Lake County weighs leaving PRISM for Golden State Risk Management Authority to retain primary liability coverage

PRISM Chief Executive Officer Gina Dean told Lake County supervisors that escalating litigation costs, social inflation and changes in PRISM's program structure mean the county may soon lose the primary first-dollar liability coverage it has purchased through PRISM since 1998.

"Your liability premiums have gone up dramatically year over year, almost 20% for the last several years," Dean said during a detailed presentation on the pool's operations, cost drivers and risk-control services. She described PRISM as a member-directed risk-sharing pool that uses a captive insurance vehicle and other tools to reduce members' premium costs but said some first-dollar options are being eliminated.

PRISM presented three options for the county: transition to self‑insurance (with a first $100,000 self‑insured retention per occurrence), purchase coverage on the commercial market (which the presenters said is often unavailable or substantially more expensive), or join the Golden State Risk Management Authority (GSRMA). Scott Schimke, executive director of Golden State, told the board that GSRMA offers first-dollar coverage and in‑house claims handling, and that Lake County would be eligible to eliminate its current $10,000 deductible under that program.

Board members pressed for comparative numbers and governance details. County risk analyst Rick Inslee estimated Lake County's current cost at roughly $6,000,000. Supervisors also asked how the ARC captive invests and how governance and seats on a new JPA board would work; PRISM and Golden State presenters said the arrangements provide member input while allowing the captive (ARC) somewhat broader investment options than a California public entity could execute directly.

Following questions and discussion, the board gave consensus direction for staff to provide notice to PRISM of the county's intent to withdraw from the PRISM primary liability program and to pursue joining GSRMA, aiming to act well before the July 1 fiscal-year transition deadline. County staff will return with formal recommendations and comparative cost data before a final decision.

What happens next: staff will prepare the formal notice of withdrawal to PRISM and evaluate membership terms, projected costs, and transitional logistics for the board to consider at a future meeting prior to June 30, 2026.