Kimball City Attorney and Marion County Attorney Billy Gouger

JASPER, Tenn. -- When deciding between two potential insurers for Marion County's workers' compensation and general liability coverage, county administrators said both the price and participation in an insurance pool were important considerations.

On Monday, Marion County commissioners voted unanimously to accept a bid from Patrick-Partin Insurance Inc. in South Pittsburg, Tenn., after a recommendation from the board's finance committee.

County Attorney Billy Gouger said the two viable bids from Patrick-Partin and First Volunteer Insurance in Jasper were practically identical, but Patrick-Partin had "a less expensive premium."

"The county is under no obligation under Tennessee law to accept the lowest bid," Gouger said.

Patrick-Partin participates in a statewide insurance pool, officials said, but First Volunteer does not.

Insurance companies sometimes group together and pool their assets so they can provide better coverage than individual companies, officials said.

Commissioner Tommy Thompson said participation in an insurance pool was a significant concern when deciding between the two companies.

"We went through a period of time a few years back where our insurance coverage was canceled," he said. "We had to get with this state pool to get coverage, so I feel pretty strongly that we ought to remain in that state pool."

Commissioner Jane Dawkins, who owns a private insurance company, said insurance pools can be a double-edged sword.

"Anything that is in a pool bears watching," she said. "Some of these pools have already been dumped out."

Natural disasters can cause those pools to run dry, Dawkins said.

If an insurance company is worth $10 million and it loses $15 million, Commissioner Donald Blansett said, those being covered in the pool would be assessed the remaining $5 million, causing premiums to rise.

"Pools are fine until that happens," he said.

"That pool is not a bottomless pool," Commission Chairman Les Price said. "If enough people dip into the pool, somebody's going to be short."

Ryan Lewis is based in Marion County. Contact him at ryanlewis34@gmail.com.