Mutual Success is Fewer Injuries and Growing Dividends

SHARED SUCCESS
As we conclude the celebration of our 25th anniversary, we’d like to share our story of the mutual success of our company and our policyholders—it’s a story of shared risks and welcomed rewards.

MEMIC, which stands for Maine Employers’ Mutual Insurance Company, specializes in workers’ compensation insurance that protects both employees and employers when a worker is injured on the job. Workers’ compensation insurance pays for medical bills and replaces a portion of the lost wages for injured workers while they regain their health and return to work. Since MEMIC’s inception in 1993, we have paid more than $2.3 billion to support injured workers and pay for their medical care. But that’s just part of the story.

HOW DOES A MUTUAL INSURANCE COMPANY WORK? 
The mutual insurance company is a classic American form, dating back to The Philadelphia Contributionship, started by none other than Benjamin Franklin and his neighbors. It is a collective approach to insurance that provides a needed service and whose profit motive, the profit motive, is for the benefit of its policyholder customers.

In our line of work, the best way to succeed is to prevent injuries and to be very good at helping injured workers get healthy and back to work. That’s why workplace safety and injury management are MEMIC’s primary mission!

Fewer injuries at our policyholder workplaces mean lower costs for workers’ compensation insurance—as well as potentially paying dividends with the savings. To help prevent workplace injuries, we’ve traveled millions of miles to change how people work. We help to re-design work to “engineer out” the risks and train people to make safety their first priority. And, of course, it’s working! Injuries in Maine have been reduced by more than 40 percent and the cost of insurance has dropped by 60 percent since we began operations. We also have a legion of people who help injured workers return to health. They do it by assuring the right care promptly, quickly settling disputes, controlling medical costs, and assuring no one takes unfair advantage of the system.

Being a mutual insurance company means our policyholders are in it together. If everyone does their part to avoid injuries and we beat the odds, MEMIC distributes some of the annual profits as dividends back to qualified policyholders. Since 1998, MEMIC has distributed more than $263 million back to employers throughout Maine. In that time, approximately 17,000 Maine employers have received a check every year. This year, MEMIC distributed a record $22 million back into the Maine economy, right where it belongs.

MEMIC Dividend and Capital Contribution Return 1998-2018

A PUBLIC PURPOSE FROM A PRIVATE COMPANY
But it wasn’t always this way in Maine. Far from it! In the early 1990s, most private insurance companies determined Maine’s laws made the state an expensive and unfair place to offer workers’ compensation insurance. One by one they turned in their licenses and the cost of insurance grew to twice the national average. Then-Governor John R. McKernan, Jr. worked with the state legislature to lead the state out of crisis with the help of a Blue Ribbon Commission that recommended the formation of MEMIC. The idea was to have all policyholders share in the risks and rewards of the new company. With the reforms to the workers’ compensation insurance system, MEMIC became a private company with a public purpose and, as they say, the rest is history.

BEST IN THE NATION
As we celebrate the end of our 25th anniversary, we are proud and grateful to have been named in 2018 “the top workers’ compensation insurance company in the U.S.” by ACORD, the global standard-setting organization for the insurance industry. We also were voted “Company of the Year” by the Maine Independent Agents Association, the capable professionals who help consumers make informed choices that protect both people and property.

We share these honors with thousands of caring Maine employers and their employees who have made workplace safety a priority as well as the many governors, legislators and regulators who have supported our award-winning approach to workers’ compensation insurance. And, we are striving every day to get just that much better so we can continue to share the profits that come from safety.

We hear all the time from our policyholders that they are proud to be a part of our company. All we can say is, the feeling is mutual!