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Home My WebLink About98-233 0 Resolution No. 98-233 RESOLUTION ACCEPTING THE PROPOSAL OF LUNDSTROM INSURANCE FOR LIMITED SELF-INSURANCE PROGRAM BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF ELGIN, ILLINOIS, that Joyce A. Parker, City Manager, be and is hereby authorized and directed to accept the proposal on behalf of the City of Elgin of Lundstrom Insurance for the city' s limited self-insurance program for the period October 1, 1998 through September 30, 1999 as follows : a. The St. Paul Option III $75,000/occurrence SIR with $350,000 "All Lines" aggregate SIR proposal for a total excess premium and claims administration cost of $377, 686; b. The Illinois National Option II $250,000/occurrence compensation proposal for a total excess premium cost of $21, 300; c. The Cannon Cochran Management Services proposal for workers ' compensation claims administration services for $30,875; a copy of which is attached hereto and made a part hereof by reference. s/ Kevin Kelly Kevin Kelly, Mayor Presented: September 23, 1998 Adopted: September 23, 1998 Omnibus Vote: Yeas 6 Nays 0 Attest: s/ Dolonna Mecum Dolonna Mecum, City Clerk `m. OF E City of Elgin Agenda Item No. rji'l if 110$ r . . September 9, 1998 TO: Mayor and Members of the City Council FROM: Joyce A. Parker, City Manager SUBJECT: Worker' s Compensation Addendum to Insurance Renewal PURPOSE The purpose of this memorandum is to provide Council with new information regarding the worker' s compsensation excess insurance policy proposals which changes Risk Resouces ' and staff ' s recommendation for this coverage. BACKGROUND Enclosed is an addendum from Risk Resources indicating that the City has an opportunity to substantially decrease our self-insured retention (SIR) for worker' s compensation for a small increase in premium. As discussed in our earlier memorandum and as shown on the enclosed "Revised Chart IV" , the City' s current $300,000/occurrence SIR for worker' s compensation excess insurance was recommended to be renewed with Safety National ' s Option I at a cost of $19 , 197 (a savings of $25,935 from last year' s premium) . With the other options that have now been received and analyzed, Risk Resources and staff recommend the following additional 1998 enhancement: * That the City utilize $2133 of the above worker' s compensation premium savings and select Illinois National 's Option II , which offers a substantially lower SIR limit of $250, 000/occurrence; basically, this means that the City has reduced its potential risk on every worker' s compensaton claim by $50,000 in exchange for an additional $2133 in excess premium cost. COMMUNITY GROUPS/INTERESTED PERSONS CONTACTED None. Insurance Renewal September 9, 1998 Page 2 FINANCIAL IMPACT There are sufficient funds in the 1998 Risk Management Fund to cover the recommended additional worker' s compensation insurance premium of $2133. Sufficient funds will be established in the 1999 Risk Management Fund' s budget for the next year' s expenses . LEGAL IMPACT None. ALTERNATIVES * The City could save the entire $25 , 935 in excess worker' s compensation premium cost by keeping the Safety National Option I, which has the same $300,000/occurrence SIR limit and risk potential as our current program. * The City could utilize $2133 of the above savings and purchase Illinois National Option II which reduces our potential risk on every worker' s compensaton claim by $50, 000 . As shown on the revised Exhibit C Comparison Summary, the recommended renewal program (Revised Option III ) with all the noted enhancements is still $62,238 less than our expiring program. RECOMMENDATION Change Recommendaton b. from our previous memorandum to: b. To accept the Illinois National Option II $250,000/occurrence compensation proposal for a total excewss premium cost of $21 , 300 . Respectfully submitted, fQ4L-- Jo e A arker City Manager JAP/db ISK SOURCES Independent Risk Management Consultants September 9, 1998 Insurance Advisors Michael Sarro Purchasing Director City of Elgin 150 Dexter Court Elgin, IL 60120-5555 RE: ADDENDUM TO THE ANALYSIS OF PROPERTY AND LIABILITY INSURANCE PROPOSALS Dear Mike: Recent developments in our negotiations with the insurance carriers providing proposals for your property and liability insurance program have led us to reevaluate our recommendation regarding the Excess Workers Compensation Coverage. Originally, Safety National, your incumbent insurance carrier, had provided a single quotation using a self-insured retention level of$300,000 per occurrence. This is the City's current retention level. The competing insurance company, Illinois National, provided options using self-insured retention levels of$300,000, $250,000 and $200,000. We requested that Safety National provide additional options at lower retention levels. The attached revised Chart IV shows the result of this request. At the $250,000 retention level, Illinois National becomes the superior proposal. The City can reduce its retention level $50,000 for an additional premium of$2,133. We went back and analyzed the City's past eleven years loss experience and determined total additional recoveries from a $250,000 retention would have been $50,000. Total additional premiums from 1987 until present would have been $23,463. Based on the current pricing available for this coverage, our revised recommendation is to accept the Illinois National proposal using a $250,000 self-insured retention