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08-8
f rs Resolution No. 08-8 RESOLUTION AUTHORIZING EXECUTION OF AN AGREEMENT WITH GALLAGHER BENEFIT SERVICES, INC., FOR HEALTH INSURANCE BROKER SERVICES BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF ELGIN, ILLINOIS, that Olufemi Folarin, City Manager, and Diane Robertson, City Clerk, be and are hereby authorized and directed to execute an agreement on behalf of the City of Elgin with Gallagher Benefit Services, Inc., for health insurance broker services, a copy of which is attached hereto and made a part hereof by reference. s/Ed Schock Ed Schock, Mayor Presented: January 9, 2008 Adopted: January 9, 2008 Vote: Yeas: 7 Nays: 0 Attest: s/Diane Robertson Diane Robertson, City Clerk ` j, AGREEMENT THIS AGREEMENT, made and entered into the 9th day of January, 2008, by and between the CITY OF ELGIN, an Illinois municipal corporation (hereinafter referred to as "CITY") and Gallagher Benefit Services, Inc., a Delaware corporation (hereinafter referred to as "CONSULTANT-BROKER"). WHEREAS, the CITY desires to engage the CONSULTANT-BROKER to furnish certain professional services in connection with all employee Health and Welfare related benefit programs as defined below (hereinafter referred to as the PROJECT). AND WHEREAS, the CONSULTANT-BROKER represents that it is in compliance with Illinois Statutes relating to professional registration of its field and has the necessary expertise and experience to furnish such services upon the terms and conditions set forth herein below. NOW, THEREFORE, it is hereby agreed by and between the CITY and the CONSULTANT- BROKER that the CITY does hereby retain the CONSULTANT-BROKER for and in consideration of the mutual promises and covenants contained herein, the sufficiency of which is hereby acknowledged to act for and represent it in the consultant-brokering matters involved in the PROJECT, subject to the following terms and conditions and stipulations,to-wit: I. SCOPE OF SERVICES A. All work hereunder shall be performed under the direction of the Director of Human Resources of the CITY,herein after referred to as the "DIRECTOR". B. Generally, the CONSULTANT-BROKER shall provide the CITY the following services pursuant to this Agreement: renewal analysis; quarterly financial reports; annual financial reports (end of year accounting); legislative and corporate compliance support; carrier marketing and negotiations; union negotiation assistance; employee education assistance; communication materials; market benchmarking studies; an annual service plan; and stewardship report. C. A detailed Scope of Services of the services to be provided by the Consultant Broker to the CITY pursuant to this Agreement is attached hereto as Attachment A. II. PROGRESS REPORTS A. An outline project milestone schedule is provided herein under. B. A detailed project schedule for the Project is included as Attachment B, attached hereto. Progress will be recorded on the project schedule and submitted monthly as a component of the Status Report described in C. below. C. The Consultant-Broker will submit to the Director monthly a Status Report keyed to the Project Schedule. A brief narrative will be provided identifying progress, findings and outstanding issues. 1 III. WORK PRODUCTS All work products prepared by the CONSULTANT-BROKER pursuant hereto including, but not limited too, reports, designs, calculations, work drawings, studies, photographs, models and recommendations shall be the property of the CITY and shall be delivered to the CITY upon request of the DIRECTOR provided, however, that the CONSULTANT-BROKER may retain copies of such work products for its records. Such work products are not intended or represented to be suitable for reuse by the CITY on any extension to the PROJECT or on any other project, and such reuse shall be at the sole risk of the CITY without liability or legal exposure to the CONSULTANT-BROKER. IV. PAYMENTS TO THE CONSULTANT-BROKER A. The CITY shall reimburse the CONSULTANT-BROKER for services under this Agreement for 2008 in a lump sum of Eighty Thousand Dollars ($80,000), regardless of actual costs incurred by the CONSULTANT-BROKER unless SUBSTANTIAL modifications to the project are authorized in writing by the DIRECTOR. In the event this Agreement continues beyond 2008 as provided under Section VII hereof the annual compensation for the additional years of this Agreement shall be Eighty Thousand Dollars ($80,000) for 2009, Eighty- five Thousand Dollars ($85,000) for 2010, Eighty-five Thousand Dollars ($85,000) for 2011, and Ninety Thousand Dollars ($90,000) for 2012. Such lump sum payments by the CITY to the CONSULTANT-BROKER provided for under this section shall be the sole compensation due from the CITY to the CONSULTANT-BROKER for services under this Agreement and there will be no other fees or commissions