Item C47
BOARD OF COUNTY COMMISSIONERS
AGENDA ITEM SUMMARY
Meeting Date: September 20-21. 2000
Bulk Item: Yes -X- No
Division: Management Services
Deparbnent: Human Resources/Risk M3IUU!ement
AGENDA ITEM WORDING: Approval to accept proposal from Florida Municipal Insurance Trust
Agreement #386 at a net annual premium of$140,929 to be paid in quarterly installments of$35,232.
First installment due on October 15, 2000.
ITEM BACKGROUND: This program provides $5,000,000 excess liability insurance over the
County's $100,000 Self-Insured Retention for General, Public Officials and Automobile Liability Claims.
Also provides auto physical damage and Ambulance Attendants Medical Malpractice Coverage. Coverage
was bid out and Florida Municipal Insurance Trust through the Florida League of Cities was the most
favorable to the County of the 4 bidders. (This represents a 7% increase over the 199912000 premium).
PREVIOUS RELEVANT BOCC ACTION: Awarded Renewal from Florida League of Cities, Inc.
9/22/99 annual premium $131,620.
STAFF RECOMMENDATION: Approval to accept proposal and pay premium.
TOTAL COST:
$140,929
BUDGETED: Yes.x No
COST TO COUNTY: $140,929
REVENUE PRODUCING: Yes No X AMOUNT PER MONTH YEAR
APPROVED BY: County Atty _ OMBlPurChasin~RiSkManagement_
DIVISION DIRECTOR APPROVAL: ~ ~ ~~
James L. Roberts
DOCUMENTATION: Included: X
To Follow: _ Not Required: _
DISPOSITION:
Agendaltem#: ~1
James L. Roberts
County Administrator
Sheila Bark~h
Human R:e~~ 'Director
Wayne Robertson
Risk Manager
-O~~rY~o~~~E
(305) 294-4641
To:
Thru:
From:
Date:
09/05/00
Subject:
(~., ---
MEMORANDUM
County General Liability Renewal
BOARD OF COUNTY COMMISSIONERS
MAYOR Shirley Freeman, District 3
Mayor Pro tem George Neugent, District 2
Nora Williams, District 4
Wilhelmina Harvey. District 1
Mary Kay Reich, District S
I am pleased to agree with Sid Webber's recommendation for the renewal of The County's General Liability
Policy with The Florida League of Cities for the 2000 - 2001 policy period. Not only is this policy less costly
than the other 3 bids received, it is more comprehensive coverage.
Thank you
09/04/2000 21:24
8132871041
INTERISK
PAGE 01
I NTERISK CORPORA TION
Consultants
1111 North Weabthcm: Boulevard
Suite 208
T_pa, FL33607-4711
Phone (813) 287-1040
F8Caimile (813) 287-1041
Risk Man~erll
Employee Benefits
September 1, 2000
Mr. Wayne Robertson
Risk Manager
Monroe County
5100 College Road, Room 205
Key West, Florida 33040
Re: 200012001/ CtuMGIty Renew'"
Dear Wayne:
Please find auacbed Interisk's evaluation report reprdiDg me County's remarkding of ita Casualty
Program. It appears as if the County will be bat serwd by nmainiDa with the Florida Leasue for
the upc:omiDg year.
Once you have had a chance to review the report, please do DDl bcsitat.e to call with any qucstioos.
Cordially.
INTERISK CORPORATION
1~o.~
CPCU. ARM
69/61/2666 61:54
8132871641
INTERISK
PAGE 63
MONROE CoUNTY, FLORIDA
2000/2001 CAsuALTY INSURANCE PROGRAM
PROPOSAL EvALUAnON
Monroe CoWlty'5 Casualty InsUD1lce Program it1cludes:
<- Premises & Operations Liability;
<- Vehicle Liability;
~ Public OfficWs Liability and
~ Employee Dishonesty.
The Florida League of Cities through the Florida Municipal Insurance T lUSt (F.MI1) is wrrmdy
providing all coverages. All policies expire on Septmlber 30, 2000. In accordance with County
purchasing procedures, rhe Program "WaS competitively madceted for the 2000/2001 policy year. The
ptOCe$s began with the development of detailed bid specifications that wele distributed to all agentS
thar expressed an interest in representing the County or that responded to the '"Public Notice"
announcing Monroe's intent of receiving competitive proposals.
In an effort to control the process and to ensure ~ proposers had unrestricted access to prospective
insurers, the agmlS were requited. to submit, ranked in Ol'det of preference, insurance companies they
wmted to utilize in str1lCt:uring their programs. Baled on !be submissions received, apntB were
granted authorization to mamet the County's program to specific mums. A total of sm (6) agents
requested a total of nineteen (19) different insurers. The companies requested represented the
majority of organizations w:illing to provide insurance to Florida governmental entities.
On August 29, 2000, an proposals received were publicly opened. A total of four (4) agents
submitted proposals. They included:
.,/ LB. Bryan & Company of Jacksonville. Florida
.,/ Marsh USA, Inc., ofFt. Lauderdale, Florida
.,/ The Florida League of Cities, of Orbndo Florida and
.,/ Arthur]. Gallagher & Co. of Boca Raton, Aorida.
