1. Yellowstone Insurance Exchange, RRG
Annual Subscribers Meeting
Annual Update
July 10th, 2007
Coeur d’Alene, Idaho

2. Agenda Welcome 8:45am – 9:45am Risk Management Presentations
Managing in a Crisis
S. Yockey, Gritman Medical Center
National Trends in the Marketplace
Stephen Hill, Aspen Re, London, UK

3. Agenda 10:00am – 12:00pm 12:00 pm Box Lunch
Yellowstone Insurance Exchange, RRG Annual Meeting of Subscribers
SAC Meeting
12:00 pm Box Lunch
1:00 pm Golf at Resort Course
6:30 pm Reception and Dinner (Idaho Room)

4. Financials Revenue: Net Income: 2005 $2.62m 2006 $3.82m
2007 (May) $3.92m
Net Income:
2005 $88k
2006 $182k
2007 (May) $775.6k

5. Financials Assets Subscriber Savings Account Distribution
2005 $ 11.8m
2006 $16.7m
2007 (May) $26.0m
Subscriber Savings Account Distribution
$107k
$189k
Three Largest Liabilities
2005 $7.7m
2006 $11.6m
2007 (May) $15.5m
losses and loss adjustment expense, reinsurance premium payable and accrued expenses

6. Asset Allocation

7. Yellowstone Insurance Exchange RRG - June 2007
Fixed Income Diversification June
Sector
Rating
Yellowstone Insurance Exchange RRG - June 2007

8. Performance Summary – May 2007
*Inception date = 10/1/2005

9. Benchmarks – Average 15 Leading P&C Companies
Assets to Liabilities
YIE = $177.00
Average = $164.37
Surplus to Loss Reserves
YIE = $149.41
Average = $119.15

10. Benchmarks – Average 15 Leading P&C Companies
Surplus to Net Premiums Written:
YIE = $136.53
Average = $112.73
Top 15 – Allstate, American Family Mutual, American Home, CNA, Farmers, Federal Insurance Company, Government Employees Ins., Liberty Mutual, National Union Fire Ins. (AIG), Nationwide, Progressive, State Farm, State Farm Mutual, USAA and Zurich

11. Underwriting – 2007 Renewal
Feedback From January Survey
Exposure Definitions helped but slowed the process
We are moving the underwriting process in-house
Dedicated to Yellowstone
Earlier Renewal
Faster Physician information
Changes you request
Will take effect 3rd quarter

12. Underwriting – 2008 Renewal
Members Receive Hospital and Excess App by 09/01/07
List of Insured's
COI holders
List of physicians
List of Mid Level
Mid Level & Physicians with Tail
Physician Renewal app sent every other year – Not 2008 renewal
Mid Level renewal app every 3 years – Not 2008

13. Underwriting Pricing: For 2007 - On Target
2008 Study under development
Projected rate increase
Pricing Dependent on Claims incurred and Reserve Study

14. Risk Management Goals for 2007 Increase visits to membership
Establish a Video Library
Regional Meetings to Improve Interaction with Members
Action Plan Compliance
Improve - Yellowstone Event System

15. Risk Management

16. Total 2006 Occurrences (6/19/07)
Risk Management
Total 2006 Occurrences (6/19/07)
Total Occurrence Entered for 2006 totaled: 5,645
Top Five Issues:
FALLS (1,398 – 25%)
MEDICATION (1,397 – 25%)
OTHER EVENTS (1,332 – 24%)
BEHAVIOR (811 – 14.3%)
TREATMENT/PROCEDURE (267– 5%)

17. Risk Management

18. Risk Management For 2008: Continue Action Plan Compliance
Expand Yellowstone Event System
Develop Additional “Packets for Information”

19. Reported Incidents & Claims:
We currently have 48 open Risk Management files and 140 closed Risk Management files.
We currently have 17 open claims and 25 closed claim files.
The breakdown of open claims is as follows:
16 professional liability claims
1 general liability claim.
6 of these are in active litigation

20. Claims 17 Open Claims 2006 - 22 open 2005 - 10 open 25 Closed Claims
Montana
Idaho – 4
Wyoming – 0
NM - 1
open
open
25 Closed Claims
Montana
Idaho – 5
Wyoming – 4
NM - 0
2006 Closed Claims -4
Montana - 3
Wyoming - 1

21. Claims Larger Awards Payments in 2007 Trouble Spots $250K (MT) - 2006
Record Keeping – Documentations
Chain of Command
Privileges
Get the right person for job / community

22. Claims Litigation Expense Increases as the Claim Matures
Part of our Long – Term Strategy
Necessary Expense given the Alternatives

23. CMC Insurance Agency was formed in 2007 to provide additional insurance products that support the core products offered by Yellowstone Insurance Exchange, RRG. 
 The ultimate goal of CMC insurance is to provide one-stop shopping for insurance exchange and association members.

24. In creating CMC Insurance, the goals were to:
Create stronger insurance products that generate overall cost savings for association members
Provide a wider product line and stabilize pricing
Increase retention of membership and generate additional revenue for association equity holders
Control the quality of service partners

25. The agency brings together considerable insurance industry experience to provide a complete range of insurance products designed to complement the core products of Yellowstone Insurance Exchange, RRG.
Product focus
Employment Practices Liability
Physician & ER Physician Liability
Directors & Officers Liability

26. The agency is focused on the specialized insurance and risk management needs of hospitals and health care related organizations.
The agency has a firm commitment to provide the best possible service utilizing a range of insurance products developed for the health care industry from leading insurance organizations here in the United States and in London.

27. YIE - Key Success Factors
Strong member capitalization
Long term commitment
Stable growth - Control
Small to Midsize markets
No “Drift” from core competency
Past insurance cycles

28. YIE Goals: Lower the overall exposure and market swings
Generate cost savings for your hospital in dividends
Install quality Risk Management Programs
Experience based underwriting critical to success

29. Yellowstone Insurance Exchange, RRG
Communications
Forms
Contacts
Applications
Newsletters
Company Information

30. Yellowstone Insurance Exchange, RRG
Questions