due or payable to the CONSULTANT-BROKER. B. The CITY shall make periodic payments to the CONSULTANT-BROKER based upon actual progress within thirty (30) days after receipt and approval of invoice. Said periodic payments to the CONSULTANT-BROKER shall not exceed the amounts shown in the following schedule: 2008 AND 2009 QUARTERLY PAYMENT SCHEDULE: 1st Quarter—Invoice of$20,000 on January 15th,payable on February 15th 2"d Quarter—Invoice of$20,000 on April 15th,payable on May 15th Std Quarter—Invoice of$20,000 on July 15th, payable on August 15th 4th Quarter—Invoice of$20,000 on October 15th,payable on November 15th 2010 AND 2011 QUARTERLY PAYMENT SCHEDULE: 1St Quarter—Invoice of$21,250 on January 15th,payable on February 15 2 116 Quarter—Invoice of$21,250 on April 15th,payable on May 15th 3`d Quarter—Invoice of$21,250 on July 15th,payable on August 15th 4th Quarter—Invoice of$21,250 on October 1 5th,payable on November 15th 2012 QUARTERLY PAYMENT SCHEDULE: 1st Quarter—Invoice of$22,500 on January 15th,payable on February 15th 2"d Quarter—Invoice of$22,500 on April 15th,payable on May 15t1 3'd Quarter—Invoice of$22,500 on July 15th,payable on August 15th 4th Quarter—Invoice of$22,500 on October 15th, payable on November 15th - 2- V. INVOICES The CONSULTANT-BROKER shall submit invoices in a format approved by the CITY. Progress reports (IIC above)will be included with all payment requests. VI. TERMINATION OF AGREEMENT Notwithstanding any other provision hereof, the CITY may terminate this Agreement at any time upon fifteen (15) days prior written notice to the CONSULTANT- BROKER. In the event that this Agreement is so terminated, the CONSULTANT- BROKER shall be paid for services actually performed and reimbursable expenses actually incurred prior to termination, except that reimbursement shall not exceed the task amounts set forth under Paragraph IV above. VII. TERM The term of this Agreement shall be from January 1, 2008 through December 31, 2008. This Agreement shall automatically renew for the years 2009, 2010, 2011, and 2012 unless not less than sixty (60) days prior to the end of any such calendar year either party shall provide written notice to the other party of its intention not to renew this Agreement. In the event of such a non-renewal notice, this Agreement shall be deemed terminated at the end of the applicable calendar year. This Agreement shall become effective as of the date the CONSULTANT-BROKER is given a notice to proceed and, unless terminated for cause or pursuant to Article V, shall be deemed concluded on the date the CITY determines that all of the CONSULTANT- BROKER's work under this agreement is completed. A determination of completion shall not constitute a waiver of any rights or claims which the CITY may have or thereafter acquire with respect to any term or provision of the Agreement. VIII. NOTICE OF CLAIM If the CONSULTANT-BROKER wishes to make a claim for additional compensation as a result of action taken by the CITY, the CONSULTANT-BROKER shall give written notice of his claim within fifteen(15) days after occurrence of such action. No claim for additional compensation shall be valid unless so made. Any changes in the CONSULTANT-BROKER's fee shall be valid only to the extent that such changes are included in writing signed by the CITY and the CONSULTANT-BROKER. Regardless of the decision of the DIRECTOR relative to a claim submitted by the CONSULTANT-BROKER, all work required under this Agreement as determined by the DIRECTOR shall proceed without interruption. IX. BREACH OF CONTRACT If either party violates or breaches any term of this Agreement, such violation or breach shall be deemed to constitute a default, and the other party has the right to seek such administrative, contractual or legal remedies as may be suitable to the violation or breach; and, in addition, if either party, by reason of any default, fails within fifteen (15) days after notice thereof by the other party to comply with the conditions of the Agreement, the other party may terminate this Agreement. X. INDEMNIFICATION To the fullest extent permitted by law, CONSULTANT-BROKER agrees to and shall indemnify, defend and hold harmless the CITY, its officers, employees, agents,boards - 3 - and commissions from and against any and all claims, suits, judgments, costs, attorneys fees, damages or other relief, including but not limited to workers compensation claims, in any way resulting from or arising out of negligent actions or omissions of the CONSULTANT-BROKER in connection herewith, including negligence or omissions of employees or agents of the CONSULTANT-BROKER arising out of the performance of this Agreement. In the event of any action against the CITY, its officers, employees, agents, boards or commissions, covered by the foregoing duty to indemnify, defend and hold harmless such action shall be