for Excess Workers Compensation Coverage. - • rul g ours Ran 1 ►eLopst RCD:sm • Enclosure OCLANTY7T6ti ftiTTALti YELAN 185 South York Street• Elmhurst, Illinois 60126 • Telephone (630) 617-5100 • Fax(630)617-5128 E-Mail:riskmanage@aol.com Chart IV City of Elgin Premium Comparison for 1998-99 Excess Workers Compensation Proposals (Revised 9/8/98) 1997-98 Current Safety Safety Illinois Safety Illinois Safety Illinois National National National National National National National Option I Option I Option II Option II Option III Option III Premium $ 45,132 $ 19,197 $ 19,500 $ 29,862 $ 21,330 Not quoted $ 38,395 Retention 300,000 300,000 300,000 250,000 250,000 $ 200,000 200,000 Rate .165 .063 .064 .098 .070 N/A .126 ChCLIDITS■CMICOMISNILMNI art t • REVISED COMPARISON SUMMARY Revised Self-Insured Retentions Current Option I Option II Option III Major Coverages: GL/Auto - Occurrence $150,000 $150,000 $100,000 $75,000 Public Officals - $100.000 $100,000 $100,000 $75,000 Occurrence Property - Occurrence $100,000 $100,000 $50,000 $50,000 "All Lines" Liab - $750,000 $750,000 $500,000 $350,000 Aggregate W.C. - Occurrence $300,000 $300,000 $300,000 $250,000 Excess Premium - $491,369 $384,130 $414,130 $429,031 Program Cost Savings vs. Current Cost $1 07,239 $77,239 $62,238 * Revised Option III includes the St Paul Option II and the Illinois National Option IL recommendations. • <0OFcCC�ti �t Co ` ' City of Elgin Agenda Item No. } September 4 , 1998 TO: Mayor and Members of the City Council FROM: Joyce A. Parker, City Manager SUBJECT: Insurance Renewal PURPOSE The purpose of this memorandum is to provide information to the Mayor and members of the City Council regarding the renewal of the City' s limited self-insurance program for the period October 1, 1998 through September 30, 1999 . BACKGROUND At the July 8th Committee of the Whole meeting, the City Council approved a proposal from Risk Resources (the City' s long-time independent insurance consultants) to coordinate the insurance renewal process and to perform a comprehensive review and analysis of the various proposals being presented by Lundstrom Insurance of Elgin (the City' s insurance agent) . The City' s current limited self-insurance program, which is expiring September 30, 1998 combines Safety National ' s $300, 000/occurrence self-insured retention (SIR=City' s deduct- ible) for workers compensation with claims administration by Cannon-Cochran Management Services, Inc. and the St . Paul ' s $150, 000/occurrence with $750, 000 annual aggregate SIR for "all lines" liability coupled with various excess insurance policies to give the City total coverage limits of $9, 000, 000/occurrence and $10, 000, 000 of aggregate liability. Risk Resources in their attached letter of recommendation (Exhibit A) analyzes all of the various proposal options submitted by Lundstrom (Exhibit B) . It is noted that the current "soft" insurance market discussed at the July 8th meeting as well as our good overall claims experience over the past several years has resulted in a substantial decrease in our excess insurance premium costs and have given us the opportunity to enhance the City' s Limited Self-Insurance Program by dramatically reducing our self-in- sured retentions for relatively modest increases in the excess premium costs . As noted in the Risk Resources analysis, St . Paul has offered the best overall package and included three proposal options Insurance Renewal September 4, 1998 Page 2 risk for our consideration; the various options and program costs are highlighted in the attached Comparison Summary (Exhibit C) . As has been the case in recent years, Risk Resources and staff are recommending that some of the $107, 239 savings generated by the St Paul Option I Proposal (same as current program) be utilized to continue the 1997 enhancements and select the St . Paul Option III , which provides for the greatest reductions in our self-insured retentions . Continue 1997 enhancements * Our Umbrella Liability coverage increased by $3, 000, 000, which improved the City' s total "all Lines" liability limits to $9, 000, 000/occurrence and $10, 000, 000 aggre- gate . * While leaving our Commercial Crime coverage limits at $500, 000, reduced our self-insurance deductibles from $100, 000 to $5, 000; this tremendous reduction in our deductible provides real insurance coverage beyond our SIR for our many Parks facilities (Parks office, both pools, both golf courses, Hemmens) that handle much lower levels of daily/weekly cash receipts . Recommended 1998 enhancements : * Our 506 co-insurance contingent Business Income interrup- tion coverage limits increased from $7, 000, 000 to $8, 750, 000 due to the increased tax revenues being realized from the Riverboat Casino operations. * Risk Resources recommends that we utilize approximately 400 of our premium savings and select St Paul Option III, which has substantially lower SIR limits ($75, 000/occurrence and an "all lines" aggregate of $350, 000) . Basically, this means that the City has reduced its potential risk on every liability claim by $75, 000 and has reduced its annual aggregate potential risk for all liability claims by $400, 000 in exchange for an additional $42 , 786 in excess premium costs . As shown on the Exhibit C - Comparison Summary, the recommended renewal program with the noted enhancements is still $64 , 471 less than our expiring program. COMMUNITY GROUPS/INTERESTED PERSONS CONTACTED None . eft- Insurance Renewal September 4, 1998 