January is a busy month for MTM Management. Nearly half of all MTM members have policies that renew in January. Also in January the MTM Accounting people are busy working with our outside actuary to close and determine the results for 2018. In 2018 we had two fatalities. In an average year our members have two amputations. That’s what it was in 2017, and in 2018 we had seven amputations. During the year, these results were concerning, and we asked the MTM loss control staff to give more focus to this area with our members. Not only do these severe accidents have a dramatic impact on the worker and their families, but it also is hugely disruptive to the shop and the remaining staff. Loss Control people, as they visit you, will be paying special attention to lock out/tag out procedures and electrical connections.

With this increase in severity drawing our focus, we found some good news, too. The good news is that the average frequency of normal accidents was less. That is some of the increase in severity is offset by reduction in normal accidents. So with a drumroll, in February management recommended and the MTM Board committees and the MTM Board approved a $4.5 million dividend to MTM members. This equals 25% of the current premium. This is also the fifth year in a row where member dividends have been paid. Like past years, the dividend is made up of parts. Part one is a $1.6 million loyalty dividend, which is split amongst all MTM members.

A second dividend of $2.4 million goes to those members who for a three-year period had a loss ratio that beat the MTM loss ratio. That is we wanted to give an extra dividend to those members who made the dividend possible. Even though these are two separate dividends, they are cut in one check.

This year a third dividend has been added, and it amounts to about $500,000. We did notice that newer members had smaller dividends, because they haven’t built up their premium as much as long-term members. We used all of the premium while a member was an MTM insured to determine the allocation of the dividend. This gives some small dividends to members who have only been with us a year or two. By having a third dividend of $500,000, we established a minimum dividend, so that all MTM members get a significant jump start in the MTM member dividend process.

Once the Board approved the dividend resolution, the MTM accounting department started printing the checks. Printing the checks occurred the last week of February, and the next day the marketing department started the trip planning and sorting period. So, like the last five years, we would be making surprise check deliveries (including our standard request for a picture). The delivery process of over 800 checks takes us about three weeks. Occasionally, the weather can slow us down a day or two, but we do our best to be on the road every single day. Ruth Kiefer, Chris Demeter, and Travis Halsted in Loss Control, as well as Megan Brown and I will be seeing you soon. The management team, on behalf of the Board of Directors, is delighted to deliver the member benefit checks to you, our owners.