risk management assessment
What is the RMA?
The RMA is an annual fee that is paid to the General Fraternity. Each chapter is billed a per member fee each semester. The base fee for each chapter/associate chapter is $150. There are three categories that the RMA is based off of: Housing, Claims and Incident History, and Operating Expectations. Depending upon how a chapter rates in each of these categories depends on whether it pays more or less per semester.
Chapters pay an RMA each spring and fall, based on the number of members in the chapter. This is multiplied by a chapter rate, which covers the chapter’s individual percentage of the insurance premium and deductible, plus a percentage of the costs tied to investigating incidents, claims mitigation and the provision of health & wellness programs.
What does the RMA pay for?
The General Fraternity collects the RMA payment twice a year and then remits them to the insurer, as, like most businesses, it does not have sufficient reserves to prepay. Insurance premiums cannot be missed, and if they are not paid, both the General Fraternity and each individual chapter could lose its insurance coverage. It will be next to impossible to get this insurance coverage reinstated given the current environment. Without such insurance, the fraternity would cease to exist, both now and in the future.
The RMA is a pass-through expense, meaning the organization does not profit off the money collected, but uses it to directly pay related expenses. The Office of Administration understands the economic pressures that everyone is feeling currently. Since 2018, the General Fraternity has not increased the chapter base rate, Associate Member fees, Initiation fees, or membership dues. In the coming year, the organization will again hold these fees constant to keep membership in Lambda Chi Alpha accessible to college-aged men.
What Facilities can be inspected by james R. Favor?
Chapter facilities are required to be inspected by our insurance company, James R. Favor once every three years. “Houses” and “Lodges” that are owned and operated by Housing Corporations will fall under this need for inspection. “Rental” and University” facilities are not inspected as the chapter does not have jurisdiction over any required updates to the facility. It is crucial you update your housing status with the Office of Administration to ensure your billing is accurate.
How is a "rental" defined?
There are a variety of elements that define a “Rental” for a chapter’s RMA. If the chapter operates in a facility that is where a majority of its events are held, the chapter’s property is regularly stored at the facility, or the chapter has the facility registered with its host university, then it is considered a “Rental.”
What is new for the RMA?
As of Fall 2023, the following has been updated for the RMA:
• At the April 2023 meeting, the Grand High Zeta approved a Risk Management Assessment (RMA) base rate increase to $150 per member per semester. While cost increases are never easy, there are several reasons why this increase is necessary:
- Insurance costs have increased significantly across all fraternities. Lambda Chi Alpha has not been immune to this.
- The Fraternity has had to pay hundreds of thousands of dollars in unanticipated claims due to recent lawsuits that resulted from chapter and member conduct issues.
- The Fraternity must maintain adequate claims reserves to retain insurance coverage and to be able to protect the organization against future claims.
• In addition, charges for Claims, Incidents, and Housing have increased to reflect the overall cost and risk to the General Fraternity.
- Claims and Incidents pose the greatest threat to insurance premiums, reflecting a need for the General Fraternity to elevate the financial cost of these occurrences.
- Fraternity facilities have been shown to increase risk and likelihood of incident for a chapter and the General Fraternity has not increased this charge proportionately. This was the most equitable way to assess chapters for the risk associated with these facilities.
Who do I contact if I have any questions?
Please contact your Chapter Support Specialist or email email@example.com for all issues or questions regarding the RMA.