Page 3 rib- dtrA,7 INANCIAL IMPACT There are sufficient funds in the 1998 Risk Management Fund to cover the recommended insurance premiums of $396, 883 and related claims administration expenses of $30, 875 . Sufficient funds will be established in the 1999 Risk Management Fund' s budget for the next year' s expenses . LEGAL IMPACT .... c- None . J ALTERNATIVES * The City could save the entire $107, 239 in excess premium cost by accepting the St . Paul Option I , which has the same SIR limits and risk potential as our current pro- gram. * The City could utilize $30, 000 of the above savings and purchase Option II, which reduces our potential risk on most liability claims by $50, 000 and reduces our annual aggregate potential risk for all liability claims by elift. $250, 000 . * The City could utilize $42 , 786 of the above savings (and only $12, 786 more than Option II) and purchase Option III, which reduces our potential risk on most liability claims by $75, 000 and reduces our annual aggregate potential risk for all liability claims by $400, 000 . RECOMMENDATION The recommendation is that Lundstrom Insurance place the following limited self-insurance coverages for the period October 1, 1998 through September 30, 1999 outlined in the last column on page 18 of their proposal as follows : a. To accept the St . Paul Option III $75, 000/occurrence SIR with $350, 000 "All Lines" aggregate SIR proposal for a total excess premium and claims administration cost of $377, 686 . ;; i;`1 LY J b. To acc the Safety National $300, 000 SIR worker ' s compe ation propoT1 for a total excess premium cost of $19 97 . l'' c . To accept the Cannon Cochran Management Services proposal rib.- for worker' s compensation claims administration services for $30, 875 . Insurance Renewal September 4, 1998 Page 4 fri As noted in Risk Resources Memorandum, staff will continue to investigate the pollution liability coverages that may be available and bring that information to council at a future meeting for your consideration. al pectfully su itted, • cuk.....,- /ce I. Parker ity Manager JAP/db rah r • ISK A el•-- SOURCES Independent Risk Management Consultants Insurance Advisors August 28, 1998 Michael Sarro City of Elgin 150 Dexter Court Elgin, IL 60120-5555 RE: ANALYSIS OF PROPERTY AND LIABILITY INSURANCE PROPOSALS Dear Mike: We have analyzed the various proposals received for your property and liability insurance coverages effective October 1, 1998. This letter and the accompanying charts will summarize our findings and present our recommendations. Our report will consist of the following sections: 1. Property and liability coverages excluding workers compensation coverage 2. Workers compensation coverage 3. Workers compensation claim handling services 4. Additional considerations Property and Liability Insurance Coverage Excluding Workers Compensation Chart I displays the premium costs and self-insured retention levels of the various proposals. As you recall, the City currently has a self-insured retention of $100,000 for property coverage, $150,000 for most liability coverages with a cap of$750,000 aggregate for all coverages except boiler& machinery. ribk 185 South York Street • Elmhurst, Illinois 60126 •Telephone (630) 617-5100 • Fax(630) 617-5128 E-Mail: riskmanage@aol.com August 28, 1998 Page 2 Michael Sarro The two leading proposals were.St. Paul, the incumbent insurance carrier, and Royal. Chart II summarizes the major coverage differences between these proposals. As you can see, there are some areas where St. Paul is superior and some areas where Royal is superior. On balance,we believe the St. Paul proposal provides the best overall combination of price and coverage. RECOMMENDATION As of this date, we are still in negotiations with St. Paul to enhance several coverage areas from their original proposal. Given we can accomplish our negotiating goals, we recommend accepting the St. Paul proposal Option M. This option results in a premium savings of $33,161 from the current program. Also, this option significantly reduces the City's per occurrence and aggregate self-insured retentions for a modest premium charge. Workers Compensation Coverage Chart IVdisplays the proposals received for Excess Workers Compensation Coverage. As you recall, the City is self-insured for workers compensation claims and purchases excess stop loss insurance. Currently, the self-insured retention for this coverage is $300,000 per occurrence. Proposals were received from Safety National, the incumbent insurance carrier, and Illinois National. Illinois National offered three options to reduce the self-insured retention. RECOMMENDATION We recommend acceptance of the Safety National proposal maintaining the current self- insured retention of$300,000. In analyzing the City's loss experience from 1987 until the present,.there were only two claims over $200,000. The additional premium to reduce the self-insured retention was not cost effective. The total additional premiums from 1987 until present would have been $220,000. The total additional recoveries would have only been $120,000. Selecting the Safety National proposal results in a premium savings of$25,935 from the current program. Workers Compensation Claim Handling Services Chart VI displays the claim handling proposals received from Cannon, Cochran, Management Services, Inc. (CCMSI) and Willis Corroon Administrative Services Corporation (WCASC). CCMSI is the incumbent service provider. As the chart indicates, CCMSI has the most cost effective proposal. • 0 n m/rxna.maacTyu . August 28, 1998 Page 3 Michael Sarro l RECOMMENDATION We recommend remaining with CCMSI as the workers compensation claim handling service provider. Additional Considerations While most public entities and private sector firms do not purchase separate pollution liability insurance, we believe the City should consider purchasing this additional coverage. The City's liability insurance coverage provides limited coverage for pollution liability claims. Currently, there is no insurance coverage for the following types of pollution claims. 