PROGRAM PARTS
ATTIC is a corporation existing under the laws of the State of Montana. The shareholders are the individual trucking company insureds. Share ownership differs depending upon the premium size of the trucking company. No one trucking company can control the operation of ATTIC. Each shareholder is required to execute a subscription agreement creating their obligation to become an insured within ATTIC and establishing their capitalization requirement. In addition, each shareholder is required to execute a counterpart of the shareholders agreement setting forth their rights and obligations as a shareholder in ATTIC.
ATTIC has adopted corporate bylaws which establish a governing board of directors. The board of directors is elected by the shareholders, with each shareholder having one vote per board vacancy. The chief executive officer serves on the board along with no fewer than four other directors and as many as eight. The board is served by an audit committee, a membership committee, a reserve committee and an investment committee.
ATTIC will insure auto liability with per occurrence limits of $5,000,000, cargo liability with per occurrence limits of $500,000 and general liability with $1,000,000 per occurrence and $2,000,000 in the aggregate. Each member/insured will maintain a deductible level of at least $25,000 per occurrence and as high as $250,000. ATTIC itself will retain the loss and loss adjustment expense of every claim below $500,000 (less the insured's deductible) and will reinsure the remaining $4,500,000.
ATTIC is capitalized by the member/insureds at a rate of two to one - premium to capital. Each member/insured's required capitalization is one half of the annual premium costs associated with the expected loss, loss adjustment expense, and underwriting expenses to ATTIC in providing the first $500,000 in coverage (with a credit for the deductible level maintained by the member insured). This is referred to as the "ATTIC Layer." The annual premium associated with the reinsure program is excluded in the determination of a member/insured's capitalization requirement. For example, if ABC Trucking Company has an annual premium of $300,000 for the ATTIC Layer, its capitalization requirement is $150,000. This is the member/insured's investment in ATTIC and results in shareholder status. The capitalization requirement is a one-time investment in ATTIC to create the required regulatory capitalization and the equity necessary to secure the long-term stability of ATTIC.
ATTIC is a deductible program providing its members with several options in size of deductible and type of deductible. Rates can be developed for a deductible program of $25K, $50K, $100K, $150K, $250K $350K or $500K per occurrence and either by coverage line or as a basket deductible.
ATTIC does not require a member to collateralize its deductible program until such time as the members' reserved claims exceed their capitalization.
The foundation and ultimate success of ATTIC is the selectivity of its membership which is based on the strength of its Fleet Safety Standards and Rating System ("FSSRS"). The FSSRS will provide a benchmark for trucking companies seeking membership in ATTIC and create a rating system to be used to regularly audit the performance of trucking company members. The FSSRS will provide a numerical score to safety management controls within a trucking company that will provide a basis for membership qualification and create goals for improvement by member companies. Recommendations will be made in areas identified as "immediate improvement" or "needs improvement" and the rating system will provide a benchmark to measure such improvement.
FSSRS divides fleet safety standards and rating into thirty categories in the following six major areas of fleet safety operation: New Driver Qualification, New Driver Training and Orientation, Safety Program, Driver Compliance, Equipment Maintenance Program, and Independent Contractor Program.
Each category has an established rating analysis with corresponding assigned numerical values from one to five. Upon review (or audit), the evaluator will assign a value in each category. Each value corresponds to rating from "immediate improvement" to "best practice" (a score of 1 to 5). In addition, the evaluator will set forth recommendations in areas identified as "immediate improvement" or "improvement needed" and will establish a time line for such improvement. For example, if a trucking company receives a "2" score in motor vehicle record standards under New Driver Qualification, this represents a "needs improvement" rating in this category. The evaluator will provide a written recommendation to the company with a time line to establish the improvement. At the conclusion of the time for improvement, the evaluator will re-evaluate the company in this category and measure the improvement.
The stronger the carrier's management controls in each category, the higher the numerical score. A total score is then achieved based on the controls in place for the company's fleet safety program. A minimum score of 67% (of the total applicable categories) must be met to be considered for membership and in order to maintain membership within ATTIC. A trucking company applying for membership within ATTIC will not be considered for membership if the minimum FSSRS score is not met. Any member dropping below the minimum FSSRS score will face penalties and be required to bring their fleet safety program within compliance under established time frames. Failure to do so may result in expulsion from membership within ATTIC. A total score of all applicable categories will be compiled and appears on the final summary of the review or audit. The FSSRS is monitored by the Membership Committee of the Board of Directors of ATTIC.
In meeting ATTIC's mission to provide superior claims management to its member/owners, ATTIC has established a claims management structure and legal defense panel designed to provide proactive response to claims with timely communication to and involvement with the member/owner having the claim. ATTIC's claims management structure and defense panel consists of the following components: (1) internal organizational management structure, (2) structured relationship with national claims management service provider, (3) claims reporting and handling protocol, (4) nationwide legal defense panel, and (5) legal defense panel protocol.
All claims reported to ATTIC that meet the ATTIC claims handling criteria established in the Claims Reporting and Handling Protocol will be handled by ATTIC within its established management structure. The CEO will supervise the claims handling structure. Under the CEO will be the Senor Claims Manager with the responsibility to manage the handling of each claim. The Senior Claims Manager will manage the day-to-day claims management and report to the CEO.
ATTIC has adopted a Claims Reporting and Handling Protocol that is followed by its insureds and governs the management of claims by ATTIC and the Claims Management Service Provider. In addition, ATTIC has assembled a nationwide panel of trucking collision defense attorneys that meet the following qualifications: