Wisconsin municipalities are granted specific authority under Wisconsin law to organize municipal mutual insurance companies; in fact, that statute, enacted in 1977 by the State Legislature, encouraged the practice in response to major premium increases by commercial liability carriers. However, once the law was passed, the insurance industry went through a particularly "soft" cycle where commercial premiums actually decreased.

That soft cycle hardened abruptly in mid-1984. Municipal liability coverages were either curtailed or canceled altogether, and premiums skyrocketed for what little insurance was available. That constriction caused many communities to evaluate insurance alternatives.

These communities, now members of CVMIC, adopted insurance strategies to achieve budget stability, insurance-rate predictability, stable premiums and a constant high level of insurance protection. CVMIC became Wisconsin's first municipal mutual insurance company providing all lines of liability coverage and the country's fourth fully capitalized municipal mutual insurance company.

PURPOSE

CVMIC's purpose is not to avoid the commercial insurance market; rather, the program is structured to better utilize commercial reinsurance capabilities. The goal of the program is to reinsure when it is commercially available and economically feasible, and to rely on the self-funded, pooled coverage when it is not. CVMIC, as a financially independent and economically sound insurance company, enjoys direct access to the reinsurance market.

In the initial stages, participants formed an Intergovernmental Cooperation Commission known as the Wisconsin Municipal Insurance Commission. This group was entrusted with accomplishment of two tasks: first, to develop the structure of the Mutual and second, to issue a revenue bond to capitalize the organization. The revenue bonds were (and continue to be) secured by general obligation bonds issued by each member.

MEMBERSHIP BENEFITS
VITAL, RESPONSIVE INSURANCE PROGRAMS

Members enjoy the benefits of cost-effective group purchase insurance programs that address the essential areas of risk experienced by municipalities throughout the state:

Self-Insured Municipal Liability Insurance Program

• $5 million in limits, each and every covered occurrence, annual aggregate of 4 times the members self-insured retention.
• Customized Municipal Liability coverage form.
• Self-Insured Retention options, starting as low as $10,000 per occurrence.
• Three-year, guaranteed-cost plan.
• Rates set by actuary. Realistic rates supported by capitalization.

• For those municipalities wanting higher limits, this program provides excess liability of $5 million above the $5 million offered by CVMIC.
• Allows participants to take advantage of group-purchase structure and enjoy low cost effective rates not available individually.

• Provides extremely low group-purchase rates, so members save money over individual purchase plans.
• Leads the industry in dividend programs. Depending on group performance, members can reap large rewards for good experience. (Primary program only).

• Offers $5 million in per-occurrence limits and four separate deductible options. Members can choose the most cost-effective retention and coverage amounts in accordance with their individual schedules.
• "Replacement Cost" valuation applies to most scheduled vehicles, mobile equipment or specialized equipment. Members can issue eligible items at rates competitive with the Local Government Property Insurance Fund.

• Offers a $50 million per accident limit, and allows members to select individual deductibles.
• Allows participants to take advantage of a group-purchase structure and low, cost-effective rates not available on an individual basis.

• Low cost, convenient, short-term coverage designed specifically for purchase by tenants and users of the city-owned/operated facilities. Protects both sponsors and CVMIC members during concerts, weddings, parades, etc. Small Consultants Public Entity Program (SCOPE)
• Low cost, short-term coverage designed to provide professional liability (errors & omissions) for small firms (minority or women's businesses,) etc., providing service to the CVMIC members.

• Offers coverage under one master policy, limits of $1 million per member with deductible options.
• Participants receive attractive pricing, broad coverage terms and risk management services.

• General Liability
• Automobile Liability
• Police Professional Liability
• Public Officials' Errors and Omissions
• Paramedic/EMT (Incidental) Medical Malpractice Liability

CVMIC's program incorporates features that control the ultimate liability of its members. Rather than expecting its members to pay their SIR limits for every occurrence within a policy period, the policy provides an annual aggregate equal to four times the members self-insured retention. After the aggregate limit has been met the policy will then respond on a first dollar basis.

To further protect CVMIC members' assets, the program is designed to reinsure, most of its exposures to risk, in the higher loss layers with commercial insurers and/or re-insurers. This allows members to enjoy the guaranteed-cost benefits of the commercial marketplace when it makes good financial sense to do so.