Skip Ribbon Commands
Skip to main content
Home


Servicing Carrier Allowance

History and amounts of allowances since 1991.

The Servicing Carrier Allowance (SCA) compensates a servicing carrier for the expenses it incurs in processing residual market pool business. These expenses include: loss adjustment, general, other acquisition, taxes and assessments, and contingencies and return. Producer fees (commissions) are directly paid by the Pool, and hence, not included in the SCA. SCA's are generally payable on "collected" premium only (gross premium less uncollectible premium).
 
Effective
Percent
01/01/1991
26.00%
01/01/1992
25.00%
01/01/1993
24.40%
01/01/1994
24.10%
01/01/1995
21.40%
01/01/1996
21.50%
01/01/1997
23.79%
01/01/1998
23.79%
04/01/1999
27.70%
01/01/2000
27.70%
01/01/2001
29.41%
01/01/2002
25.73%
01/01/2003
25.46%
01/01/2004
25.61%
01/01/2005
24.29%
01/01/2006
24.29%
01/01/2007
24.65%
01/01/2008
23.14%
01/01/2009
23.91%
01/01/2010
24.04%
01/01/2011
22.97%
01/01/2012
22.97%
01/01/2013
22.97%
01/01/2014
19.63%
01/01/2015
19.63%
01/01/2016
19.63%
01/01/2017 18.69%
01/01/2018 18.69%
01/01/2019 18.69%
 
History
The ICRB Governing Board voted to disapprove a SCA of 29.2% effective 1/1/98 and continue with the 23.79% allowance since we expected to initiate a servicing carrier bid process in 1998. However, the bid was tabled during 1998 and 1999 while the ICRB considered negotiating a contract with the National Pool. The Board decided to begin the bid process in 2000 with bidder's coverage beginning 1/1/2001. At its meeting 3/2/99, the Board approved a SCA of 27.7% effective 4/1/99 as recommended by NCCI. At its meeting 9/14/99, the Board approved to continue the SCA of 27.7% through the year 2000 or until the bid took effect.

Effective 1/1/2001, the Bureau initiated a bid process and selected two carriers: Liberty Mutual and Travelers to split the market 50% each, for three years. Based on the bids, the estimated weighted average SCA is 29.41%.*

In September 2003, the Board agreed to extend the two servicing carrier contracts for one year while the ICRB pursued its research into an alternative Indiana pool arrangement. Therefore, the fee remains at 29.41% through 2004, although the ultimate weighted average SCA will vary, again due to the changes in policy count and premium volume.

Effective 1/1/2005, the Bureau initiated a bid process and selected three carriers: Liberty Mutual (40%), St Paul/Travelers (40%) and Continental Western (20%), for three years. Based on the bids, the estimated weighted average SCA is 24.29%.*

Effective 1/1/2008, the Bureau initiated a bid process and selected four carriers: Liberty Ins Corp (30%), Travelers Indemnity Co (30%), Continental Western Ins Co (20%), and Technology Ins Co (20%) for three years. Based on the bids, the estimated weighted average SCA is 23.14%.*

Effective 1/1/2011, the Bureau initiated a bid process and selected four carriers:
  • LM Insurance Corporation (Liberty Mutual Group) – 25%
  • Riverport Insurance Company (Berkley Group) – 20%
  • Technology Insurance Company (AmTrust Group) – 30%
  • Travelers Property Casualty Co Of America (Travelers Group) – 25%

Based on the bids, the estimated weighted average SCA is 22.97%.*  

 
Effective 1/1/2014, the Bureau initiated a bid process and selected four carriers:
  • LM Insurance Corporation (Liberty Mutual Group) – 30%
  • Riverport Insurance Company (Berkley Group) – 25%
  • Technology Insurance Company (AmTrust Group) – 25%
  • Travelers Property Casualty Co Of America (Travelers Group) – 20%
Based on the bids, the estimated weighted average SCA is 19.63%.*
 
Effective 1/1/2017, the Bureau initiated a bid process and selected four carriers:
  • LM Insurance Corporation (Liberty Mutual Group) – 45%
  • Accident Fund – 15%
  • Technology Insurance Company (AmTrust Group) – 10%
  • Travelers Property Casualty Co Of America (Travelers Group) – 30%
Based on the bids, the estimated weighted average SCA is 18.69%.*
* Note that the ultimate weighted average SCA will change from year to year due to the variable aspect of the policy count and premium volume. The SCA is a combination of a flat policy fee, and a percentage of final net premium collected, based upon policy count and premium volume.

 

Related Files

The material in this document has been prepared and shared for informational purposes only and should not be relied upon as legal advice on any particular situation.