defended by legal counsel of the CITY's choosing. The provisions of this paragraph shall survive any completion, expiration and/or termination of this Agreement. XI. NO PERSONAL LIABILITY No official, director, officer, agent or employee of the CITY shall be charged personally or held contractually liable under any term or provision of this Agreement or because of their execution, approval or attempted execution of this Agreement. XII. INSURANCE A. Comprehensive Liability. The CONSULTANT-BROKER shall provide, pay for and maintain in effect, during the term of this Agreement, a policy of comprehensive general liability insurance with limits of at least $1,000,000 aggregate for bodily injury and$1,000,000 aggregate for property damage. The CONSULTANT-BROKER shall deliver to the DIRECTOR a Certification of Insurance naming the CITY as additional insured. The policy shall not be modified or terminated without thirty (30) days prior written notice to the DIRECTOR. The Certificate of Insurance which shall include Contractual obligation assumed by the CONSULTANT-BROKER under Article X entitled "Indemnification" shall be provided. This insurance shall apply as primary insurance with respect to any other insurance or self-insurance programs afforded to the CITY. There shall be no endorsement or modification of this insurance to make it excess over other available insurance, alternatively, if the insurance states that it is excess or prorate, it shall be endorsed to be primary with respect to the CITY. B. Comprehensive Automobile Liability. Comprehensive Automobile Liability Insurance covering all owned, non-owned and hired motor vehicles with limits of not less than $500,000 per occurrence for damage to property. C. Combined Single Limit Policy. The requirements for insurance coverage for the general liability and auto exposures may be met with a combined single limit of$1,000,000 per occurrence subject to a$1,000,000 aggregate. D. Professional Liability. The CONSULTANT-BROKER shall carry Consultant- brokers Professional Liability Insurance Covering claims resulting from error, omissions or negligent acts with a combined single limit of not less than $1,000,000 per occurrence. A Certificate of Insurance shall be submitted to the DIRECTOR as evidence of insurance protection. The policy shall not be modified or terminated without thirty (30) days prior written notice to the DIRECTOR. - 4- XIII. NONDISCRIMINATION In all hiring or employment made possible or resulting from this Agreement, there shall be no discrimination against any employee or applicant for employment because of sex, age, race, color, creed, national origin, marital status, of the presence of any sensory, mental or physical handicap, unless based upon a bona fide occupational qualification, and this requirement shall apply to, but not be limited to, the following: employment advertising, layoff or termination, rates of pay or other forms of compensation and selection for training, including apprenticeship. No person shall be denied or subjected to discrimination in receipt of the benefit of any services or activities made possible by or resulting from this Agreement on the grounds of sex, race, color, creed, national origin, age except minimum age and retirement provisions, marital status or the presence of any sensory,mental or physical handicap. Any violation of this provision shall be considered a violation of a material provision of this Agreement and shall be grounds for cancellation, termination or suspension, in whole or in part, of the Agreement by the CITY. XIV. ASSIGNMENT AND SUCCESSORS This Agreement and each and every portion thereof shall be binding upon the successors and the assigns of the parties hereto; provided,however, that no assignment shall be made without the prior written consent of the CITY. XV. DELEGATIONS AND SUBCONTRACTORS Any assignment, delegation or subcontracting shall be subject to all the terms, conditions and other provisions of this Agreement and the CONSULTANT-BROKER shall remain liable to the CITY with respect to each and every item, condition and other provision hereof to the same extent that the CONSULTANT-BROKER would have been obligated if it had done the work itself and no assignment, delegation or subcontract had been made. Any proposed subcontractor shall require the CITY's advanced written approval. XVI. NO CO-PARTNERSHIP OR AGENCY This agreement shall not be construed so as to create a partnership, joint venture, employment or other agency relationship between the parties hereto. XVII. SEVERABILITY The parties intend and agreed that, if any paragraph, sub-paragraph, phrase, clause or other provision of this Agreement, or any portion thereof, shall be held to be void or otherwise unenforceable, all other portions of this Agreement shall remain in full force and effect. XVIII. HEADINGS The headings of the