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SCA set to cancel group insurance plan

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Eleven years into Springfield Contractors Association’s group insurance plan, Executive Director Sheryl Letterman and the SCA board have requested termination of the plan effective Dec. 31.

In a Sept. 21 letter sent to policy issuer Bituminous Insurance Cos., Letterman cited the insurer’s refusal to remove Springfield’s Barker-Phillips-Jackson Inc. as administrator of the SCA Safety Group Plan.

“While we expressed a clear desire to remove Barker-Phillips-Jackson from the role of plan administrator, you refused to make that change. Equally troubling is your failure to provide us with any reason for your continued insistence upon Barker-Phillips-Jackson being the plan administrator,” Letterman wrote to Christopher Demse, the St. Louis branch manager for Rock Island, Ill.-based Bituminous Insurance. “Your continued failure to address our concerns leaves us with no choice but to inform you that the Springfield Contractors Association is withdrawing our sponsorship of the SCA Safety Group Plan.”

The letter does not address why SCA insisted on the removal of Barker-Phillips-Jackson. In the letter, which was faxed by an anonymous source to Springfield Business Journal on Oct. 10 along with a Sept. 28 response from Demse, Letterman addressed previous correspondence between SCA and Bituminous.

“The Springfield Contractors Association Board of Directors was disappointed with your letters of Aug. 25 and Sept. 6. Neither of those letters addressed the concerns and questions raised in our Aug. 19 letter to you,” Letterman wrote.

When contacted by SBJ, Letterman deferred comment to SCA’s board President Rich Kramer. Kramer declined to comment on the termination of the plan, citing advice from the organization’s legal counsel.

In Demse’s Sept. 28 response, he said Bituminous would terminate the plan as requested. “We were surprised to receive your notification, given that we were still in the process of resolving the issues you highlighted in your letter of Aug. 19, 2011. It is unfortunate that you and your board would not give us more time to resolve these, as we had previously informed you of our planned review of the program to occur no later than December of 2011,” Demse said in the letter, which noted Bituminous had paid out more than $1 million in dividends to participating members since the plan’s inception 11 years ago.

Demse, who did not return multiple calls for comment, said in the letter Bituminous had been an active member of SCA’s safety committee to help minimize workplace accidents and reduce premiums.

Barker-Phillips-Jackson President and CEO Tom Montileone declined to comment, citing the strict confidence of its business relationships.

Tammy Henson, owner of Diamond-based Central Caisson, said she joined the Springfield Contractor’s Association around 2007 to take advantage of its dividend program. Her insurance provider is Bituminous Insurance, and Henson’s local agent suggested she join.

Henson said she received a letter with her last dividend check in October saying the SCA didn’t meet the minimum premium requirements set by Bituminous.

She was unfamiliar with any problems between Barker-Phillips-Jackson and SCA.

“It’s nice to get the dividend check back,” she said, adding that she has earned in excess of $10,000 in dividends since she started her membership. “I’ve been with Bituminous since 1996. Am I going to change insurance companies? No.”

Neither Department of Labor spokeswoman Amy Susan nor Department of Insurance spokesman Travis Ford had received a plan cancellation notice as of Nov. 10.[[In-content Ad]]

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