Joint Insurance Funds

Working together to maximize efficiency.

Joint Insurance Funds, or JIFs, create tremendous value for municipal governments. The driving idea behind the strategy is to bring together local governments to accomplish three things:

1. Create the critical mass needed for self-insurance.
2. Jointly purchase the excess insurance needed to cover large claims.
3. Create the specialized administration needed to effectively manage the program.

As a result of working together, municipalities can save costs and operate more efficiently than they could on their own.

Features of Joint Insurance Funds

For over three decades, Joint Insurance Funds (JIFs) have modernized risk management for New Jersey local government.  JIFs have saved a record number of tax dollars and protected the bottom line of New Jersey’s extraordinary hometowns.

In New Jersey, the New Jersey Municipal Excess Joint Insurance Fund (NJMEL) is a hometown solution.  The NJMEL a statewide excess Joint Insurance Fund consists of 19 member JIFs that collectively cover more than 60 percent of the local governments in the state. With an annual budget of over $200 million and a statutory surplus of almost $200 million, New Jersey’s MEL system is the largest municipal property-casualty pool in the country.

By law, a JIF is a local governmental entity, not an insurance company. That means that each member appoints a commissioner, and every month some 250 mayors, council members and other local officials come together at the 19 local JIF meetings to make the decisions. Because the members have a strong sense of ownership, they apply considerable peer pressure on each other to prevent accidents and reduce costs.

JIFs affiliation with MEL has saved taxpayers almost $3 billion dollars – an unprecedented record on behalf of citizens. The MEL system is successful because it has remained under the full control of its members – an approach that puts the interest of taxpayers before any competing interest or agenda.

To learn more about JIFs, visit our affiliate, PERMA Risk Management Services.