Why is a JIF Successful?
JIFs are successful due to three overarching principles:
- Structure: JIFs in the rest of the country are either local or statewide. The advantage of a local JIF is that the members have a greater sense of ownership which motivates stronger risk control. However, because of their smaller size, local JIFs are more dependent upon reinsurance. Under the MEL concept, each member joins a local JIF, and the local JIFs from around the state join together in the MEL to provide excess insurance and insure lines of coverage that are too difficult for a smaller JIF to handle. Twelve of these local JIFs are administered by PERMA and the other seven by other administrative firms. Under this unique structure, the members achieve the advantages of both local JIFs and a large statewide pool.
- Strong Reinsurance: To protect against catastrophic events, all JIFs purchase reinsurance. Because of its size and reputation for sound management, the MEL has long-term relationships with the strongest reinsurers in the business, providing members with greater peace of mind.
- Governmental Status: A JIF is a governmental entity and exempt from the taxes, fees and assessments charged by conventional insurance companies.