This memo is in response to an email sent by League of Nebraska Municipalities Director Lynn Rex concerning recent action taken by the League Association of Risk Management (LARM) Board.

At the September 27, 2017 LARM Board meeting, members were advised of a recent audit from the Nebraska Department of Insurance that basic changes were needed to be made to the LARM organizational structure.
The following excerpt from the Department of Insurance letter to LARM pertaining to that required change is below:

“Approximately four (4) years ago, the Association separated its payroll, healthcare and pension from the League, however, the agreement has not been updated to reflect the change in relationship between the entities. It is recommended the Association amend the agreement with the League, as needed, to reflect the change in relationship.”

As the Nebraska Department of Insurance governs all insurance industry in Nebraska, the Board voted to comply with the Department’s request.

It is not apparent why Rex and the League Board are against complying with the Department requirement. The League continues to annually receive 2% of all LARM pool premiums. That amount in 2016 was $153,763.
LARM staff have worked diligently to provide quality risk management services to its 166 members across the state that include cities, villages, fire departments, natural resource districts, sanitary improvement districts, landfills and economic development districts.

The LARM Board members and staff recognize the contributions of the League in establishing LARM 28 years ago when it was difficult for municipalities to obtain insurance for a reasonable cost. As LARM has grown and become independent of the League, LARM still makes the yearly payment to the League although it no longer receives any of the services once provided.

Change can be confusing. The LARM Board recognizes that and is willing to answer any questions about establishing LARM as a Risk Management Pool separate from the League. Contact information can be found at www.larmpool.org.

Thank you.

Gerald Solko
LARM Board Chair