HomeMy WebLinkAbout1998-03-24 - AGENDA REPORTS - INSURANCE RENEWAL (2)CITY OF SANTA CLARITA
AGENDA REPORT
CONSENT CALENDAR City Manager Approval:
Item to be presented by:
Paul Zaengle
DATE: March 24, 1998
SUBJECT: INSURANCE RENEWAL
DEPARTMENT: City Manager's Office
City Council approve the expenditure of an amount not to exceed $260,484 from account
number 1600-8501 to renew the City's insurance policies, and authorize the City Manager
or designee to execute all documents, subject to City Attorney approval.
BACKGROUND
An extensive bidding process was undertaken over the past few weeks to ensure that the
City received the most coverage at the lowest possible price for its insurance policies for the
upcoming year. Proposals were solicited from the following companies which represent the
majority of insurance companies offering public entity insurance in the State of California.
Insurance Company
Municipal Mutual Insurance Co.
Signet Star
Coregis Group
TIG Insurance Co.
Genesis Insurance Co.
Lexington Insurance Co.
Royal Indemnity
Reliance Insurance Co.
Westchester Fire Insurance Co.
United Pacific Insurance Co.
Associated International Insurance Co.
Best's Rating
Financial Size
NR -2*
IV
A
IX
A
IX
A
XI
A++
VII
A++
XII
A
XII
A-
XII
A
IX
A+
XV
A
VII
* Insufficient in size and operating experience to be rated.
The effort was very successful, and the policy includes several positive, new features. The
following outlines the three components of the City's insurance, the companies selected to
provide the policies, and the premiums as compared to last year.
Q Agenda ltemIM"9-
49
YA
I. Primary General Liability and Automobile Liability: Covers the City's
liability in excess of the self insured retention of $250,000 (to a limit of $15 million).
Company: Royal Indemnity
Premium: $117,000 (decrease of $13,815 from last year's $130,815)
Royal Indemnity will allow the City to take advantage of a three-year policy that
will lock in the same annual rate during that time. The premiums will be
subject to an annual re -rating, but there would only be an increase in the event
the City's loss ratio increased dramatically. Even as property and facilities are
added, such as the Central Park, the rate would not increase.
II. Commercial Package Policy: Includes buildings, personal property, autos,
valuable records, computers, contractors equipment, tools and boiler and
machinery.
Company: Reliance Insurance Company
Premium: $138,448 (decrease of $12,177 from last year's $150,625)
III. Commercial Crime Policy: Includes employee dishonesty, forgery or alteration,
computer fraud, and theft.
Company: United Pacific Insurance Company
Premium: $5,036 (increase of $1,643 from last year's $3,393)
• The City is taking advantage of a newly approved form of bonding insurance
called a "master bond" that eliminates the need for individual bonds by
automatically bonding all City employees.
• The new policy raises the limit from $300,000 to $1 million per occurrence.
ALTERNATIVE ACTIONS
Other action as determined by Council.
FISCAL IMPACT
The total premium is $260,484, which represents a savings of $24,349, or 8.5% less than
last year. This savings was achieved even while insuring the City's new property
acquisitions worth approximately $3,156,600. Funds for this expenditure have been
budgeted in account number 1600-8501.
PEZ:insurcc.doc