several paragraphs of this Agreement are inserted only as a matter of convenience and for reference and in no way are they intended to define, limit or describe the scope of intent of any provision of this Agreement, nor shall they be construed to affect in any manner the terms and provisions hereof or the interpretation or construction thereof. - 5 - XIX. MODIFICATION OR AMENDMENT This Agreement and its attachments constitutes the entire Agreement of the parties on the subject matter hereof and may not be changed, modified, discharged or extended except by written amendment duly executed by the parties. Each party agrees that no representations or warranties shall be binding upon the other party unless expressed in writing herein or in a duly executed amendment hereof, or change order as herein provided. XX. APPLICABLE LAW This Agreement shall be deemed to have been made in, and shall be construed in accordance with the laws of the State of Illinois. Venue for the resolution of any disputes or the enforcement of any rights pursuant to this agreement shall be in the Circuit Court of Kane County, Illinois. XXI. NEWS RELEASES The CONSULTANT-BROKER may not issue any news releases without prior approval from the DIRECTOR, nor will the CONSULTANT-BROKER make public proposals developed under this Agreement without prior written approval from the DIRECTOR prior to said documentation becoming matters of public record. XXII. COOPERATION WITH OTHER CONSULTANTS The CONSULTANT-BROKER shall cooperate with any other consultants in the CITY's employ or any work associated with the PROJECT. XXIII. INTERFERENCE WITH PUBLIC CONTRACTING The CONSULTANT-BROKER certifies hereby that it is not barred from bidding on this contract as a result of a violation of 720 ILCS 5/33E et seq. Or any similar state or federal statute regarding bid rigging. XXIV. SEXUAL HARASSMENT As a condition of this contract, the CONSULTANT-BROKER shall have written sexual harassment policies that include, at a minimum, the following information: A. the illegality of sexual harassment; B. the definition of sexual harassment under state law; C. a description of sexual harassment, utilizing examples; D. the vendor's internal complaint process including penalties; E. the legal recourse, investigative and complaint process available through the Illinois Department of Human Rights, and the Illinois Human Rights Commission; F. directions on how to contact the department and commission; G. protection against retaliation as provided by Section 6-101 of the Human Rights - 6 - Act. A copy of the policies must be provided to the Department of Human Rights upon request 775 ILCS 5/2-105. XXV. WRITTEN COMMUNICATIONS All recommendations and other communications by the CONSULTANT-BROKER to the DIRECTOR and to other participants which may affect cost or time of completion, shall be made or confirmed in writing. The DIRECTOR may also require other recommendations and communications by the CONSULTANT-BROKER be made or confirmed in writing. XXVI. COMPLIANCE WITH LAWS Notwithstanding any other provision of this Agreement it is expressly agreed and understood that in connection with the performance of this Agreement that the CONSULTANT-BROKER shall comply with all applicable Federal, State, City and other requirements of law, including, but not limited to, any applicable requirements regarding prevailing wages, minimum wage, workplace safety and legal status of employees. CONSULTANT-BROKER shall also at its expense secure all permits and licenses, pay all charges and fees and give all notices necessary and incident to the due and lawful prosecution of the work, and/or the products and/or services to be provided for in this Agreement. XXVII. NO PRACTICE OF LAW CONSULTANT-BROKER will not be obligated to perform, and the CITY will not request performance of, any services which may constitute unauthorized practice of law. The CITY will be solely responsible for obtaining any legal advice, review or opinion as may be necessary to ensure that its own conduct and operations, including the engagement of CONSULTANT-BROKER under the scope and terms as provided herein, conform in all respects with applicable State and Federal laws and regulations (including the Internal Revenue Code, State and securities laws and implementing regulations). XXVIII. ACKNOWLEDGEMENTS In connection with CONTRACTOR-BROKER services under this Agreement, CITY agrees that: Although CONTRACTOR-BROKER will apply its professional judgment to access those insurance companies it believes are best suited to insure the CITY's risks, there can be no assurance that the insurance companies CONTRACTOR-BROKER has accessed are the only or are the best suited ones to insure the CITY'S risks. The final decision to choose any insurance company has been made by the CITY in its sole and absolute discretion. The CITY understands