About PRISM

At the recent Board of Directors meeting, staff updated the 145 attendees on the state of PRISM. In case you were not able to attend, I wanted to share the highlights with you. Staff presented information on the progress made on our strategic initiatives and what lies ahead, reviewed PRISM and program financial positions, reviewed the state of our major programs and highlighted new risk management initiatives.

Much was accomplished this past year and following are some of the significant highlights.

PRISM launched Spectra, our own claims management system for general liability claims in October of 2023 and will launch the workers’ comp instance this spring.

We reached a commutation settlement with AmTrust.  Since 2020, PRISM had been involved in an ongoing dispute with AmTrust North America, Inc., one of the insurers that PRISM worked with between 2011 and 2017. In April 2024, after four years of negotiations, litigation, and arbitration, we reached a settlement agreement with AmTrust that PRISM’s staff and governing committees felt represented the most prudent path forward.  The settlement gave PRISM a partial, but significant recovery of its claims against AmTrust and enabled us to move forward along a clear path.

We launched the PRISM Program Internal Guarantee Account (PIGA), to protect PRISM property and casualty programs from the impacts of carrier insolvencies and, for Miscellaneous Programs where there are aggregate limits. PIGA will provide a layer of protection in the event of aggregate limit exhaustion, similar to a guarantee fund like the California Insurance Guarantee Association (CIGA). 

Unfortunately, the state of the property and casualty market has not greatly improved. We are pleased that all of the Programs renewed for 2024/25 successfully. Prices increased again in most cases, including in our Pool Layers, but not as dramatically as in prior years.  Most reinsurers did not change their risk appetite or available capacity, and we saw a couple of new entrants into the space. However, our renewals are often reflective of our own loss history, which has continued to trend poorly due to increased settlement values, astronomical jury verdicts, and catastrophic events such as winter storms.  As we have reported previously, this trend continues to affect all public agencies in California, as well as other jurisdictions in the western United States. PRISM’s group volume and great reputation will certainly continue to help to mitigate the impact of the marketplace. Several documents have been prepared to assist the members in understanding and communicating this information. PRISM and Alliant staff are also available to meet with your management and encourage members to have us do a presentation for your governing body. 

Membership continues to be stable and our member retention rate at renewal was 99%.  The number of total covered entities increased by 35, which is slightly more than in recent years. Today, there are almost 2,200 public entities, including members of members, which are covered in one or more of our major programs. This shows the PRISM programs continue to be attractive and competitive, even in this environment.

PRISM continues to be a leader in our industry.  We are recognized as one of the largest and most successful pools in the nation.  For 2023/24, our annual revenue was $2.02B and for 2024/25, we estimate the revenue to be $2.3B. PRISM’s net position is $224M for the fiscal year 2023/24, and another financial highlight is the return of $6.5M to PWC members.

PRISM ARC has created a greater investment income rate of return to our portfolio earning a consolidated rate of 6.78% this past year, that when consolidated with the PRISM portfolio, has created a total rate of return of 6.04%. Additionally, PRISM now has nine national participants for whom we have collected of $16M in premium to date and have a zero percent loss ratio.

PRISM employee benefits programs continue to bring rate stability to our members. PRISMHealth has 47 county and public agencies providing coverage to 43,000 employees/retirees and is now the second largest public entity Health Plan in the state with over $750M in premiums. Together with the Dental, Vision and other various employee benefit programs, PRISM continues to offer a robust suite of employee benefit coverage programs.

There are many other significant accomplishments this past year, far too many to recognize here, but in short, some include the creation of ConcernPlus – First Responder Program,  PLIP transitioned to InsureOne offering a suite of carriers to provide auto, home and other personal lines of insurance to member employees, the transition to in-house EPL services with the retirement of Patti Eyres, the initiation of task forces to focus on determining the feasibility of creating a new JPA to provide Jail Medical Services and the creation of a JPA for TPA services.

As always, if you have any questions, please feel free to reach out to me, any staff member or your Alliant broker.