1. Claims arising out of fire fighting activities such as a hazardous materials response situation. 2. Claims arising out of the handling of chemicals or other hazardous substances. Examples include chlorine used in municipal pools or pesticides and/or herbicides used in maintenance of golf courses and parks. 3. Claims arising out of the transportation of hazardous materials on City vehicles. 4. Heating or ventilation problems in public buildings, i.e. carbon monoxide poisoning. Special Pollution Insurance Coverage is needed to provide protection for these types of claims. Your insurance broker, Lundstrom Insurance, has done some initial investigation of obtaining this coverage. 'They have received a price indication from American International Group, the leading insurer for pollution liability coverage. Price indications for this coverage ranged from a $25,000 premium for a $1,000,000 policy limit to $60,000 for a $5,000,000 policy limit. In order to obtain a firm quotation for this coverage, a detailed pollution insurance application will need to be submitted to the insurance company for review. We recommend the City complete the application and obtain a firm quotation for Pollution Liability Insurance Coverage. V, • tru# ours, C Ra eLopst RCD:sm Enclosures CKIJIMM.ITIZOTILITTENALTYCLON 21 r Chart I rik City of Elgin Premium Comparison for 1998-99 Property&Liability Insurance Proposals Excluding Workers Compensation Current 1997-98 St. Paul St. Paul St. Paul St. Paul Penco Coregis Royal Option I Option II Option III COVERAGE Property $410,987 $335,058 $365,058 $377,826 $432,686 $427,463 $326,095 Boiler& Machinery Included Included Included Included Included Included Included General Liability(l) Included Included Included Included Included Included Included Public Official Liability Included Included Included Included Included Included Included Umbrella Liability Included Included Included Included Included Included Included Not rbk,e Included Included Included Included quoted Included Included I Claim Handling Services Included Included Included Included Included Included Included SELF INSURED RETENTIONS PER OCCURRENCE Property 100,000 100,000 50,000 50,000 100,000 25,000 100,000 Public Officals 100,000 100,000 100,000 75,000 200,000 100,000 150,000 All Other Liability 150,000 150,000 100,000 75,000 200,000 100,000 150,000 Boiler&Machinery 2,000 2,000 2,000 2,000 2,000 2,000 2,000 Auto. Physical Damage 1,000 1,000 1,000 1,000 50,000 1,000 100,000 Crime 5,000 5,000 5,000 5,000 N/A 100,000 100,000 Aggregate (Maximum Not Total Retention Per Year) 750,000 750,000 500,000 350,000 Offered 570,000 450,000 (1) Includes Law Enforcement, Paramedic, Liquor and Automobile Liability ISK -'1= RESOURCES Chart II City of Elgin Major Coverage Comparison between St. Paul and Royal Proposals St. Paul Royal A. PROPERTY 1. .Coverage for property located in Flood Yes Yes, but must purchase National Zone A. Flood Insurance Coverage ($500,000 limit) as primary coverage. B. AUTOMOBILE PHYSICAL DAMAGE 1. Self Insured Retention $1,000 $100,000 ' C. GENERAL LIABILITY 1. Pollution claims arising out of: a.. Sewer Back Ups Yes, up to $2,000,000 No b. Fire fighting activities No Yes c. Pesticide or herbicide application No Yes, if performed according to government standards D. AUTOMOBILE LIABILITY 1. Pollution arising from transportation of No Yes hazardous materials E. PUBLIC OFFICIALS LIABILITY 1. Policy Limit $2,000,000 $10,000,000 2. Coverage for: a. Injunctive relief Yes No b. Breach of Contract Yes No c. Failure to obtain or maintain adequate No Yes insurance for the municipality Page 1 of 2 ISK -"=" _ SOURCES St. Paul Royal F` UMBRELLA/EXCESS LIABILITY I. Policy Limit Maximum a. Per Occurrence $ 9,000,000 $10,000,000 b. Total Aggregate all claims $10,000,000 $14,000,000 G. CRIME 1. Self Insured Retention $ 5,000 $ 100,000 H. GENERAL TERMS I. Three Year Premium Rate Guarantee Yes, if losses are less No than 40% of total premiums F Page 2 of 2 RISK RESOURCES Chart III en- City of Elgin Summary of Total Retention Costs for Property & Liability Insurance Excluding Workers Compensation as of 6/30/98 Year Total Retention Costs 1997 $734,464 1996 138,951 1995 157,269 • 1994 441,673 1993 529,911 1992 501,908 SK �� SOURCES Chart IV City of Elgin Premium Comparison for 1998-99 Excess Workers Compensation Proposals 1997-98 Current Safety Safety Illinois Illinois Illinois National National National National National Option I Option II Option III Premium $ 45,132 $ 19,197 $ 19,500 $ 21,330 $ 38,395 Retention 300,000 300,000 300,000 250,000 200,000 Rate .165 .063 . .064 .070 .126 RISK —1-1–•RESOURCES Chart V elab' City of Elgin Workers Compensation Loss Experience Years Developed Incurred Losses 1997 $ 764,307 1996 $ 494,129 1995 $1,086,120 1994 . $ 730,691 1993 $ 404,755 1992 $1,335,024 Average $ 802,504 — RESOURCES Chart VI City of Elgin 1998-99 Workers