93-61 Resolution No. 93-61
RESOLUTION
AUTHORIZING EXECUTION OF AN AGREEMENT WITH
WASHINGTON NATIONAL INSURANCE COMPANY
BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF ELGIN,
ILLINOIS, that Larry L. Rice, City Manager, be and is hereby
authorized and directed to execute Appendix I to Minimum
Premium Agreement on behalf of the City of Elgin with
Washington National Insurance Company for an employee health
insurance program, a copy of which is attached hereto and made
a part hereof by reference.
s/ George VanDeVoorde
George VanDeVoorde, Mayor
Presented: March 10, 1993
Adopted: March 10, 1993
Omnibus Vote: Yeas 7 Nays 0
Recorded:
Attest:
s/ Dolonna Mecum
Dolonna Mecum, City Clerk
APPENDIX I TO MINIMUM PREMIUM AGREEMENT
SCHEDULE OF RATES, FACTORS AND FUNDING TERMS
CONTRACTHOLDER: CITY OF ELGIN
POLICY NUMBER(S) : 62945
POLICY YEAR: For purposes of this Appendix, the policy year will be
from November 1, 1992 to November 1, 1993 .
INDIVIDUAL CLAIM POOLING: X Is not included
Is included
Effective the maximum amount per covered person
is $ . Individual Claim Pooling is accumulated per
Policy Year and applies to Medical coverage.
POST TERMINATION LIABILITY:
Reserves are held by:
Washington National; or
X Contractholder;
If reserves are held by the Contractholder,
X Post Term Liability Limit does not apply.
Post Term Liability Limit applies for a
maximum period of days after the
termination date of the policy.
COVERAGES for which the Contractholder is assuming liability under
the Minimum Premium Agreement are: Medical
COVERAGES which are to be combined for Policy Year experience
accounting are: None
CLAIM LIABILITY LIMIT: Cumulative Annual Basis
(This appendix must be signed and dated on the reverse. )
WASHINGTON NATIONAL INSURANCE COMPANY - Evanston, Illinois 60201
F16428A
MINIMUM PREMIUM AGREEMENT
AGGREGATE POOLING AMENDMENT
Washington National Insurance Company and the City of Elgin
(Contractholder) agree that, in consideration
of payment by the Contractholder of an additional premium charge, the
Contractholder's liability shall be limited as described below under the
Minimum Premium Agreement between Washington National and the
Contractholder.
If at the end of the contract year, the Contractholder has paid all amounts
due under the Agreement, has paid all premiums due including any
retrospective premiums due, and the benefit payments made by the
Contractholder through the Bank exceed the Claim Liability Limit then the
amount of this excess after being reduced by any surplus from experience
rated coverages shall not be carried forward to subsequent contract years as
a deficit.
This Amendment shall not apply to any deficits created by expenses or
experience under experience rated coverages.
This Amendment shall supersede any terms of the Minimum Premium Agreement
between Washington National and the Contractholder which are inconsistent
with the Minimum Premium Agreement.
THIS AMENDMENT WILL BE EFFECTIVE FROM November 1 , 1992 to November j 1993
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Elgin, IL 3P/95 April 9 , 1993
Signed at Date Signed at date
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Agenda No.
February 18, 1993
TO: City Council
FROM: Larry Rice
SUBJECT: Renewal of Group Medical and Life Insurance
Purpose: This is to request that the Council authorize the
City Manager to sign the contracts renewing the City's Group
Life and Health Insurance with Washington National and H.M.O.
Illinois .
Background: The City has two group health insurance
programs . The minimum premium (self-insurance) plan is
through Washington National . Washington National is paid
premium for providing aggregate insurance, claims
administration and life insurance. The H.M.O. option is
through H.M.O. Illinois .
We went out for quotes on the minimum premium plan again this
year. None of the six companies who submitted quotes were
able to beat Washington National 's renewal rate. No competing
quote was received on the HMO option.
We had a good claims experience in the minimum premium plan in
1992 . We also saved $170,290 through our PPO arrangement.
Due to this, our composite rate went down from $383.33 to
$356 .27 for 1993.
HMO Illinois increased their rate by 6 .6% for 1993. Due to
this, employees covered by HMO will have to contribute the
difference between their HMO rate and the composite rate for
the minimum premium plan.
Financial Impact: Although there is a 4 .4% increase in our
aggregate/life/administration premium, our composite rate for
the minimum premium plan went down from $383. 33 in 1992/93 to
$356 .27 in 1993/94 . The HMO rate will increase from $359 .52
in 1992/93 to $385.00 in the 1993/94 premium year.
Recommendation: It is recommended that the Council
authorize the City Manager to sign the contracts necessary to
renew these insurance plans for the 1993/1994 year.
Larr ice, Ctt Manager
LR/vls
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