How IPEP Works
Find our if your team is eligible for IPEP's benefits
IPEP is an alternative risk management mechanism known as an "intergovernmental pool." Intergovernmental pooling is utilized throughout the nation by many public entities. The participating public employers pay contributions (premiums in traditional insurance) to a joint fund from which claims and the operational expenses of running the pool are paid. Participants in pools include cities, towns, counties, school districts, townships, etc.
Although pools function much like insurance companies, pool members do not shift the risk of loss to the pool but share the risk with the other pool members. The pool and its members are protected from extraordinary losses through an excess insurance policy. The following are some common characteristics of risk pool.
Homogenous Membership: The pool participants are homogenous in that they are similar in their interests, work force and demographics.
Risk Management Requirements: Most pools believe it is essential to impose risk management standards to control losses for the group through education. Efforts are focused on the specific activities, exposures and losses of the members, reinforced by continuous monitoring and evaluation of the effectiveness of those efforts.
Nonprofit Status: Since pools operate on a not-for-profit basis, they can operate more efficiently than insurance companies which need to generate profits for owners and shareholders.
Accountability: Most pools base the contribution calculation partially on the members' loss experience, giving credits for good performers and debits for poor performers.
Claims Philosophy: Because pools are not concerned with profit objectives, they can pursue an aggressive claims approach when necessary; taking cases all the way to court to avoid setting unfavorable precedents.
Shared Knowledge: Knowledge gained from a claim against one member can be shared with others so that they can take measures to reduce the likelihood of a similar occurrence.
Public entity pools meet the risk financing needs of the public entities by providing:
Strong claims management
Quality risk management service
Administrative services designed for public entities