Compensation Claim Handling Proposals 1997-98 Current CCMSI WCASC CCMSI 1. Fees per claim: a. Indemnity $ 625 $ 625 $ 595 b. Medical Only $ 100 $ 100 $ 85 c. Incident Report Only None None $ 85 2. Expected fees first year $35,250 $30,875 $30,175 Fees to handle claims open more than 1 year $ 6,150 $ 6,150 See Note I below 4. Administration Costs Included Included $ 4,700 5. Fees to handle open claims from prior years N/A N/A $ 7,000 Total Estimated Fees $41,400 $37,025 $41,875 Notes: (1) There will be no additional fees to handle open claims as long as the WCASC contract remains in effect. CLCIMWRILUM4C0013147 017 tSK SOURCES CITY OF EL GIN 150 DEXTER CT ELGIN, IL 60120 I I PRESENTED BY: RONALD PAVLIK LUNDSTROM INSURANCE OCTOBER 1, 1998-1999 INTRODUCTION OF THE AGENCY For over four decades, Lundstrom Insurance has provided personal and commercial insurance services to a diverse client base of prestigious individuals and organizations. An intense commitment to personal services is the hallmark of Lundstrom Insurance's success. Lundstrom Insurance's client service is driven by the commitment to building and maintaining long-term relationships rather than short-term profits. Each client receives ongoing services which enhance the function and cost-effectiveness of their insurance and risk management programs. In a proactive vein, Lundstrom Insurance has already positioned resources to develop and market the next generation of insurance products and financial services. Lundstrom Insurance professionals are on the leading edge as changes occur in the financial services industry. Our well-trained professionals are dedicated to the highest standards of excellence. By utilizing the broad knowledge, experience and creativity of these professionals, lrLundstrom Insurance is able to provide a combination of sophisticated products and services. The bottom line on Lundstrom Insurance's capabilities is clear: Protecting the assets and earning power of your company from loss or destruction. The measure of our success is just as straight forward: The minimization of adverse financial effects on your cash flow, Balance Sheet and Profit and Loss Statement. We look forward to continue to demonstrate our effectiveness as your broker and risk management partner. I J I j 1 t INTRODUCTION OF THE SERVICING TEAM Lundstrom Insurance offers professional and experienced personnel, who stand ready at all times to serve your organization in any capacity related to the insurance function. We strive to attract high level employees that have demonstrated superior academic achievement, reached a level of maturity to deal with complex problems, and have the desire to improve through advanced training. We continually seek experienced personnel who can bring to us unique skills and have developed a professionalism consistent with our high standards. Our team approach allows us to provide dedicated and quality insurance, risk management and claims service to all our clients. You are assured to receive the utmost in personal service. We have organized the following service team approach: 1 Ron Pavlik - Account Executive. Supervision, as well as coordination, of the rest of the staff serving their area of responsibility, lies with an agency principle. We assist your firm with risk analysis including identification of exposures, recommend appropriate transfer of risk, and proper use of self-insurance and/or deductibles. We believe risk analysis is at the heart of your program. Laura Barker - Account Executive. Maintainin g a proper relationship with insurance P P P company contacts in order to provide the best combination of protection is essential. We will negotiate with companies for comprehensive coverages and fair pricing. The markets or carriers which we use, are selected based on their financial integrity, market share as it relates to particular coverages, and quality of local support staff. Heather Friedel - Claims Representative. At the time of a loss, we assist to make sure that the claim is presented in an appropriate and complete manner so that the loss settlement is fair and satisfactory. We will provide pro-active assistance and support to you on all claims. Whenever necessary, we will intervene in any coverage or monetary dispute between you and an insurance carrier. i j r I t - RISK MANAGEMENT SERVICES PROVIDED The Sales Risk Management Department of Lundstrom Insurance provides a variety of services to meet the risk management needs of our diverse client base. These services include, but are not limited to, the following: • Risk analysis including identification of exposure, recommended appropriate transfer of risk, and proper use of self-insurance and/or deductibles. • Work on a team approach with a backup account executive and also an agency customer service representative • Prepare complete and accurate specifications to solicit the most comprehensive and broadest coverages and programs available, in order to provide excellent value. • Maintenance of a proper relationship with insurance companies. The markets or carriers which we use are selected based on their financial integrity, market share as it relates to particular coverages, and quality of local support staff. eigh* • Work to "sell" your account to the insurance company underwriters by presenting the best and most comprehensive picture of your account. • Present the results of our efforts in a clear manner, and with the benefit of our experience provide recommendations. • Review all