Year End Closing 2022

We made it through the holidays. And Michigan winter is finally upon us. So is the closing of calendar year 2022. The MTM midyear actuarial review and subsequent monthly loss reviews are encouraging for our ninth MTM annual dividend in a row. That’s the preliminary good news. This is always a stressful time for me. We have had a good year so far, we are waiting to close the year with hopefully no large shock losses, and then we work with our actuary on the final loss numbers for the year. This year the normal year end closing stress is a bit higher. Remember that we moved the annual member’s meeting from October to early March. Traditionally at the October meeting we have given a brief synopsis of how the year looked through 9 months. It was always an estimate since there were still three months to go and large surprise losses can happen. However, this year with the annual member’s meeting in March, we won’t be giving you an estimate, but we’ll actually be giving you the year end result. As I have mentioned in an earlier newsletter, if all goes to plan we will have a great speaker, a great meal, and then hand out member dividend checks. Talk about pressure—however you can help—using your loss control skills and the MTM loss control team please do all you can to close out the holiday season with minimal losses. It’s good for your workers, it’s good for you, and it’s good for your dividend calculation.

The dividend cycle has also started administratively. On the first Thursday of December, your Board Finance Committee met to review profitability through November and then approved a $2 million preliminary dividend recommendation for the full MTM Board. The next step is for MTM management to hold that recommendation until Christmas at which time we now have a couple more weeks of data and hopefully no shock losses. We forward the Finance Committee recommendation to the MTM Board. The MTM Board makes a decision to approve that recommendation and directs management to post it on the company financial records. The $2 million is not the full dividend. It is a conservative number that we pre-declared before we know the actual profit of the year. However, by pre-declaring a $2 million dividend, we save $420,000 in taxes. That tax savings goes directly to the MTM member’s dividend fund. So by the time you get this we will hopefully have sent that recommendation to the full Board for approval and will be working with our actuary to close out the year. We are all anxious to see the 2022 result.

Hope you had a wonderful holiday and are prepared for 2023. Best wishes for our NEW Year.

• John