"Like many libraries, our rates have been going up each year, even with no claims. We will see significant savings by joining the LIRA pool. I hope more libraries join the pool to further our purchasing power."
—Jeannie Dilger, director of the La Grange Public Library
As libraries continue to try to maximize their collective purchasing power, they've discovered that this is not just about shared catalogs and e-books. Many public libraries already participate in health insurance pools, and ILA has been exploring the formation of a pool for member libraries to provide other types of insurance. Fifty-two libraries have submitted their requirements and received quotes, which were presented at two meetings held on October 29 and 31 at the headquarters of Arthur J. Gallagher & Co.
"ILA's leadership in this project provides a long term benefit for public libraries as we struggle to balance administrative costs with the increased demand for services and resources," said Jill Rodriguez, director of the Bensenville Community Public Library District. "The concept of a pooled, self-funded insurance program has been proven to be an effective way to contain costs and still provide adequate coverage for our libraries."
Based on past premiums and claims, the 52 libraries considering membership in the pool paid $1.4 million in premiums against an average of $127,000 in claims--that's nearly $1.25 million in insurance company profits that could be returned to libraries. Further, by buying in bulk, individual libraries will typically see both reduced costs and improved coverage immediately.
The 52 libraries are all eligible for membership based on the current quotes with a goal of forming the Libraries of Illinois Risk Agency (LIRA) by December 31, 2013. While the lead time is tight for library boards to make a decision, there's a case to be made for acting as quickly as possible. Some legislative changes in how pools are governed will take effect after the first of the year, and the premium quotes are time-sensitive.
"Like many libraries, our rates have been going up each year, even with no claims. We will see significant savings by joining the LIRA pool. I hope more libraries join the pool to further our purchasing power," said Jeannie Dilger, director of the La Grange Public Library.
- Savings over conventional insurance programs
- Broader coverage and increased limits
- More control over claims
- Premium stability
- Potential return of surplus