insurance provisions of leases, contracts, or other agreements, for adequacy, compliance, and any additional cost or coverages that may be required, and recommend modifications as needed and appropriate. • Assist in negotiating insurance problems with landlords, tenants, contractors, consultants, etc. • The issuance of Certificates of Insurance, Automobile Identification Cards and other insurance evidence as needed. • Order any policy changes and upon receipt, again review for accuracy. • Monitor and check each audit for accurate premium charges. • Provide a "Schedule of Insurance" for easy reference of your coverages. • At time of loss, we assist to make sure that the claim is presented in an appropriate and complete manner so that the loss settlement is fair and satisfactory. flibk • Be available when needed to assist in all of your insurance needs. We have specific "backup" people assigned to your account. I PROPERTY INSURANCE Insured: City Of Elgin Insurer: St. Paul Insurance Company Policy Term: 10/01/98 To 10/01/99 CAUSE OF LOSS FORM USED: Special Form: Provides coverage against All Risk of direct physical loss or damage, except those perils that are specifically excluded in the policy. rbk LOC# BLD# SUB. OF INS. AMOUNT COIN% DED. VALUATION 0 Blanket Real &Personal $99,799,027 100% $100,000 R/C Property Business Income $ 1,000,000 50% N/A 1 (Bartlett Water Supply) Contingent Tax Intern. $ 8,750,000 50% N/A (Elgin Riverboat) Extra Expense $ 1,000,000 Personal Property Including $ 25,000 Inventory at Other Location Electronic Data Processing, $ 1,354,827 (Class 9150/8150/145) Media and Extra Expense ir I j TERMS AND CONDITIONS: Coverage includes: Water Damage including back up of sewers Flood (Excluding Flood Zone A)-Limit: $6,000,000 Earthquake-$16,000,000-Underground pipes $ 6,000,000 -All Other Locations Difference In Conditions -$ 70,000,000 Replacement Cost Valuation for real,personal property and computers Actual Cash Value for auto and contractors equipment 100%valuation on real and personal property Agreed Amount-waiver of co-insurance on real property,personal property,auto physical damage, contractors equipment and computer equipment Operation of building laws, increased costs of construction and demolition and debris removal $100,000 deductible per claim except: * 1%for earthquake Business income and extra expense: Gross Earnings Fonn 30 days extended period of indemnity 50%valuation as respects Contingent Tax Interruption Agreed Amount-coinsurance waived Limit excludes ordinary payroll * Deductibl of 25 00 0 e $ ,0 and$5 ,000 are available. See Premium Summary Page. 1 j I I 3 I r INLAND MARINE Insured: City Of Elgin Insurer: St. Paul Insurance Company Policy Term: 10/01/98 To 10/01/99 I ' COVERAGE DEDUCTIBLE Contractors Equipment $20,134,843 $1,000 Miscellaneous Equipment $9,900,317 $1,000 (Vehicles) Leased Equipment $500,000 $1,000 Radio &Emergency Equipment $7,273,968 $1,000 Accounts Receivable $250,000 $1,000 Valuable Papers $100,000 $1,000 Fine Arts $150,000 $1,000 Unscheduled Equipment $1,000,000 $1,000 ■ I I J r I J rik COMMERCIAL CRIME Insured: City Of Elgin Insurer: St. Paul Insurance Company Policy Term: 10/01/98 To 10/01/99 COVERAGES LIMIT DED. * f INSURING AGREEMENTS: Blanket Public Employee Dishonesty $ 500,000 $ 5,000 Forgery or Alteration $ 500,000 $ 5,000 ro. Theft, Disappearance and Destruction Sec. 1 -Inside the Premises $ 500,000 $ 5,000 Sec. 2 -Outside the Premises $ 500,000 $ 5,000 Money Order&Counterfeit Currency $ 500,000 $ 5,000 I COVERAGE ENDORSEMENTS: J Faithful Performance Agreement applies I *Optional Deductibles Available: See Premium Summary Page P814 I I COMMERCIAL GENERAL LIABILITY Insured: City Of Elgin Insurer: St. Paul Insurance Company Policy Term: 10/01/98 To 10/01/99 F j COVERAGE WRITTEN ON: Occurrence Form I I COVERAGE LIMITS LIABILITY: General Aggregate Limit $ 3,000,000 Products/Completed Operations Aggregate Limit $3,000,000 Personal/Advertising Injury Limit $2,000,000 Each Occurrence $2,000,000 Fire Damage Limit-Any One Fire $ 100,000 Medical Expense Limit-Any One Person $ 5,000 Law enforcement-each wrongful act $2,000,000 Law enforcement-annual aggregate $2,000,000 Liquor Liability -Per Occurrence $2,000,000 Aggregate $3,000,000 Medical Professional $2,000,000 • Aggregate $3,000,000 Backup of Sewers &Drains(Third Party) $2,000,000 Failure to Supply $2,000,000 SIR $150,000 Applies to bodily injury and property damage,per occurrence $750,000 Combined aggregate for General Liability,Auto Liability, Public Officials Liability and Law Enforcement Liability I r • COVERAGES INCLUDED: Premises/Operations Products/Completed Operations Independent Contractors Blanket Contractual Liability Host Liquor Liability Employee as Additional Insured Broad Form Property Damage Incidental Medical Malpractice Limited Worldwide Liability (suits in U.S.) Automatic Coverage -Newly Acquired Organization(90 days) Public Executive Officers are Protected Persons Employee Benefits Liability (each claim and aggregate) Claims Made Coverage Limits: $1,000,000 each claim $3,000,000 aggregate 1 Deductible: $ 1,000 Retroactive Date: 10/01/87 I Note:All pollution is Preluded PlbkI I J I COMMERCIAL AUTOMOBILE Insured: City Of Elgin Insurer: St. Paul Insurance Company Policy Term: 10/01/98 To 10/01/99 COVERAGE LIMIT PER LIABILITY: Bodily Injury and Property Damage $ 2,000,000 CSL Each Accident Medical Payments $ 5,000 Each Person ellik SIR $ 150,000 Self Insured Retention $ 750,000 Combined Aggregate