and agrees that CONTRACTOR- BROKER does not take risk, and that contractor-broker does not guarantee the financial solvency or security of any insurance company. In the performance of its duties, CONTRACTOR-BROKER may rely upon, and will have no obligation to independently verify the accuracy, completeness, or authenticity of, any written instructions or information provided to the CONTACTOR-BROKER - 7 - by the CITY or its designated representatives and reasonably believed by the CONTRACTOR-BROKER to be genuine and authorized by the CITY. XXIX. APPROPRIATIONS The fiscal year of the CITY is the twelve-month period ending December 31. The obligations of the CITY under any contract for any fiscal year are subject to and contingent upon the appropriation of funds sufficient to discharge the obligations which accrue in that fiscal year and authorization to spend such funds for the purposes of the contract. If, for any fiscal year during the term of this Agreement, sufficient funds for the discharge of the CITY's obligations under the agreement are not appropriated and authorized, then the Agreement shall terminate as of the last day of the preceding fiscal year, or when such appropriate and authorized funds are exhausted, whichever is later, without liability to the CITY for damages, penalties or other charges on account of such termination. XXX. NOTICES All notices, reports and documents required under this Agreement shall be in writing and shall be mailed by First Class Mail,postage prepaid, addressed as follows: A. As to CITY: Gail Cohen Human Resources City of Elgin 150 Dexter Court Elgin, Illinois 60120-5555 B. As to CONSULTANT-BROKER: Martin Lyons Area Vice President Gallagher Benefit Services Two Pierce Place Itasca, IL 60143 IN WITNESS WHEREOF, the undersigned have placed their hands and seals upon and executed this Agreement in triplicate as though each copy hereof was an original and that there are no other oral agreements that have not been reduced to writing in this statement. SIGNATURE PAGE FOLLOWS - 8 - For the CITY: ATTEST: THE CITY OF ELGIN By L By � � _ City Clerk i alter (SEAL) For the CONSULTANT-BROKER: By Secretary `(.� By resident (SEAL) F:\Legal Dept\Agneement\Gallagher Benefit Services-clean-1-3-08-WAC.doc - 9 - ti CITY OF ELGIN Service Plan—2008 APPENDIX B CITY OF ELGIN Brief Description of Client The City of Elgin is a mid-size full service community with approximately 750 employees, providing police, fire, public works and other services. Name and Title Responsibilities Gail Cohen Human Resources Jacqueline Stashwick Employee Benefits James Nowicki Fiscal Services Director GBS CONSULTING TEAM LEADERS Name and Title Responsibilities Chris Cordes—Area Executive Vice President Managing Partner Marty Lyons—Area Vice President, Client Development Team Lead, Strategic Vision,Consultant Dave Torri—Area Vice President, Client Mangement Service Team Manager Gregg Aleman—Senior Area Vice President, Client Strategic Vision, Consultant Development Emilie Grischow—Client Representative Client Management,Day-Day Service John Edgerton—Underwriting Consultant Renewal Calculations,Underwriting Lead 1 Gallagher Benefit Services, Inc. CITY OF ELGIN Service Plan—2008 APPENDIX B 2008 SUMMARY MISSION STATEMENT SAMPLE: To PROVIDE A QUALITY BENEFITS PROGRAM TO CITY EMPLOYEES AND RETIREES IN A COST EFFICIENT MANNER 2008 BENEFIT OBJECTIVES COMPLETE 2008-09 RENEWAL ANALYSIS 1. PLAN DESIGN ALTERNATIVES,NETWORK ALTERNATIVES,RX ALTERNATIVES 2. CONTRIBUTION STRATEGY REVIEW 3. FUNDING ANALYSIS REVIEW SUPPORT OPEN ENROLLMENT 1. CREATE BENEFITS SUMMARIES AND OTHER EMPLOYEE COMMUNICATIONS 2. ARRANGE FOR CARRIER PRESENCE AT MEETINGS 3. STAFF MEETINGS AND DISCUSS BENEFITS WITH EMPLOYEES/RETIREES/DEPENDENTS MODIFY MONTHLY/QUARTERLY REPORTS TO MEET CITIES NEEDS GBS INSIGHT AND ENWISEN INSTALLATION SEMI-ANNUAL CARRIER PERFORMANCE REVIEWS QUARTERLY MEETING SCHEDULING AND AGENDA PLANNING PROVIDE QUARTERLY SEMINARS 2 1/9/2008 Gallagher Benefit Services, Inc. CITY OF ELGIN Service Plan—2008 APPENDIX B Major Accomplishments in the Past 12—24 Months 3 G 1/9/2008 Gallagher Benefit Services, Inc. CITY OF ELGIN Service Plan—2008 APPENDIX B ➢ REVIEW PLAN ALTERNATIVES ON A VOLUNTARY BASIS TO PROVIDE EMPLOYEE CHOICE AND COST CONTAINMENT ➢ CONSIDER ALTERNATIVE FUNDING MECHANISMS AVAILABLE GBS SERVICES — Voluntary Benefit evaluation — HR Consulting — Actuarial services — Medicare Subsidy Actuarial Valuation — Executive Benefit Review/Evaluation — Online Benefit Administration Evaluation — P&C Services ADDITIONAL COMMENTS: 4 1/9/2008 Gallagher Benefit Services, Inc. APPENDIX B 2008-2009 PLANNING CALENDAR Activity ;€Who Target Date(s) .�r',.�.-.<„ �:��.�,-A,,.x�«�g„�,6z�.s�:...Y =��rH%t c..<.,.�< �✓ gw� »..,y: �'�a*�� ��zr"`,<� ,�.` w,b,� ���.�.r.