with any insurance company or the North Carolina Department of Insurance.) Governing Committee members serve for three-year terms; the terms cannot be served consecutively. The Governing Committee, elected by the North Carolina Rate Bureau members, handle administration, supervision, and direction of all committees. The Governing Committee also appoints a General Manager, who under the supervision of the Governing Committee has general control of the Bureau's activities and associates. Form 990, Part VI, Line 7b: Describe Decisions of Governing Body Approval by Members or Shareholders One of the purposes of the North Carolina Rate Bureau is the "establishment and administration of classifications, rules, rates, loss costs, rating plans, policy forms and policy provisions for the Automobile Insurance, Property Insurance and Workers Compensations Insurance pursuant to Article 36 of Chapter 58 of the General Statutes of North Carolina" (excerpt from North Carolina Rate Bureau Constitution). In order to fulfill this purpose, the North Carolina Rate Bureau files proposed changes on behalf of the Bureau's member companies to North Carolina Commissioner of Insurance. The North Carolina Rate Bureau's proposed filings are subject to the Commissioner of Insurance's approval. If the Commissioner of Insurance disapproves a filing, the Governing Committte has the ability to follow the appropriate appeals process within the State of North Carolina.In general, the North Carolina Rate Bureau's Governing Committe is authorized and does make operating decisions on behalf of the member companies. However, in some rare instances, high level document changes do require a 3/4 majority vote from the Bureau's member companies. Form 990, Part VI, Line 11b: Form 990 Review Process The annual Form 990 is prepared internally by the organization's Accounting Manager using tax preparation software. The completed return, including schedules and other necessary supporting information, is then forwarded to the organization's Chief Financial Officer for review and approval. After the review and approval, the completed return is filed electronically to the Internal Revenue Service. The governing committee is notified when the return has been filed but does not receive a copy unless specifically requested by one of the member companies serving on the committee. Form 990, Part VI, Line 12c: Explanation of Monitoring and Enforcement of Conflicts Each new employee receives an organizational handbook that outlines the requirement of all employees to devote their full time to employment with the North Carolina Rate Bureau. If an employee is engaged in outside work or holds another job, the handbook specifically states that the other business cannot interfere with satisfactory job performance and attendance at the Bureau. Further, the Bureau requires that all employees fully disclose any possible conflict of interest such as outside employment to their supervisor or manager in order to prevent a compromising situation.Conflict of interest is also regularly reviewed at each North Carolina Rate Bureau Governing Committee meeting as well as every Bureau committee or sub-committee meeting. The North Carolina Rate Bureau's conflict of interest statement is included in the agenda and is referenced in every every governing committee, committee, and sub-committee meeting as a reminder to the governing committee and employees of their responsibilities. Per policy, members are not to vote, take action or use his or her personal influence on a matter that represents a personal conflict of interest. Form 990, Part VI, Line 15b: Compensation Review and Approval Process for Officers and Key Employees Compensation data is obtained through WorldAtWork, Mercer, and Aon Hewitt Associates salary surveys. Independent consultants have been utilized in the past to prepare guidelines and ranges for General Manager's and top management compensation, as well as conducting a full compensation audit.This data is presented to a Joint Compensation Sub-committee, consisting of 3 member companies, during the 4th quarter of the year. After a review, the Joint Compensation sub-committe will recommend ranges for salary increases, merit increases for the following year. These recommendations are presented to the organization's governing body for approval, normally during the last month of the calendar year along with a comprehensive budget presentation. Form 990, Part VI, Line 19: Other Organization Documents Publicly Available Since the North Carolina Rate Bureau was created by state statute, its organizational governing documents are public record. The conflict of interest statements are disclosed as agenda items and minutes in each governing committee, committee, and sub-committee meeting the of the Bureau.The financials of the organizations are made available to the public in these two manners:1) The annual filing of the organization's Form 990, Return of Organization Exempt from Income Tax, and 2) The appointment of two non-voting public members who are not employed or affiliated with any insurance company or the Department of Insurance to the Governing Committee by the North Carolina Commissioner of Insurance. The audited financial statements are presented to these members along with the rest of the Governing Committee on an annual basis. Other Changes In Net Assets Or Fund Balances - Other Decreases Reapportionment to Member Companies of 2015 Assmts & Expense = -$798898 Other Changes In Net Assets Or Fund Balances - Other Decreases Write off o/s Assmts/Mbrshps/Misc Fees/Refund to Carriers = -$16650