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Item C30 BOARD OF COUNTY COMMISSIONERS AGENDA ITEM SUMMARY Meeting Date: 12/15/03 Division: Management Services Bulk Item: Yes X- No Department: Risk Management AGENDA ITEM WORDING: Approval to accept renewal proposal from Arthur J. Gallagher & Company for Airport PubUc Omcials LiabiUty insurance. ITEM BACKGROUND: Present policy expires 12/20/03. Provides coverage of $2 million per claiml$2 million aggregate. Deductible is $100,000. Policy period will be 12/20/03-12/20/04. Cost is $16,969. PREVIOUS RELEVANT BOCC ACTION: Approved current policy expiring on 12/20/03 CONTRACT/AGREEMENT CHANGES: Premium increase of $2,960. Deductible increase to $100,000 from $50,000 (premium increase would be $7,117 to remain at $50,000 deductible) STAFF RECOMMENDATIONS: Approval TOTAL COST: $16.969 BUDGETED: Yes -X- No COST TO COUNTY: $16.969 SOURCE OF FUNDS:_ad valorum REVENUE PRODUCING: Yes No X AMOUNT PER MONTH_ Year APPROVED BY: County Atty _ OMBlPurchasing _ Risk Management_ DIVISION DIRECTOR APPROVAL: j~o 1 r) ../.. - ... , .. . Ij'u <..-{' $0... CI?? /t.-f..~/L/" SHEILA A. BARKER DOCUMENTATION: Included X To Follow Not Required_ DISPOSITION: AGENDA ITEM a Revised 2/27/01 PuBUC OmClALS lIABILITY INSURANCE PROPOSAL PREPARED FOR MONROE COUNTY BOCC AIRPORT AUTHORITY COMMISSION DEcEMBER 20, 2003 - DECEMBER 20, 2004 NOVEMBER 26, 2003 SUBMITTED BY: CHUCK LOMBARDI, VP AVIATION DoUG MEYER, SR. ACCOUNT MANAGER ARTHUR J. GALLAGHER &CO. 7900 E. UNION AVENUE, SUITE 200 DENVER, CO 80237 800-333-3231 SUSAN AINSZTEIN, ACCOUNT exECUTIVE KATHY HILL, ACCOUNT MANAGER ARTHUR J. GAlLAGHER & CO. ONE BocA PLACE 2255 GLADES ROAD, SUITE 400E BocA RATON, FL 33431 561-995-6787 ARTHUR J. GALLAGHER & CO. - DENVER 7900 EAsr UNION AVENUE, SUITE 200 DENVER CO 80237-2737 (800) 333-3231 Meeting your needs. .. _ " .Exceeding your expectations MONROE COUNTY BOCC . CoNFIDENTIALITY STATEMENT We consider as confidential any information presented by Arthur J. Gallagher & Co. in our proposal, as well as subsequent verbal and written communications between our organizations, to be confidential. We ask that other brokers not have access to our material and that information presented in this proposal be shared only with those who have a need to know within your company. We make our commitment to you that information already received from you, and additional to follow, will be treated with the same high level of respect and confidentiality. ATTENTION This proposal of coverage is intended to facilitate your understanding of the insurance program we have arranged on your behalf. It is not intended to replace or supersede your insurance policies. MONROE COUNTY BOCC TABLE OF CoNTENTS INSURANCE COMPANY DESCRIPTION OF PUBUC OFFICIALS LIABIUTY COVERAGE TERMS AND CONDmONS PREMIUM SUMMARY IMPORTANT DISCLOSURES MONROE COUNTY BOCC . THE PRIMARY CARRIER .:. A.M. BEST'S RATING .:. UNITED NATIONAL INSURANCE COMPANY Policy Holder Rating Financial Category A VIII Excellent MONROE COUNTY BOCC . GUIDE TO A.M. BEST'S RAnNGs 8est's Insurance Reports, published annually by A.M. Best Company, Inc., presents comprehensive reports on the financial position, history, and transactions of insurance companies operating in the United States and Canada. Companies licensed to do business in the United States are assigned a Best's Rating which attempts to measure the comparative position of the company or association against industry averages. Best's ratings are based on analysis, which give consideration to a number of factors of varying importance. While the analysis is believed to be reliable, we cannot guarantee the accuracy of the rating or the financial stability of the insurance company. A copy of the 8est's Insurance Reporton the insurance companies is available for your review. BEST'S RATING CLASSIFlCAnONS A++ to A+ A to A- B++ to B+ Su erior Excellent Ve Good B to B- C++ to C+ C to C- Fair Mar inal Weak BEST'S FINANCIAL CLASSIFICATIONS I io to 1.000.000 II 1.000 000 to 2.000.000 III 2 000 000 to 5.000.000 IV liS 000 000 to 10000000 V 10.000.000 to 25 000 000 VI 25.000.000 to 50 000.000 VII 50.000.000 to 100.000.000 VIII ~ 100.000.000 to 250.000 000 IX ~ 