�S»,� LAS'r Qt. AR 1 ER 2007-05 D C 1, 2017Ttit.01.0 I FLBR t A in 28, 2008 Kickoff Meetings/Planning GBS/City December 15, 2007 Renewal Discussion and Action Steps GBS/City December 15, 2007 Present Preliminary Renewal Numbers and GBS/City/Carriers December 15, 2007 through Options January 15,2008 Present Marketing results on benefit plans to be GBS/City January 11, 2008 marketed Open Enrollment meetings GBS/City/Carriers January 15 through February 15,2008 Finalize Renewal and administer plan/carrier GBS/City February 2008 changes Implement GBS Insight and Enwisen GBS/City January 15 through March 15,2008 Activity Who Target Dates) „,�*�� �w�"..�!. .,, .:.-„� vw.,:.... �- �,x:.,, �� �.� ,' ��rw..�,� �.,,... ..,✓ ;w-`.,,..ate ��.. <�..� .,.,,,, .rr,�<� �.,�, .`..w...._ Fi RS ` Q -:vRTf.P 1\1,vRt;I1 1, 2L0' -\1'.2008-NIAY 30, 2008 Reporting design review and modification GBS/City March 15,2008 meeting Year-End Performance Report GBS April 15, 2008 Quarterly Meeting—GBS Insight/Enwisen GBS/City April 15, 2008 Presentation APPENDIX B 2008-2009 PLANNING CALENDAR city Q :Activity Target t Ia ' �o et Date(s) Sl CU1 Qt ;�1t1 Fl [ ltilY. 1,?0t.c7t.sr 30, 2008 Quarterly Meeting GBS/City July 15,2008 Benchmarking Report GBS July 15,2008 Strategic Planning Discussion based on GBS/City July 15,2008 Benchmark report and on City Goals/Obj. Plan performance update GBS July 15, 2008 APPENDIX B Activity Who Target et fate( TIIIRI) Qt�AIZTER SEPTLIit3ER 1,2008-NovtMBER 30,2008 Quarterly Meeting GBS/City October 15, 2008 Preliminary Budget Planning GBS/City October 15,2008 Plan Performance Update GBS October 15,2008 Plan design alternatives discussion GBS/City October 15,2008 2009-10 Plan Alternatives Meeting GBS/City November 15,2008 , j• APPENDIX B Activity 1,,ISVho Tat:get Date($ a��d.� � �.. , �,..o 1:0( R 1 i 1 t-AR'l'ER DECENIti.ER 1,2 0S-F;1 B R t.z in 28,2009 Renewal Discussion and Action Steps GBS/City December 15,2008 Present Preliminary Renewal Numbers and GBS/City/Carriers December 15,2008 through Options January 15,2009 Present Marketing results on benefit plans to be GBS/City January 11,2009 marketed Open Enrollment meetings GBS/City/Carriers January 15 through February 15,2009 Finalize Renewal and administer plan/carrier GBS/City February 2009 changes CITY OF ELGIN Service Plan—2008 APPENDIX B Ongoing Activities: GBS ANNUAL COMPENSATION I COMMISSION% VOLUME X SERVICE/PRODUCT AND/OR FEE COMMISSION% ASSUMPTIONS Consulting Fees _j $80,000 1 1/9/2008 Gallagher Benefit Services, Inc. CITY OF ELGIN Service Plan—2008 Client Feedback and Expectations To be completed by Client. As a major client of Gallagher Benefit Services,Inc. (GBS),your thoughts and input are key to our partnership with your organization. Please provide feedback on your current GBS Service Plan,including your satisfaction level with past GBS service and expectations for the future. Please include any comments that will help GBS better meet your business needs. Your signature below acknowledges that you have reviewed your Service Plan with your GBS account representative. Who are your GBS representatives? How well does GBS respond to your business needs and expectations in the following areas? Marginally Does Not Meet Exceeds Meets Meets Expectations Does Not Expectations Expectations Expectations Apply Carrier Negotiations Financial Analysis Employee Communications General Consulting Proactive and Creative Solutions Plan Administration Overall How could GBS better respond to your business needs? Do you have any additional suggestions or comments about GBS service? Client Signature: Client Title: Date: THANK YOU FOR YOUR TIME 10 /Rk 1/9/2008 Gallagher Benefit Services, Inc. CITY OF ELGIN - SCOPE OF SERVICES ATTACHMENT A Subject to any changes and additions as may be mutually agreed by the parties, GBS will: Consulting Services Provided on an "as needed basis" Renewal analysis • Review by GBS underwriters of carrier projections • Preparation of"shadow"renewal projection • Financial modeling using proprietary Apex software • Carrier negotiation • Employee contribution modeling • Benchmarking of projected cost • Development of working rates • Assistance with budget projections • Renewal alternatives with cost impact of benefit plan changes Quarterly Financial Reports: • Comparison of plan costs to projections • Utilization review • Comparison to prior claim period • Plan trends Annual Financial Reports (End of Year Accounting): • Executive summary of program expenses • Comparison of current costs to renewal costs • Incurred But Not Reported (IBNR) claims analysis • Overview of specific Stop-loss projections • Future plan costs projections • Dollars saved by contract negotiation • Percent of benefit dollars paid by employee • Claims by size • Plan funding/budget comparison • Fixed expense comparison Legislative and Corporate Compliance Support • Provide legislative updates • Evaluate plan design to confirm compliance with state and