Gas Utilities Alliance
What is the Gas Utilities Alliance?
The GUA is a group of both municipally and investor-owned natural gas utilities organized for the purpose of operating and maintaining a cooperative program of self-insurance and risk management. The GUA also provides a forum for the discussion, study, development, train-ing and implementation of risk management procedures of mutual benefit in risk management programs for natural gas utility operations. It does not make profits and exists solely for the benefit of its members. It is NOT an insurance company. Risk management and claims prevention are based upon strict compliance with the Mini-mum Federal Pipeline Safety Standards.
In 1976, small natural gas distribution systems experienced dramatic increases in their liability insurance premiums. Meetings were held with interested parties, and the Gas Utilities Alliance became a reality in 1978, providing first-dollar liability coverage.
Objectives of the GUA include saving money and providing coverage for members regardless of their size. It has effectively reduced the cost of liability coverage through stringent safety and risk management programs.
- By complying with federal and state pipeline safety guidelines and engineering standards.
- By receiving a favorable safety recommendation following a Gas Utilities Alliance engineer’s initial inspection.
- By agreeing to adhere to the rules and by-laws of the GUA.
- By executing the Intergovernmental Cooperation Agreement that specifies annual payment of dues for participation in the Gas Utilities Alliance.
- Through final approval and acceptance by a majority vote of the Operations Committee and ratification by the Risk Management Board.
- Reduced cost of gas liability coverage through effective loss control practices.
- Increased limits of liability coverage not ordinarily affordable for small gas systems.
- Reduced cost of claims through internal control and immediate investigation of all incidents, claims, and accidents by professional gas engineers.
- Alliance members are not subject to the sudden rate fluctuations of the insurance industry. Also, there is no arbitrary cancelation of membership or related coverage.
- The GUA is currently fully self-insured for $5 million. Excess coverage over $5 million is also currently in effect. In 2018, the excess coverage was $11 million, making a total of $16 million in liability coverage.
- Reduced chances of severity and frequency of losses within the group through comprehensive loss control activities tailored specifically for member utilities and the types of facilities they operate.
You do. The GUA is governed by the Risk Management Board, which includes a representative from each member system. The officers include a President, Vice President, Treasurer, and Secretary, all of whom are elected through member’s Designated Representatives at the Annual Meeting in June of each year.
The Operations Committee is comprised of nine (9) board members and was formed to handle the day-to-day administration, including overall operations, engineering claims coordination, and risk management. Membership of the committee is distributed by size and type -- from the smallest to largest members.
No. While municipal gas utilities from any state may apply, only those who adhere to strict safety and engineering criteria are accepted. Compliance is confirmed through a detailed pre-acceptance and on-site inspection conducted by GUA engineers.
- Adopt and execute necessary agreements and forward fees for the Initial Engineering Inspection.
- Appoint a Designated Representative and Alternate Representative to the Risk Management Board.
- Attend Annual Meetings (through a representative) and have operating employees in attendance at training sessions conducted by the GUA.
- Provide the GUA with data when requested.
- Establish and maintain an approved pipeline safety program.
- Pay annual membership dues.
- Abide by all By-Laws, rules, and regulations as set by the Risk Management Board and Operations Committee. This includes the formal training of all gas employees.
