1. GENERAL SERVICES DEPARTMENT Risk Management Division Risk Management Information System Project Certification-Initiation Phase September 24, 2008

2. General Services Department Risk Management Information System EXECUTIVE SUMMARY RMIS - The one essential tool for effectively assessing and managing the location, extent and cost of loss Business Problem and Opportunity –No successful insurance entity can function without the support of a RMIS –A RMIS is the key to preserving the financial viability of the entity and limiting the cost of protection (in the form of premiums) to the entity’s customers. It provides the: Analyses of cost and cause of loss, Ability to detect and analyze emerging loss trends, Ability to proactively anticipate and prevent, or limit the damage of, emerging loss trends RMD is the custodian of self insured retention funds which addresses workers’ compensation, liability, and property premium collections and payments for incurred loss

3. General Services Department Risk Management Information System RMD Bears the Burden of Two Primary Responsibilities: 1. To preserve life and public property through the prevention of the occurrence of insurable loss 2. To mitigate the cost of incurred loss through process management of the claims adjusting and payment system Neither of these responsibilities can be achieved without the availability of a full service, state-of-the-art RMIS

4. General Services Department Risk Management Information System Risk Management Division (RMD) Service Overview Who Do We Serve –25,000 State employees –150 State Agencies –26,500 University employees –9 Universities –Public Schools and other political sub-divisions of the state (including NMSD & NMSVH) What Do We Do –Workers Compensation claims (work related injuries of public workers) –Legal Defense of State Entities –Property & Casualty Claims Including: AutosCivil Rights Crime BuildingsMedical Malpractice Fine Arts Business PropertyLaw Enforcement General Liability Liability Auto Liability

5. General Services Department Risk Management Information System The Need Defined RMD annually generates 4400 total NEW claims –FY08 total was 4453 claims (2534 Workers Comp, 1919 Liability & Property) –Historical claims totals are 112,379 (56,648 Workers Comp, 55,731 Liability & Property) –Workers Comp last year processed 36,943 automated claim payments totaling $14,357,698.00 –The annual cost of not meeting statutory requirements for timeliness of payments would total in excess of two million of dollars Enhancing RMIS capabilities is the primary tool for delivering superior customer service. Client agencies demand and deserve better service and support from RMD The Executive and Legislative Branches are requiring more detailed data, and more in depth analysis of loss trends RMD is vulnerable to loss or corruption of data due to weaknesses present in the current legacy system and end-of life hardware

6. General Services Department Risk Management Information System Benefits of Modernization Significant Cost Savings –Avoidance of $3 plus millions of dollars in fines and penalties for late claim payments and other assessed penalties –Avoidance of duplicate payments or “lost” transactions –Reduced paid loss experience through enhanced loss prevention capability Improved Customer Service –RMD will be able to provide on-line claim reporting and claim data access to client agencies. –Lower premiums will result from providing cost of loss and cause of loss data to clients for their proactive loss prevention efforts. Security and Stability –A modern system, fully supported by the vendor, will protect data integrity, guard against loss of data, and address emerging needs

7. General Services Department Risk Management Information System Governance Structure

8. General Services Department Risk Management Information System Budget by Project Phases Project Phase Release of Funding Breakdown InitiationSeptember – October, 2008 $50.0PM (526hrs*$95/hr) PlanningOctober – December, 2008 $110.0PM (632hrs*$95/hr Hardware 15.0) IV&V ($35.0 ImplementingJanuary – August, 2009 $505.0Software ($440.0) Integration ($50.0) Training ($15.0) Close-OutAugust – November, 2009 $35.0 Contingency ($35.0) Project Total $700.0

9. General Services Department Risk Management Information System IT Architecture Open Source/COTS Aligned with State’s Enterprise Architecture Rules based Authorized User Access Security Standard Operating Platforms – SQL2005, Windows 2003 Interface with SHARE and GSD/ASD Financial Systems Housed at Simms Data Center Web front-end On-line access to information

10. RMIS Architecture

11. General Services Department Risk Management Information System Requesting Approval for Project Initiation Phase and Release of Funds in the Amount of $50,000