federal regulations • Review of benefit plan documents • Conduct comprehensive review of summary plan descriptions, contracts, employee summaries, and policies/procedures to outline variances and inconsistencies which may lead to employee litigation • Ensure that COBRA processes are in compliance • Evaluate compliance with ERISA, FMLA, etc. • Technical Bulletins and the HIPAA Monitor • Training on HIPAA legislation to insure compliance with all aspects of this cumbersome law Carrier Marketing and Negotiations • Strategy development to identify goals, analyze program costs and review both current and alternative funding arrangements • Management of the renewal with the current carrier is geared to achieving lower costs. • Renewal strategy results in a management decision on whether or not to go to market to explore alternatives to the current carrier • Develop timeline covering every aspect from RFP preparation to the delivery of employee communications • Analysis of employee disruption report and preparation of geo-access report • RFP development involves tailoring the RFP to the exact desires, needs and financial directions provided management instead of using a generic RFP • Exploration of funding alternatives • Evaluation of vendor responses to identify variations in coverage and costs are identified • Conduct finalist interviews to explore intangibles such as personalities, service orientation and responsiveness • Renewal analysis report, based on renewal negotiation, covers program and claims cost projections as well as complete information on benefit designs • Finalizing decisions involves close collaboration with the GBS team and HR management Union Negotiation Assistance • Day to day administrative assistance Employee Education Programs • Facilitate focus groups • Educational meetings on coverage and trends Communication Materials • Develop Employee Satisfaction Surveys • Open Enrollment and New Hire Orientation summary information • Employee Education Programs • Employee wellness programs and education Market Benchmarking Studies • Local Area Surveys • Industry Surveys ACORD TM CERTIFICATE OF LIABILITY INSURANCE DATE(MM/DD/YYYY) 08/27/07 PRODUCER 1-630-773-3800 THIS CERTIFICATE IS ISSUED AS A MATTER OF INFORMATION Arthur J. Gallagher Risk Management Services, Inc. ONLY AND CONFERS NO RIGHTS UPON THE CERTIFICATE HOLDER. THIS CERTIFICATE DOES NOT AMEND, EXTEND OR Two Pierce Place ALTER THE COVERAGE AFFORDED BY THE POLICIES BELOW. Itasca, IL 60143 Cynthia Taylor 312-803-6361 INSURERS AFFORDING COVERAGE NAIC# INSURED INSURER A:Indian Harbor Ins Co 36940 Arthur J. Gallagher & Co., including Gallagher Benefit Services, Inc. INSURER B: The Gallagher Centre INSURER C: Two Pierce Place Itasca, IL 60143 INSURER D: INSURER E: COVERAGES THE POLICIES OF INSURANCE LISTED BELOW HAVE BEEN ISSUED TO THE INSURED NAMED ABOVE FOR THE POLICY PERIOD INDICATED.NOTWITHSTANDING ANY REQUIREMENT,TERM OR CONDITION OF ANY CONTRACT OR OTHER DOCUMENT WITH RESPECT TO WHICH THIS CERTIFICATE MAY BE ISSUED OR MAY PERTAIN,THE INSURANCE AFFORDED BY THE POLICIES DESCRIBED HEREIN IS SUBJECT TO ALL THE TERMS,EXCLUSIONS AND CONDITIONS OF SUCH POLICIES.AGGREGATE LIMITS SHOWN MAY HAVE BEEN REDUCED BY PAID CLAIMS. INSR ADD'L POLICY NUMBER POLICY EFFECTIVE POLICY EXPIRATION LTR INSRD TYPE OF INSURANCE DATE(MMIDD/YYI DATE(MM/DD/YY) LIMITS GENERAL LIABILITY _EACH OCCURRENCE $ _ COMMERCIAL GENERAL LIABILITY PR S(RENTED PRE MI E SES(Ea occurence) $ CLAIMS MADE 1 OCCUR MED EXP(Any one person) $ PERSONAL&ADVINJURY $ GENERAL AGGREGATE $ GEN'L AGGREGATE LIMIT APPLIES PER: PRODUCTS-COMP/OP AGG $ _ POLICY PRO- JECT LOC AUTOMOBILE LIABILITY ' COMBINED SINGLE LIMIT $ ANY AUTO (Ea accident) ALL OWNED AUTOS BODILY INJURY $ SCHEDULED AUTOS (Per person) HIRED AUTOS BODILY INJURY NON-OWNED AUTOS (Per accident) PROPERTY DAMAGE (Per accident) GARAGE LIABILITY AUTO ONLY-EA ACCIDENT $ _ ANY AUTO EA ACC $ OTHER THAN — AUTO ONLY: AGO_ $ EXCESS/UMBRELLA LIABILITY EACH OCCURRENCE _ $ _ OCCUR CLAIMS MADE AGGREGATE $ $ DEDUCTIBLE $ RETENTION $ $ WORKERS COMPENSATION AND WC RYUMIT- ER EMPLOYERS'LIABILITY TORY LIMITS ER ANY PROPRIETORWARTNER/EXECUTIVE E.L.EACH ACCIDENT $ OFFICER/MEMBER EXCLUDED? E.L.DISEASE-EA EMPLOYEE $ If yes,descnbe under SPECIAL PROVISIONS below E.L.DISEASE-POLICY LIMIT $ OTHER ELU09952407 A Errors & Omissions 09/01/07 09/01/08 Aggregate 20,000,000 (Claims-Made) DESCRIPTION OF OPERATIONS/LOCATIONS/VEHICLES/EXCLUSIONS ADDED BY ENDORSEMENT/SPECIAL PROVISIONS CERTIFICATE HOLDER CANCELLATION SHOULD ANY OF THE ABOVE DESCRIBED POLICIES BE CANCELLED BEFORE THE EXPIRATION For Informational Purposes Only DATE THEREOF,THE ISSUING INSURER WILL ENDEAVOR TO MAIL _ 30 DAYS WRITTEN NOTICE TO THE CERTIFICATE HOLDER NAMED TO THE LEFT,BUT FAILURE TO DO SO SHALL The Gallagher Centre IMPOSE NO OBLIGATION OR LIABILITY OF ANY KIND UPON THE INSURER,ITS AGENTS OR Two Pierce