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Agenda 09/14/2021 Item #16E 9 (Purchase Aircraft & Airport Insurance for FY 2022 from Member Companies of Global Aerospace)09/14/2021 EXECUTIVE SUMMARY Recommendation to approve the purchase of Aircraft and Airport Insurance for FY 2022 from the Member Companies of Global Aerospace in the annual amount of $212,437. OBJECTIVE: To protect the County against financial loss arising from Aircraft and Airport related claims and to comply with Federal Aviation Administration requirements as well as other contractual requirements. CONSIDERATIONS: Collier County operates three airports that include Marco Island Airport, Immokalee Airport and Everglades Airpark. The County EMS Division operates Med Flight helicopter (N911CK) and Med Flight helicopter (N911CB) for the purpose of emergency medical transport pursuant to FAA Part 135 Regulations. The County is required to carry Airport Liability insurance on its airports and hangar facilities to comply with various contractual requirements and Aircraft Liability insurance in order to receive landing permission at various hospital/medical facilities. Further, the County purchases Aircraft Hull insurance to protect against damage to aircraft. Currently, these policies are underwritten by Global Aerospace and will expire on September 30, 2021. In anticipation of the policy expiration, renewal proposals were sought through the County’s aviation insurance broker, Arthur J. Gallagher Aviation. The worldwide aviation insurance market has tightened significantly over the past 48 months. The number of carriers writing aviation coverage has contracted significantly due to severe losses and due to COVID concerns. Rates are increasing as much as 30% in many sectors of the business. According to the broker, public entity EMS Helicopter insurance is particularly difficult to place. The County’s aviation insurance broker approached ten carriers and received proposals from two carriers. The two carriers were Ace/Chubb/Westchester and Global Aerospace, the incumbent. Global Aerospace group agreed to renew the business and to offer the same coverage terms at renewal. The Ace/Chubb/Westchester proposal was $27,159 greater than the Global Aerospace proposal and contained several coverage reductions. A full Proposal of Insurance is attached as part of this Item. Given these considerations, the broker and the Risk Management Director recommends that the County renew with Global Aerospace. The FY 22 renewal is illustrated below: Policy Type Limits Deductibles FY 21 Premium FY 22 Premium Dollar Change Percent Change Aircraft Liability $30,000,000 Each Occurrence None Incl. with Hull Incl. with Hull NA NA Aircraft Hull $1,592,000 Insured Value N911CK $8,000,000 Insured Value N911CB $1,000- Rotors Not in Motion; 2.5% of Insured Value- Rotors in Motion $173,074 $199,901 $26,827 15.5% Airport Liability $2,000,000 Each Occurrence None $10,275 $12,536 $2,407 22.0% Total $183,349 $212,437 $29,085 15.8% Less Safety/Accident- Free Dividend* ($18,172) ($20,900) NET COST $165,177 $191,447 *Dividend is paid if the insured remains accident free for the policy period. The Member Companies of Global Aerospace carry a Best’s financial rating of “A, Superior” or greater. 16.E.9 Packet Pg. 2732 09/14/2021 The commencement date of coverage is October 1, 2021. FISCAL IMPACT: The estimated annual premium for Aircraft (N911CK), Aircraft (N911CB) and Airport Liability Insurance is $212,437. Sufficient funds have been budgeted within Fund 516, Property Casualty Insurance to purchase coverage. GROWTH MANAGEMENT IMPACT: There is no growth management impact associated with this item. LEGAL CONSIDERATIONS: This item has been reviewed by the Count Attorney, raises no legal issues and requires majority vote for approval. -JAK RECOMMENDATION: To approve the purchase of Aircraft and Airport Insurance as outlined in the Executive Summary effective October 1, 2021 and authorize the County Manager or designee to complete the applications or other documents necessary to bind coverage through the aviation insurance broker, Arthur J. Gallagher Aviation. Prepared by: Jeffrey A. Walker, CPCU, ARM, Division Director, Risk Management Division ATTACHMENT(S) 1. 21-22 Aircraft Hull and Liability Aviation General Liability - renewal proposal (PDF) 2. 2021 Aviation Market Update (PDF) 3. Correspondence from Gallagher Scott Bolger (PDF) 16.E.9 Packet Pg. 2733 09/14/2021 COLLIER COUNTY Board of County Commissioners Item Number: 16.E.9 Doc ID: 17748 Item Summary: Recommendation to approve the purchase of Aircraft and Airport Insurance for FY 2022 from the Member Companies of Global Aerospace in the annual amount of $212,437. Meeting Date: 09/14/2021 Prepared by: Title: Division Director - Risk Management – Risk Management Name: Jeff Walker 08/10/2021 2:09 PM Submitted by: Title: Division Director - Risk Management – Risk Management Name: Jeff Walker 08/10/2021 2:09 PM Approved By: Review: Agenda Clerk Preview Michael Cox Agenda Clerk Preview Completed 08/18/2021 7:54 AM Risk Management Jeff Walker Director Review Completed 08/18/2021 7:58 AM County Attorney's Office Jeffrey A. Klatzkow Level 3 County Attorney's Office Review Completed 08/18/2021 8:16 AM Office of Management and Budget Debra Windsor Level 3 OMB Gatekeeper Review Completed 08/18/2021 11:07 AM Office of Management and Budget Laura Wells Additional Reviewer Completed 08/18/2021 4:08 PM County Manager's Office Sean Callahan Level 4 County Manager Review Completed 09/07/2021 4:16 PM Board of County Commissioners Geoffrey Willig Meeting Pending 09/14/2021 9:00 AM 16.E.9 Packet Pg. 2734 ajg.com 2021 Arthur J. Gallagher & Co. All rights reserved. Proposal of Insurance Scott Bolger, CPCU, ARM Area Executive Vice President Arthur J. Gallagher Risk Management Services, Inc. 2580 Foxfield Road Suite 203 Saint Charles, IL 60174 Collier County Board of County Commissioners 3311 East Tamiami Trail, Bldg D Naples, FL 34112 Presented: August 10, 2021 Effective: October 1, 2021 to October 1, 2022 16.E.9.a Packet Pg. 2735 Attachment: 21-22 Aircraft Hull and Liability Aviation General Liability - renewal proposal (17748 : Approval to purchase Aircraft and Airport Collier County Board of County Commissioners 2021 Arthur J. Gallagher & Co. All rights reserved. 