SIR for Auto Liability, General Liability, Public Officials Liability and Law Enforcement Liability I COVERAGE APPLICABLE TO Liability: Any Auto Hired Autos &Non Owned Automobile Medical Payments: All Owned Autos Comprehensive: All Owned Autos Collision: All Owned Autos COVERAGE ENDORSEMENTS: Note: Uninsured/Underinsured Liability Coverage is excluded. r I j e E i i i,,... BOILER & MACHINERY 1 1 Insured: City Of Elgin Insurer: Hartford Steam Boiler Policy Term: 10/01/98 To 10/01/99 COVERAGES LIMITS PER I ILIMITS OF INSURANCE: Direct Damage & $16,000,000 Any One Accident Extra Expense $1,000 * Deductible IBusiness Interruption $100,000 24 Hour Deductible Applies i el 161 I PP $2,000 deductible on sewage/water treatment facilities Expediting Expenses $35,000 IHazardous Substance Limitation $35,000 IAmmonia Contamination Limitation $35,000 Water Damage Limitation $35,000 Consequential Damage,Food &Food Products $35,000 (Solely While in Storage) JUtility Interruption Coverage Limited to: Transformers&NonRotating Electrical Apparatus Only Providing Electricity -0 Hour Deductible IJoint Loss Agreement Clause COVERAGE INCLUDES kb' Perils: Heating, air conditioning, cooling, freezers, boilers, 1. Electrical Injury including miscellaneous electrical apparatus panels,generators, I artifically generated current motors,etc. Mechanical breakdown Explosion of steam vessels and piping j ,.., I UMBRELLA LIABILITY' Insured: City Of Elgin Insurer: St. Paul Insurance Company Policy Term: 10/01/98 To 10/01/99 COVERAGE LIMIT PER Limit of Liability $ 7,000,000* Each Occurrence $ 7,000,000 Annual Aggregate Self Insured Retention $ 10,000 PRIMARY COVERAGES: 1 Commercial Liability $ 2,000,000 Each Occurrence $ 3,000,000 General Aggregate 1 $ 3,000,000 Products Aggregate $ 2,000,000 Personal Injury $ 100,000 Fire Damage Liability Auto Liability $ 2,000,000 Combined Single Limit Employers Liability $ 1,000,000 Each Accident $ 1,000,000 Disease Policy Limit I $ 1,000,000 Disease Each Employee Employee Benefits Liability $ 1,000,000 Each Claim 1 $ 3,000,000 Aggregate Law Enforcement Liability $ 2,000,000 Farh Wrongful Act I $ 2,000,000 Annual Aggregate Public Officials Liability $ 2,000,000 Each Claim/Annual Agg. Liquor Liability $ 2,000,000 Each Occurrence $ 3,000,000 Aggregate *Increased Limits Available I tel PUBLIC OFFICIALS LIABILITY Insured: City Of Elgin Insurer: St. Paul Insurance Company Policy Term: 10/01/98 To 10/01/99 COVERAGE WRITTEN ON: Claims Made Form Retroactive Date: 10/01/87 $750,000 Combined Aggregate SIR for General Liability,Auto Liability, Public Officials Liability and Law Enforcement Liability COVERAGE LIMITS LIABILITY: Each Claim/Annaul Aggregate Limit $2,000,000 Self Insured Retention: $ 100,000 11 SPECIFIC EXCESS WORKERS COMPENSATION Insured: City Of Elgin Insurer: Safety National Casualty- Option I Policy Term: 10/01/98 To 10/01/99 WORKERS COMPENSATION BENEFITS (A): STATUTORY States: Illinois EMPLOYERS LIABILITY(B): $1,000,000. E4 ACCIDENT 1 $1,000,000. POLICY LIMIT $1,000,000. EA EMPLOYEE PREMIUM BASIS: $30,471,300. OPTION A OPTION B OPTION C $300,000 Ea Accident $275,000 Ea Accident $250,000 Ea Accident RETENTION $300,000 Policy Limit $275,000 Policy Limit $250,000 Policy Limit $300,000 Ea Employee $275,000 Ea Employee $250,000 Ea Employee RATE .063 Per 100 Payroll .136 Per 100 Payroll .154 Per 100 Payroll PREMIUM $19,197 $41,441 $46,926 •. • I J r I SPECIFIC EXCESS WORKERS COMPENSATION Insured: City Of Elgin Insurer: Illinois National Insurance Company- Option II Policy Term: 10/01/98 To 10/01/99 WORKERS COMPENSATION BENEFITS (A): STATUTORY States: Illinois I EMPLOYERS LIABILITY(B): $1,000,000. EA ACCIDENT $1,000,000. POLICY LIMIT $1,000,000. EA EMPLOYEE IPREMIUM BASIS: $30,471,300. OPTION A OPTION B OPTION C $300,000 Ea Accident $250,000 Ea Accident $200,000 Ea Accident RETENTION $300,000 Policy Limit $250,000 Policy Limit $200,000 Policy Limit $300,000 Ea Employee $250,000 Ea Employee $200,000 Ea Employee RATE .064 Per 100 Payroll .07 Per 100 Payroll .126 Per 100 Payroll PREMIUM $19,500 $21,330 $38,395 I I r I I t PREMIUM COMPARISON Sr. PAUL, HARTFORD, SAFETY NATIONAL OPTION l EXPIRING RENEWAL PREMUM PREMUM W/5750,000 W/$750,000 COVERAGE BASKET BASKET Property+ [$100,000 SIR] 60,193 226,091 ' Inland Marine [$100,000 Deductible] 39,372 26,135 Crime [S 5,000 Deductible] 4,888 4,888 General Liability [$150,000 SIR] 91,953 Included I Liquor Liability ($150,000 SIR] Included Included Law Enforcement Liability [$150,000 SIR] 64,599 Included Paramedic Liability [$150,000 SIR] Included Included I Public Entity Management Liability [$100,000 SIR] 23,158 Included Auto Liability++ [150,000 SIR] 28,880 Included Auto Physical Damage [$1,000 Deductible] Included Included I Umbrella Liability 56,000 35,000 Claims Administration 32,548 32,548 (excluding Workers Compensation) ISt. Paul Total $401,591 $324,662 Boiler&Machinery-Hartford Steam Boiler $9,396 $9,396 IExcess Workers Compensation- Safety National 45,132 $19,197 IWorkers Compensation Claims Administration $35.250 $30,875 TOTAL PROGRAM COST: $491,369. $384,130 I +Property Values changed by$651,432 from expring ++Renewal exposure rated on 294 vehicles ,expiring based on 301 vehicles I I r I 1 k I PREMIUM COMPARISON ST. PAUL, HARTFORD, SAFETY NATIONAL OPTION II I EXPIRING RENEWAL PREMUM PREMUM W/$750,000 W/$500,000 COVERAGE BASKET BASKET Property+ [$50,000 SIR] 60,193 256,091 Inland Marine [$100,000 Deductible] 39,372 26,135 Crime [$ 5,000 Deductible] 4,888 4,888 1 General