The Johnson's I11surance Agency of Big Pines, Horida and Risk Management Associates of Ft.
Lauderdale, Aorida &.aed to submit a proposal as specified in the bid specifications.
All proposals r:eceived were reviewed in det:UI and the att2ched summary 'WI prepIII!d compaang
their rm;or features with the County's current program. Following is a brief discussion of each
proposal. Included in the discussion is Inrerisk's recommenda.tions on which pl'OgD111 offers the
County with the be$[ ~tion and the most competitive price.
I_R, B~ .. c;nnq,.q,y
L.B. BlY20 proposed an ((All I.ines Aggregare" insurance program &om Executm Risk. Insurance
Company. &ecutiw Risk enjoys a &voable mang from AM. Best md Company, die leading
ewJuato{ of insumnce company oper.ations.
All Lines .Aggregate insurance is a three (3) tiered program that includes Sell-Insurance, Specific
P..xcess Insunnce and i\@gmgate StOp Loss InS\U'lUlCe. Under the SeJfInsurance tier. the County
1
69/61/2666 61:54
8132871641
INTERISK
PAGE 65
It is therefore recommended chat the L.B. Bryan program be eliminated from furthu consider.ttion.
~ U.u. me.
Marsh proposed a ('Laxge Deductible" program from the Coregi& Insurance Company. Coregis
enjoys a favorable rating from the A.M. Best Company. The telmS and condition of Marsh's
program are consistent wirh the County's current program. except the Public Officials coverage
would be provided on a uQaims Made" basis. This could require the County to purchase 3D
Extended Reporting Endorsement if m Occwxence foan is purchased in the future.
In evaluatin~ Marsh's program it is impoctant to undetsllUld the diffetence between lalge Deductible
and. Self Insw:ed progmms. Un~ a Self Insured. program, me insured (the Cowu:y) retains the
responsibility fot paying claims up to lhe self insured retention ~t ($100.000). Under a Large
Deductible program, the insurer is responsible for the entire claim and must recover !he deductible
from the insured. NoanaDy a L.ge Deductible insurer retains gtea~ conuol avec the cbim pmces.
since they are contractually responsible for the entire claim. This could impact the method in which
the County CUlTeOdy handles it claims and could effect Iheir right to select defense counsel.
"The tot3l cost of Matsh's proposal was $160,106. Since this represents a lUghet' COSt to the County
thm other available proposals and since the Public QftJ.cials coverage is ptmrided on a OEs Made
basis, it is recommended that Marsh's proposal be eliminated from further consideration.
AnhUlT.. r-n~r '" Co.
Gallagher also submitted an "All Lines Aggn!g.ate" program utilizing the nG lnsuance Company-
Like the Bryan's proposal both the Public Officials and the Empl~ Benefit co~ were
proposed on a c"Oaims Made" basis. In lIddition, the Vehicle Physical Damage coveage conrained a
$100,000 self-insured retention. Under the Galbgbet prognrn the ~ Stop Loss lnsunftc:e
would not apply until the County made tot3l payments of $500,000. The proposed ptemium of
Gallaghers program was $155,000. Since this represents a IUgber cost to me County without
including the cost a6sociated with the additional cost the County would have to assume for its
Vehicle Physical Damage cbims and the cost associaccd with a potential &u=nded RepoltiDg feature,
it is recommended tl'....t <.hi:. C.;;1:~.:r program be eliminated from further consideration.
HorJJ. u~ nrall_
The Florida League of Cities is the cuaent agent and the County participates in the Rorida Municipal
Insunnce Trust (FMIl). While the FMIT appears to opetate like a uaditional in$ut'er, it does not
come under the control of the Florida Dep:u:tment of1nsurance 'And does not enjoy.the protection of
me Florida Guanntee Association. The Florida Guaran~ Association is a Sta~ administaed
program designed to pattially pay the claims of insolvent inswers. It should also be rec~ chat
the FMIT hid a net income loss bf $45 million for the 1998/99 policy ~ that signi&andy
impacted its Policy Holders Surplus (Net WoLth). While no assurances can be given, a review of the
FMlTs 6nancial statanents 1ndicates that they wiJl have sufficient resoucces to lCSpond to its claim
obligations md will remain solvent.
The Florida League offered to renew the County's program with tem1S and conditions consistent
with the current program for a cost of S14O,929. This mpresents a $9,309 (7.1.) inctase over; the
1999/2000 premium. In5U1"eds have seen a ligni6cant increase in their insunnc.e costs in Rcent
months with some organizations having to pay 'as mud1 as 20-3Q-/. II1OD: for its inauattce protection.
It is therefore believed that the Florida League's ~ proposal ~ents the most attractive
3
09/01/2000 01:54 8132871041
INTERISK
ct' (2'
PAGE 0S
..
& ~.... - ~~
--8
i ~.~ ~ <<
i I
if;;1
j { 1551
>> ;g
~~
1 ~I~
~ I
'4 ~ .
I > 6
a ~ :r~
!
M I
&.A~""'- f;~
>D- - s?
~~~~ <<
i
If ..
2.1 !~.!:!8 ~~
g~:iil~ <<
01.
8
... if f("J
.Iift if ......
is.U nnn ~~
I~I [s