HEMIC to return $5 million to qualifying policyholders this year

Hawai‘i Employers’ Mutual Insurance Company Inc., also known as HEMIC, will return $5 million to qualifying policyholders this year, the 20th consecutive annual dividend declared by the board of the state’s largest workers’ compensation insurer, according to an announcement.

This payout matches the largest dividend in the company’s history, and it is the third consecutive year at that amount, HEMIC reported.

“It brings the total HEMIC has returned to Hawai‘i policyholders to more than $63 million since the company issued its first dividend in 2007. More than 80 percent of HEMIC policyholders qualified this year and are expected to receive their dividend in mid-October,” the announcement says.

Company executives attribute the dividend to several factors, led by HEMIC’s partnership with policyholders to build a culture of safety among their employees and maintain safer workplaces through training, safety programs and injury prevention. Within HEMIC, technical expertise and diligence in claim management and mitigation help contain claim costs and support policyholder performance. The dividend is further enabled by the company’s financial strength and surplus.

“As a mutual insurance company, our success is shared with our policyholders who help keep Hawaii safe. This dividend is a testament to the partnership we have with our customers and their agents, to the technical expertise our service teams provide, and to a shared commitment to safer workplaces,” said HEMIC Chief Executive Officer Martin Welch. “It is not a gift. It is a return on the safety efforts of our policyholders and on the trust they place in us to financially protect them. This shared commitment is what sets HEMIC apart in the marketplace.”

As a mutual insurance company, HEMIC is owned by its policyholders, not outside shareholders. Mutual insurers can return a portion of favorable results to their policyholders in the form of dividends. HEMIC’s Board of Directors, which is comprised of policyholders elected by the company’s membership, has declared a dividend in each of the last 20 years.

To qualify, policyholders must be insured with HEMIC for more than one consecutive policy term and demonstrate a history of strong workplace safety.

HEMIC President and Chief Financial Officer Jason Yoshimi said the board weighs the company’s future claim obligations before considering any return to policyholders. Workers’ compensation coverage carries obligations that extend well beyond a single policy year, and the company manages its reserves and surplus to meet them.

“We will have obligations to our policyholders and their injured workers that extend years into the future, and we are prepared to meet every one of them,” Yoshimi said. “We meet the State of Hawai‘i’s requirements, and through a conservative, disciplined and diversified capital management strategy we hold steadfast to our obligation to deliver on our commitments. As long as there is business in Hawai‘i, HEMIC will be here to serve and support employers and their workers.”

This year’s dividend arrives as Hawai‘i employers absorb rising operating costs and a slower growth outlook. Welch added thatthe board treats the program as a standing commitment rather than a response to conditions in any single year.

“Twenty consecutive dividends are not a series of good years. They are a long-term commitment to share our success with our policyholders when they have earned it,” Welch said. “Hawai‘i is our home, our policyholders are our owners, and the kuleana we carry for this place shapes every decision we make.”

HEMIC insures nearly 7,000 businesses and more than 75,000 workers across the Hawaiian Islands and is rated “A” (Excellent) for financial strength by AM Best. The company provides safety and risk management consulting, claims management, nurse triage, return-to-work support, and additional services to every policyholder at no added cost and regardless of account size, rather than as separately priced add-ons.

While the law does not allow any insurance company to guarantee future dividends, HEMIC’s board of directors holds the dividend as an important goal and a reflection of continued commitment by HEMIC to its policyholders.

Policyholders with questions may contact HEMIC’s Underwriting Department.