In an unprecedented move for Mississippi, two self-insured funds have joined forces to create a stronger fund for member companies.
On January 1, the Mississippi Trucking Association’s Self Insurers Fund merged with the Food and Fuel Self Insurers Fund. The merger brings together members of the Mississippi Trucking Association (MTA), the Mississippi Petroleum Marketers and Convenience Stores Association and the Mississippi Propane Association.
Their new fund is called the Mississippi Truck, Food and Fuel Self Insurers Fund (MTFF SIF) and will provide workers’ compensation coverage to members in the following industries: trucking, gas and butane haulers, service stations, convenience stores and attached food outlets.
“Insurance is like many other commodities, the larger the better,” said Jerry Wilkerson, executive director of the Petroleum Marketers and Convenience Stores and the Propane associations. “The larger the group, the stronger the fund will be.”
The new fund has about 80 member companies — approximately 55 from the MTA and approximately 25 from the other two associations. MTFF SIF now covers between 1,500 and 3,000 lives.
Both the Trucking Association’s fund and the Food and Fuel fund were founded in the early 1990s during a turbulent time in the insurance industry. Mississippi companies with more than five employees must carry workers’ comp, but during this crisis “about the only place they could go was assigned risk,” said Dean Cotten, administrator of the new fund. “A few could get into the standard market.”
Self-insured funds came to the rescue of some organizations like the MTA, whose members could group together and use their premiums to pay each other’s claims. Members also get the benefit of dividends because money left over after claims and operating expenses are paid is returned to members. To date, the MTA has paid out $6.2 million to members.
The MTA has around 300 member companies that include trucking-related businesses. The fund has remained steady over the years, said Cotten. The Food and Fuel Fund, however, was discontinued after approximately five years when the insurance market improved and members could get insurance elsewhere. The fund was started again, however, at the request of members who wanted back in. The Petroleum Marketers and Convenience Stores Association has approximately 150 member companies that represent about 1,000 convenience stores. The Mississippi Propane Association has approximately 100 member companies.
Wilkerson and Cotten tossed around the idea of joining forces but relied on six months of extensive research to see if it was a good fit.
“This was an unprecedented move to make the merger,” said Cotten. “These funds are not that old. We had to make sure that actuarially this was a sound move for both funds.”
Three actuarial studies and two independent audits later, the associations were ready to make an application to the Mississippi Workers’ Compensation Commission, which gave the groups its blessing.
Crosby-based Buffalo Services Inc. distributes Chevron, Texaco and Shell and operates a chain of convenience stores throughout Southwest Mississippi. The company was a member of the original Food and Fuel Fund, but switched over to the MTA’s fund after the Food and Fuel Fund was halted. Buffalo Services employees are now covered under the new fund.
“I would urge any petroleum marketer or convenience store owner to consider looking at this fund,” said Buffalo Services owner Clifton Van Cleave, who is also president of the Mississippi Petroleum Marketers and Convenience Stores.
Wilkerson said the merger gave his members the opportunity to become affiliated with a strong fund, and he believes their combined strength will draw new members. “It gives everybody a higher comfort level,” he said.
Serving on the new fund’s board are: chairman, Bernard Tucker, L.E. Tucker & Sons; Cowboy Threkheld, LMT Trucking; Todd Bates, J & B Services; David Allen Lence, Diesel Express; John Goodman, H & L Cartage; Van Cleave; Billy Millican, Royal Trucking; Barry Powell, Powell Transportation; Byran Gibson, Vortex Truck Lines; Allen McDaniel, McDaniel Hauling; Kirk Dickerson, Dickerson Petroleum; and Richard Brown, Sanders Oil Company.
The fund’s director is Cora Beth Hartfield and the fund’s director of safety is Steve Boudreaux. Hewitt Coleman, which handles underwriting and claims, handled both funds before the merger and will continue to work for the new fund.
Contact MBJ Staff Writer Kelly Ingebretsen at email@example.com.