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Mon February 27, 2012
Missouri audit criticizes state-created insurance firm
A report by the Missouri auditor says a state-created workers' compensation company has enjoyed a competitive advantage while functioning in a best-of-both-worlds situation.
Auditor Tom Schweich says Missouri Employers Mutual Insurance Co. has claimed a federal income tax exemption by categorizing itself as a public corporation. That has helped it accumulate a surplus of more than $160 million.
But Schweich says the Columbia-based firm essentially operates as a private entity by paying its executives a lot and taking expensive junkets. Missouri Employers Mutual also claims to be exempt from the state's open-records law.
The company issued a written response to the audit saying its employee pay and expenses are reasonable for an insurance company and it should not be compared to the public sector.