Insurance Premiums Surge Amid Rising Risks and Cyber Concerns

During a recent board meeting, the approval for the renewal of Surrey Insurance's Risk Management portfolio was a key topic of discussion. Mr. Johnson Stocks presented the request, highlighting significant increases in premiums for various insurance lines, including general liability, property, and workers' compensation. The overall premium has risen by approximately $310,000 compared to the previous year, largely attributed to substantial property losses from a recent fire and increased claims as employees returned to work post-COVID.

Stocks noted that property insurance rates have surged statewide in North Carolina, while workers' compensation costs have also escalated due to large claims recorded in recent years. He emphasized the importance of renewing the policies despite the rising costs, as they provide essential coverage for the district.

Board members raised concerns about the adequacy of the current insurance portfolio, particularly regarding cybersecurity coverage in light of evolving technology and the introduction of artificial intelligence. Stocks acknowledged the need for robust cybersecurity measures and indicated that the current insurance provider requires thorough documentation of security protocols to maintain coverage.

The board also inquired about the frequency of obtaining competitive quotes from other insurance vendors. Stocks confirmed that Surrey Insurance, the largest public insurance provider in the state, goes to market annually to ensure competitive pricing. He mentioned that they received multiple quotes for workers' compensation this year, with the selected quote being the most favorable among them.

Overall, the meeting underscored the challenges faced by the district in managing rising insurance costs while ensuring adequate coverage in an increasingly complex risk environment. The board expressed a desire to revisit discussions on insurance options earlier in the next cycle to better prepare for future renewals.