Liability [$100,000 SIR] 91,953 Included Liquor Liability ($100,000 SIR] Included Included Law Enforcement Liability [$100,000 SIR] 64,599 Included I Paramedic Liability [$100,000 SIR] Included Included Public Entity Management Liability [$100,000 SIR] 23,158 Included Auto Liability++ [100,000 SIR] 28,880 Included I Auto Physical Damage [$1,000 Deductible] Included Included Umbrella Liability 56,000 35,000 r Claims Administration 32,548 32,548 (excluding Workers Compensation) St. Paul Total $401,591 $354,662 IBoiler&Machinery-Hartford Steam Boiler $9,396 $9,396 Excess Workers Compensation- Safety National 45,132 $19,197 1 Workers Compensation Claims Administration $35.250 $30,875 TOTAL PROGRAM COST: $491,369. $414,130 +Property'Values changed b y$651,432 2 from expring ++Renewal exposure rated on 294 vehicles ,expiring based on 301 vehicles 1 J r 1 1 PREMIUM COMPARISON S T. PAUL HARTFORD SAFETY NATIONAL OPTION III EXPIRING RENEWAL PREMUM PREMUM W4750,000 W4350,000 CO VERAGE BASKET BASKET Property+ [$50,000 SIR] 60,193 268,859 Inland Marine [$100,000 Deductible] 39,372 26,135 Crime [S 5,000 Deductible] 4,888 4,888 General Liability [$75,000 SIR] 91,953 Included Liquor Liability [$75,000 SIR] Included Included Law Enforcement Liability [$75,000 SIR] 64,599 Included Paramedic Liability [$75,000 SIR] Included Included Public Entity Management Liability [$75,000 SIR] 23,158 Included Auto Liability++ [$75,000 SIR] 28,880 Included Auto Physical Damage [$1,000 Deductible] Included Included Umbrella Liability 56,000 35,000 Claims Administration 32,548 32,548 (excluding Workers Compensation) St. Paul Total $401,591 $367,430 Boiler&Machinery -Hartford Steam Boiler $9,396 $9,396 Excess Workers Compensation- Safety National 45,132 $19,197 Workers Compensation Claims Administration $35,250 $30,875 TOTAL PROGRAM COST: $491,369. $426,898 +Property Values changed by $651,432 from expring ++Renewal exposure rated on 294 vehicles ,expiring based on 301 vehicles PREMIUM COMPARISON - RANGERIAL.LIANZ PENCO' COVERAGE Property+ ($100,000 Deductible] $58,050 Inland Marine [$100,000 Deductible] Included Crime Not Provided General Liability [$200,000 SIR] $225,000 Liquor Liability [$200,000 SIR] Included Law Enforcement Liability [$200,000 SIR] $45,000 Paramedic Liability [$200,000 SIR] Included Public Entity Management Liability [$200,000 SIR] $28,000 I oft, Auto Liability ($200,000 SIR] Included Auto Physical Damage [$50,000 Deductible] Included Umbrella Liability Included Claims Administration-WCASC Indication Option I $67,240 Subtotal: $423,290 Boiler& Machinery-Hartford Steam Boiler $9,396 Excess Workers Compensation- $300 000 SIR]( � ] Included Lundstrom Subtotal: $432,686 TOTAL PROGRAM COST: 1) Difference in conditions. Crime coverages are Not Provided 1 2) There is no Basket SIR or Stop Loss Aggregate 3) Maximum limit provided-S million aggregate I r I I ipink PREMIUM COMPARISON - COREGIS t PREMIUM W/$670,000 COVERAGE BASKET Property+ [$25,000 SIR] 326,732 Inland Marine [$100,000 Deductible] Included Crime [$100,000 Deductible] Included General Liability [$100,000 SIR] Included Liquor Liability [$100,000 SIR] Included Law Enforcement Liability [$100,000 SIR] Included Paramedic Liability [$100,000 SIR] Included Public Entity Management Liability [$100,000 SIR] 41,408 Auto Liability [$100,000 SIR] Included Auto Physical Damage [$1,000 Deductible] Included Umbrella Liability $11,280 Claims Administration -WCASC Indication (Option I) $67.240 Coregis Total $446,660 Boiler&Machinery Included Excess Workers Compensation -Safety National $19.197 TOTAL PROGRAM COST: $465,857 I Earthquake coverage for underground piping is NOT INCLUDED *Policy exclusions for umbrella: Professional Liability,y,Arcluteetual Engineers & Surveyors, Molestation or Sexual Abuse, ERISA, Real &Personal Property in the Insureds Care, Custody &Control,Asbestos, Inverse Condemnation Nuclear, Injury to Volunteer Firemen, Uninsured/Underinsured Motorist Pollution Indication: 1 million w/$10,000 deductible=6,000+T&F 1 million w/$25,000 deductible=5,400+T&F 2 million w/$10,000 deductible= 7.500+T&F I I r PREMIUM COMPARISON - S.J. PETRAKIS/ROYAL PREMIUM W4450,000 COVERAGE STOP LOSS Property+ [$100,000 Deductible] 50,225 Inland Marine [$100,000 Deductible] Included Crime Not Provided General Liability [$150,000 SIR] 199,234 Liquor Liability [$150,000 SIR] Included Law Enforcement Liability [$150,000 SIR] Included Paramedic Liability [$150,000 SIR] Included Public Entity Management Liability [$150,000 SIR] Included Auto Liability ($150,000 SIR] Included Auto Physical Damage [$100,000 Deductible] Included Umbrella Liability Included Claims Administration-WCASC Indication (Option I) $67,240 Royal Total: $316,699 Boiler&Machinery-Hartford Steam 9,396 Excess Workers Compensation-Safety National $19,197 TOTAL PROGRAM COST: $345,292 This proposal does not include the following: Environmental Liability, Crime,Treasurer's Surety, City Managers Surety Bond, Coverage for"Dams". The exclusion for Dams may be deleted upon receipt of updated engineering reports,downstream exposure, inspection reports,maps and hazard rating of the dam. Revised pricing and terms may be applied. Property terms are subject to receipt of underwriting information consisting of age of buildings, construction type, protection devices i.e. sprinkelered, smoke alarms,detectors etc. A premium payment plan is not available for the Royal proposal. Hartford and Saftey National payment terms remain as previously presented. 21