Insurance Trusts

Insurance Trusts

The state operates a number of insurance trusts. These operate much like private insurance companies, collecting premiums from those needing, or legally required to have, insurance and paying out claims when legally required.

The state runs several retirement systems for public employees. Most state employees are covered by the Oklahoma Public Employee Retirement System (OPERS), though there are smaller systems for law enforcement officers, wildlife employees, and judges. The state also operates three large retirement systems for local employees, specifically teachers and education staff, police officers, and firefighters. The Teachers Retirement System (OTRS) pays monthly benefits to approximately 65,000 retirees and beneficiaries, the OPERS system supports 36,000 payees and the remaining systems support an additional 17,000.

Oklahoma has made significant progress in addressing future financial difficulties with its retirement systems. The two largest systems, Teachers Retirement (OTRS) and OPERS, have seen their funded ratio – their ratio of assets to expected future costs – rise in recent year. These ratios, 72 and 99 percent respectively in 2019, have improved dramatically since 2011, up from 48 percent (OTRS) and 66 percent (OPERS).  The improved funded ratio of the retirement systems has been achieved by increasing employer and employee contributions, pushing back the retirement age for new retirees, restricting cost of living adjustments, and converting OPERS to a private sector-like defined contribution system for employees hired since 2015.  Our retirees receive lower benefits than their peers in neighboring states.

The Oklahoma Employment Security Commission operates Oklahoma’s unemployment compensation system. It collects revenues from the federal government (from a tax on wages and grants for employment and training) and a state employer tax. The agency uses these funds to pay benefits to unemployed people who qualify and to support employers and job-seekers through advertising, training, and other job-related activities. In 2019, the Employment Securities Commission paid unemployment insurance benefits totaling $221 million to 43,000 workers. At the height of the COVID-19 pandemic in May 2020, OESC paid $230 million to over 215,000 claimants in a single month.

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