Place REPRESENTATIVES. Itasca, IL 60143 AUTHORIZED REPRESENTATIVE USA i+a.ra d i� e_ ,4,- ACORD 25(2001/08)kdaschi ©ACORD CORPORATION 1988 6885320 IMPORTANT If the certificate holder is an ADDITIONAL INSURED, the policy(ies) must be endorsed. A statement on this certificate does not confer rights to the certificate holder in lieu of such endorsement(s). If SUBROGATION IS WAIVED, subject to the terms and conditions of the policy, certain policies may require an endorsement. A statement on this certificate does not confer rights to the certificate holder in lieu of such endorsement(s). DISCLAIMER The Certificate of Insurance on the reverse side of this form does not constitute a contract between the issuing insurer(s), authorized representative or producer, and the certificate holder, nor does it affirmatively or negatively amend, extend or alter the coverage afforded by the policies listed thereon. ACORD 25(2001108) .4 ACORD ,M CERTIFICATE OF LIABILITY INSURANCE DATE(MM/DD/YYYY) 10/24/07 PRODUCER 1-630-773-3800 THIS CERTIFICATE IS ISSUED AS A MATTER OF INFORMATION Arthur J. Gallagher Risk Management Services, Inc. ONLY AND CONFERS NO RIGHTS UPON THE CERTIFICATE HOLDER. THIS CERTIFICATE DOES NOT AMEND, EXTEND OR Two Pierce Place ALTER THE COVERAGE AFFORDED BY THE POLICIES BELOW. Itasca, IL 60143 Cynthia Taylor (312) 803-6361 INSURERS AFFORDING COVERAGE NAIC# INSURED INSURER A:ARCH INS CO (A XV) 11150 Arthur J. Gallagher & Co., including Gallagher Benefit Services, Inc. INSURER B:ARCH INS CO 11150 The Gallagher Centre NSURERC:Great American Ins Co (A XIV) 16691 Two Pierce Place Itasca, IL 60143 INSURER D. INSURER E: COVERAGES THE POLICIES OF INSURANCE LISTED BELOW HAVE BEEN ISSUED TO THE INSURED NAMED ABOVE FOR THE POLICY PERIOD INDICATED.NOTWITHSTANDING ANY REQUIREMENT, TERM OR CONDITION OF ANY CONTRACT OR OTHER DOCUMENT WITH RESPECT TO WHICH THIS CERTIFICATE MAY BE ISSUED OR MAY PERTAIN,THE INSURANCE AFFORDED BY THE POLICIES DESCRIBED HEREIN IS SUBJECT TO ALL THE TERMS,EXCLUSIONS AND CONDITIONS OF SUCH POLICIES.AGGREGATE LIMITS SHOWN MAY HAVE BEEN REDUCED BY PAID CLAIMS. INSR ADD'L POLICY NUMBER POLICY EFFECTIVE POLICY EXPIRATION LIMITS LTR INSRD TYPE OF INSURANCE DATE(MMIDD/YY) DATE IMM/DD/YY) A GENERALLIABILITY 41GPP4938400 10/01/07 10/01/08 EACH OCCURRENCE $1,000,000 DAMAGE TO RENTED X COMMERCIAL GENERAL LIABILITY PREMISES(Ea occurence) $100,000 CLAIMS MADE X OCCUR MEDEXP(Anyoneperson) $5,000 X Gen Agg per loc subj. PERSONAL&ADVINJURY $1,000,000 X to $10 MIL policy agg. GENERAL AGGREGATE $3,000,000 GENL AGGREGATE LIMIT APPLIES PER: PRODUCTS-COMP/OP AGG $3,000,000 _ POLICY PRO-JECT X LOC B AUTOMOBILE LIABILITY 41CAB4938300 10/01/07 10/01/08 COMBINED SINGLE LIMIT $2,000,000 X ANY AUTO (Ea accident) ALL OWNED AUTOS BODILY INJURY $ SCHEDULED AUTOS (Per person) HIRED AUTOS BODILY INJURY $ NON-OWNED AUTOS (Per accident) X PD Comp Ded $150 PROPERTY DAMAGE X PD Coll Ded $150 (Per accident) GARAGE LIABILITY AUTO ONLY-EA ACCIDENT $ ANY AUTO OTHERTHAN EA ACC $ AUTO ONLY: AGG $ C EXCESS/UMBRELLA LIABILITY TUU5680338-00 10/01/07 10/01/08 EACH OCCURRENCE $25,000,000 X OCCUR CLAIMS MADE AGGREGATE $25,000,000 DEDUCTIBLE $ X RETENTION $ 10,000 $ A WORKERS COMPENSATION AND 41WCI4938200 10/01/07 10/01/08 X TORYLIMTS OTH- ER A EMPLOYERS'LIABILITY 41WCI4938100 10/01/08 E.L.EACH ACCIDENT $1,000,000 ANY PROPRIETOR/PARTNER/EXECUTIVE 10/01/07 OFFICER/MEMBER EXCLUDED? E.L.DISEASE-EA EMPLOYEE $1,000,000 If yes,describe under SPECIAL PROVISIONS below E.L.DISEASE-POLICY LIMIT $1,000,000 OTHER DESCRIPTION OF OPERATIONS I LOCATIONS/VEHICLES/EXCLUSIONS ADDED BY ENDORSEMENT/SPECIAL PROVISIONS CERTIFICATE HOLDER CANCELLATION SHOULD ANY OF THE ABOVE DESCRIBED POLICIES BE CANCELLED BEFORE THE EXPIRATION SAMPLE DATE THEREOF,THE ISSUING INSURER WILL ENDEAVOR TO MAIL 30 DAYS WRITTEN NOTICE TO THE CERTIFICATE HOLDER NAMED TO THE LEFT,BUT FAILURE TO DO SO SHALL Two Pierce Place IMPOSE NO OBLIGATION OR LIABILITY OF ANY KIND UPON THE INSURER,ITS AGENTS OR REPRESENTATIVES. Itasca, IL 60143 AUTHORIZED REPRESENTATIVE USAn. ACORD 25(2001108)barburr ©ACORD CORPORATION 1988 7337244 IMPORTANT If the certificate holder is an ADDITIONAL INSURED, the policy(ies) must be endorsed. A statement on this certificate does not confer rights to the certificate holder in lieu of such endorsement(s). If SUBROGATION IS WAIVED, subject to the terms and conditions of the policy, certain policies may require an endorsement. A statement on this certificate does not confer rights to the certificate holder in lieu of such endorsement(s). DISCLAIMER The Certificate of Insurance on the reverse side of this form does not constitute a contract between the issuing insurer(s), authorized representative or producer, and the certificate holder, nor does it affirmatively or negatively amend, extend or alter the coverage afforded by the policies listed thereon. ACORD 25(2001/08)