Although investment income was down due to market conditions, a $2 million decrease in losses–paid claims and unreported losses– allowed room on the balance sheet for the premium decrease.

Another key financial is CUSIG's age. Regulators set reserve amounts for self-insured groups and determine them based on actuarial calculations. New self-insured groups must use conservative standardized industry calculations until actual claim histories prove the group's stability and performance. CUSIG members perform significantly better than their peers and will continue to see reserve decreases for another three more years, said Ed Cassidy, chairman emeritus.

Cassidy explained that not only do credit unions tend toward lower workers' compensation claims–sprains and strains, along with repetitive injuries fill credit union case files, compared to more serious injuries incurred by factory workers–but CUSIG credit unions are the cream of the cooperative crop, utilizing preventative and claim management strategies, required for CUSIG membership, to significantly lower claim amounts and return employees back to work faster.

"We are really doing better in total claim losses incurred, and that's reflective of the work you do everyday working with employees and being proactive with worker's comp claims," said Ruth Duncan, chair of the claims committee and senior vice president of human resources at $1.5 billion North Island Credit Union.

"At North Island, we encourage employees to report pain early," Duncan said. "We don't care about how many claims we have, but how much we pay out for each claim."

CUSIG officers were also boasting about a compliment from the group's independent auditor, Sacramento-based Gilbert & Associates, which declared the CUSO the best managed of all self-insured groups it reviews.

Seventeen California credit unions formed CUSIG in 2004 in an attempt to reduce costs for workers' comp, a staggering budget item that runs around half a million dollars annually for institutions $500 million and up in this litigious state.

CUSIG Director Tom Swedberg, head of human resources at WesCorp, said CUSIG's model would work in other states that have high workers' compensation costs, naming Texas, New York, Florida and Illinois as likely candidates.

Swedberg was particularly keen to discuss a current feasibility study looking into organizing a risk retention group that would provide a range of

cost-effective medical, dental, vision, and short-

and long-term disability programs to qualifying credit unions.

"If the idea proves feasible, these credit unions can then organize an RRG that will team with a number of providers, and most importantly from the regulator's standpoint, a captive insurance

program to eliminate the issue of joint and several liabilities, creating a new entity called CU-RRG," Swedberg said.

"By partnering with a captive insurance program, CU-RRG will protect its members with specific and aggregate stop-loss insurance in much the same manner as CUSIG members are protected from catastrophic levels of claims by the insurance it carries."

–[email protected]