Agenda 09/27/2016 Item #16E 3 09/27/2016
EXECUTIVE SUMMARY
Recommendation to approve the purchase of Liability, Automobile, Workers' Compensation,
Aircraft,Airport and other insurance coverage for FY 2017 in the estimated amount of$928,062, a
reduction of$16,775.
OBJECTIVE: To protect the County against financial loss from casualty related claims and lawsuits
through the implementation of a cost effective,best value Casualty Insurance program.
CONSIDERATIONS: Pursuant to Florida Statutes Section 768.28 and Chapter 440, the Risk
Management Division administers two risk management funds (Fund 516 and Fund 518) to finance its
Property, Casualty and Workers' Compensation risk financing programs. Generally, the County's
deductible (self insured retention) is $300,000 per occurrence with the exception of Workers'
Compensation, which has a $500,000 per claim deductible. Claims are administered by Johns Eastern
Company. Insurance and Risk Management Services (IRMS)is the County's contracted broker of record
for coverage other than aircraft and airports. Gallagher Aviation (formerly NationAir) is the specialty
broker for aircraft and airport coverage.
The County purchases excess coverage to protect against catastrophic losses; to cover a cause of action
not limited by a state statutory tort cap (such as employment practices liability); to comply with
contractual requirements, including grants; or in the event that a claims bill is enacted pursuant to chapter
768.28, Fla. Statutes. A full marketing of the program occurs every three years. The program was last
fully marketed for the FY 2015 renewal.
For the FY 17 renewal, a Renewal Summary Sheet is attached which illustrates the pricing of each carrier
by line of coverage and the purpose/basis of each coverage. The significant highlights of the FY 2017
renewal are as follows.
❑ Ratable exposures increased on average 5.2%;however,total premium decreased 1.78%.
❑ Premium increases occurred in the Excess Workers' Compensation and Statutory Accidental
Death coverage lines. These were due solely to higher ratable payroll or covered lives. The rate
per$100 of payroll decreased 7.5%.
❑ Premium for the remaining coverage lines were either unchanged or reduced.
❑ The property insurance program renews on April 1, 2017 and is not included in this
recommendation.
❑ Flood insurance is not included in this recommendation and will be presented separately.
All carriers hold a Best's financial rating of"A, Superior"or higher.
Finally, staff has requested an appraisal on the Medflight helicopter to determine the appropriate hull
value to insure. The aircraft policy provisions state that in the event of a total loss,the carrier reserves the
right to replace the unit with one of like kind and condition. The current insured value of the hull is
$5,500,000; however, it is believed that the actual value may be significantly less. Therefore, in order to
assure that the County is not over insuring the unit, an appraisal has been requested. Staff recommends
that once the appraisal is completed, the insured value on the hull be adjusted accordingly which could
result in a premium reduction.
FISCAL IMPACT: Estimated total premiums are $928,062 which reflects a reduction in total cost of
1.78% or $16,775. Sufficient funds have been budgeted within Fund 516, Property and Casualty
insurance and Fund 518, Workers' Compensation Insurance to purchase coverage as outlined in the
PaC et.P ;1403 'I
09/27/2016
Executive Summary and Renewal Summary Sheet.
GROWTH MANAGEMENT IMPACT: There is no growth management impact associated with this
item.
LEGAL CONSIDERATIONS: This item has been reviewed by the County Attorney, is approved as
to form and legality, and requires majority vote for approval. -JAK
RECOMMENDATION: It is recommended that the Board of County Commissioners approves the
following:
1)The purchase of coverage as outlined in the Executive Summary and the Renewal Summary Sheet
effective October 1,2016.
2)The rejection of Uninsured Motorist Insurance with the exception of scheduled take home vehicles,
authorizing the County Manager or designee to execute the necessary rejection forms.
3) The adjustment of the insured hull value of the Medflight helicopter subject to the finding of the
certified aircraft appraiser.
3) Authorizing the County Manager or designee to complete the applications or other documents
necessary to bind coverage and services effective October 1,2016.
Prepared by:Jeffrey A. Walker, CPCU,ARM,Division Director,Risk Management Division
ATTACHMENTS)
1.Renewal Summary FY 17 (PDF)
140
16.E.3
09/27/2016
COLLIER COUNTY
Board of County Commissioners
Item Number: 16.E.3
Item Summary: Recommendation to approve the purchase of Liability, Automobile, Workers'
Compensation, Aircraft, Airport and other insurance coverage for FY 2017 in the estimated amount of
$928,062.
Meeting Date: 09/27/2016
Prepared by:
Title: Division Director-Risk Management—Risk Management
Name: Jeff Walker
08/22/2016 3:12 PM
Submitted by:
Title: Division Director-Risk Management—Risk Management
Name: Jeff Walker
08/22/2016 3:12 PM
Approved By:
Review:
Administrative Services Department Pat Pochopin Level 1 Division Reviewer Completed 08/25/2016 11:35 AM
County Attorneys Office Colleen Greene Level 2 Attorney Review Completed 08/25/2016 2:15 PM
Administrative Services Department Len Price Level 2 Division Administrator Review Completed 09/07/2016 7:23 PM
Office of Management and Budget Valerie Fleming Level 3 OMB Gatekeeper Review Completed 09/08/2016 2:34 PM
Office of Management and Budget Laura Wells Level 3 OMB 1st Reviewer 1-4 Completed 09/08/2016 3:43 PM
County Attorneys Office Jeffrey A.Klatzkow Level 3 County Attorney's Office Review Completed 09/14/2016 10:04 AM
County Manager's Office Nick Casalanguida Level 4 County Manager Review Completed 09/18/2016 10:15 PM
Board of County Commissioners MaryJo Brock Meeting Pending 09/27/2016 9:00 AM
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