250.000.000 to 500.000 000 x -i5OO.ooo,000 to 750.000 000 XI $750.000.000 to 1.000,000 000 XII $1 000.000.000 to 1.250.000 000 XIII 1250.000,000 to 1.500.000,000 XIV 1500.000.000 to 2,000 000 000 xv 2 000.000.000 to or more Note: At your option, you may wish to consult with other available rating services. Arthur J. Gallagher & Co. uses A.M. Best & CO.'s rating services to evaluate the financial condition of Insurers whose policies we propose to deliver. The rating of the carrier and the year of publication of that rating are indicated. Arthur J. Gallagher & Co. makes no representations and warranties concerning the solvency of any carrier, nor does it make any representation or warranty concerning the rating of the carrier that may change. MONROE COUNTY BOCC . NAMED INSURED MONROE CoUNTY BoARD OF CoUNTY COMMISSIONERS AIRPORT DEPARTMENT 1100 SIMONTON STREET KEY WEST, FL 33040 NOTE: Any entity not named as an insured is not covered under this policy. n-Jis includes Partnerships and Joint Ventures. MONROE COUNTY BaCC c' Puauc OFFICIALS lIABILITY LIMIT OF lIABIUYV I Loss ","",$ 2,000,000 Each Public Officials Claim LIMIT 1 ....$ 2,000,000 Each Employment Practices Claim ~4 $ 2,000,000 Annual Aggregate ~ DEDUCTIBLE ~$ 100,000 Each Claim including Loss Adjustment Expenses TERMs/CONDmONs ~ Claims-Made Form [;;0;;/ Minimum Earned Premium: Greater of $1,500 or 25% of the premium - Confirmation that General Liability Coverage will remain in force for the duration of the policy. ...,. Any pOSSible coverage for back wages is limited to $50,000 each claim with a policy period aggregate of $100,000 ~ Verification of tax exempt status .~ Employment Practice Liability included ~ Extended Reporting Period Provision · Automatic Discovery Period - 60 Days · Optional Discovery Period - Up to 3 years subject to underwriting and additional premium to be advised J Including Loss Adjustment Expenses MONROE COUNTY BOCC . PuSUC OFFICIALS LIABILITY EXCLUSIONS >UJ Prior / Pending Litigation: Prior to 12/20/2000 ~ Based on or attributable to the insured gaining profit, advantage or remuneration. ,..,. Fraud, dishonest or criminal acts ~ Willful violation of any federal, state or local statute, ordinance or regulation 6M Damages arising out of bodily injury, sickness, emotional distress, humiliation, disease or death, or property damage, diminution of value or loss of use. Does not apply to emotional distress, mental anguish or humiliation relative to employment practices liability. ....... Acts falling under the definition of Personal Injury. With the exception of assault and battery, this exclusion does not apply to employment practices liability. - Arising out of the activities of any law enforcement agency or personnel. ~ Strikes riots or civil commotion. ,,,,.;, Obligations arising out of ERISA Act of 1974 including subsequent amendments or any similar federal, state or local regulations including the administration of any employee benefit plan or self insurance fund. ""'" Any claim seeking relief other than compensatory damages. However, subject to the terms and conditions of the policy, company will defend claims seeking non-monetary relief relative to employment practices liability. ,ioEi Damages arising out of principles of eminent domain, adverse possession etc. .,;,.;, Arising from any complaint or enforcement action by a governmental agency. ~ Future wages, overtime or similar claims even if designated as liquidated damages, claims or MONROE COUNTY BOCC . PuBLIC OFFICIALS lIABILITY suits. EXCLUSIONS (coNnNuED ) _ Pollution .- Lead ~ Asbestos .- Nuclear '...... Directly or indirectly arising out of debt financing including but not limited to bonds notes debentures and guarantees of debt.; or the formulation of tax rates, the collection of taxes and or the distribution of tax refunds. ~ Arising from procurement, service, construction, or architect or engineer contracts. ..... Based on failure of the insured to purchase or maintain insurance. ~ Date Recognition Exclusion ~ Absolute Terrorism and War Exclusion Endorsements ~ Indoor Air Quality Exclusion ;.E< Punitive Damages NOTE: Not all exclusions are shown. It will be necessary to refer to the actual policy for coverage, conditions, provisions and limitations. MONROE COUNTY BOCC . PREMIUM SUMMARY COVERAGE 2002 - 2003 2003 - 2004 Public Officials Liability $ 13,724 $ 16,684 Surplus Lines Fees and Taxes $ Exempt $ Exempt Policy Fee $ 35 $ 35 Company Policy Fee $ 250 $ 250 TOTAL $ 14,009 $ 16,969 OPTION Add TRIA (Terrorism Coverage) $3,973 Additional Same coverage with $50,000 deductible $21,126 Annual Premium QUOTAnON SUBJECT To 1. EVERGREEN LETTER OF CREDIT EQUAL TO THE $100,000 DEDUCTIBLE 2. VERIFICAnON OF TAX EXEMPT STATUS. 3. PREMIUM DUE UPON RECEIPT OF INVOICE (AT BINDING) 4. RECEIPT OF AUDITED FINANCIAL STATEMENT MONROE COUNTY BaCC . IMPORTANT DISCLOSURES MONROE COUNTY BOCC . IMPORTANT DISClOSURES The proposal is an outline of the coverages proposed by the insurers, based on the information provided by your company. It does not include all the terms, coverages, exclusions, limitations, or conditions of the actual contract language. The policies themselves must be read for those details. Policy forms for your reference will be made available upon request. In addition to the fees and/or commissions retained by Arthur J. Gallagher & Co., it is understood and agreed that other parties, such as excess and surplus lines brokers, wholesalers, reinsurance intermediaries, underwriting managers, and similar parties, some of which may be owned in whole or in part by Arthur J. Gallagher & Co. 's corporate parent, may earn and retain usual and customary commissions and/or fees in the course of providing insurance products. Any such fees and/or commissions will be the responsibility of client and not Arthur J. Gallagher & Co. The information contained in this proposal is based on the historical loss experience and exposures provided to Arthur J. Gallagher & Co. This proposal is not an actuarial study. Should you wish to have this proposal reviewed by an independent actuary, we will be pleased to provide you with a listing of actuaries for your use. Gallagher from time to time enters into arrangements with certain insurance carriers or those carriers' reinsurers providing for compensation, in addition to commissions, to be paid by such carriers or reinsurers to Gallagher or its affiliates based on, among other things, the volume of premium and/or underwriting profitability of the insurance coverages written through Gallagher by such carriers or reinsurers. In addition, Gallagher and its affiliates provide management and other services to, and receive compensation for those services from; certain reinsurers that reinsure insurance coverages written through Gallagher by other insurance carriers. The insurance coverages your purChase through Gallagher might be issued by an insurance carrier or reinsured by a reinsurer that has such a relationship with Gallagher or its affiliates. MONROE COUNTY BaCC . CHANGES AND DEVELOPMENTS It is important that we be advised of any changes in your operations that may have a bearing on the validity and/or adequacy of your insurance. The types of changes that concern us include, but are not limited to, those listed below: 1. Changes in any operations. 2. Mergers and/or acquisition of new operations. 3. Any newly assumed contractual liability, granting of indemnities, or hold harmless agreements. 4. Circumstances which may require an increased liability insurance limits. Your insurance program will only be as good as the communications maintained between you and your insurance broker. MONROE COUNTY BaCC . CUENT AUTHORIZAnON TO BIND CoVERAGE After careful consideration of your proposal dated November 26, 2003, we accept your insurance program subject to the following exceptions/changes: EXCEPnONS It is understood this proposal provides only a summary of the details; the policies will contain the actual coverages. We confirm the values, schedules, and other data contained in the proposal are from our records and acknowledge it is our responsibility to see that they are maintained accurately. Please provide us with a binder(s) and invoice(s) for the coverages agreed upon at your earliest convenience. Agent Signature Client Signature Dated Dated MONROE COUNTY ATTORNEY ~~ORM ROB AT . WOLFE D~~IEi~ISTA~T C~~TTORN_~~.