2 Table of Contents Table of Contents.............................................................................................................................................................. 2 Service Team .................................................................................................................................................................... 3 Service Commitment ........................................................................................................................................................ 4 Program Structure ................................................................................................................................................................ 5 Named Insureds ................................................................................................................................................................ 6 Marketplace Review .......................................................................................................................................................... 7 Summary of Significant Coverage Changes .................................................................................................................... 8 Coverage Highlights ............................................................................................................................................................. 9 Premium Summary ......................................................................................................................................................... 20 Carrier Ratings and Admitted Status .............................................................................................................................. 21 Coverages for Consideration.......................................................................................................................................... 22 Compensation Disclosure Schedule .............................................................................................................................. 23 Claims Reporting By Policy ............................................................................................................................................ 24 Client Authorization to Bind Coverage ........................................................................................................................... 25 16.E.9.a Packet Pg. 2736 Attachment: 21-22 Aircraft Hull and Liability Aviation General Liability - renewal proposal (17748 : Approval to purchase Aircraft and Airport Collier County Board of County Commissioners 2021 Arthur J. Gallagher & Co. All rights reserved. 3 Service Team Scott Bolger, CPCU, ARM has primary service responsibility for your company. We operate using a team approach. Your Service Team consists of: NAME / TITLE PHONE / ALT. PHONE EMAIL Scott Bolger, CPCU, ARM Area Execu tive Vice President 847-586-0802 (p) 866-212-1654(f) 847-902-8108(c) Scott_Bolger@ajg.com Jennifer Cummins Client Service Manager 630-549-3629(p) 866-212-1654(f) Jennifer_Cummins@ajg.com Tom Surgalski Claims Advocate 630-549-3611(p) 866-212-1654(f) Tom_Surgalski@ajg.com Arthur J. Gallagher Risk Management Services, Inc. Phone Number: (630) 584-7552 16.E.9.a Packet Pg. 2737 Attachment: 21-22 Aircraft Hull and Liability Aviation General Liability - renewal proposal (17748 : Approval to purchase Aircraft and Airport Collier County Board of County Commissioners 2021 Arthur J. Gallagher & Co. All rights reserved. 4 Service Commitment Account Service At Arthur J. Gallagher & Co., our goal is to provide you with an exceptional insurance and risk management program delivered by a world class service organization. Gallagher is committed to partnering with our clients to ensure we consistently deliver the highest quality service possible. Renewals We use a standard Renewal Timeline and start early to make sure your needs are met and we are able to offer you the most comprehensive and competitively priced insurance program. At each renewal, we will meet with you to establish a renewal game plan, determine how many markets should be approached, discuss pricing in the insurance marketplace, and identify what specific needs must be addressed. We will then approach markets that we feel will offer the best altern atives. These alternatives will be presented at renewal as an option, even if we feel the incumbent program is strongest. We will demonstrate how we have created competition within the marketplace to ensure that you receive the best renewal terms. We make ourselves accountable by working with you to develop a written service schedule that meets your needs. You can track our service by referring to our written service commitment. Service becomes especially important as your type of organization continues to change and prosper. As a top national broker, we have access to over 150 insurance companies and wholesalers. This maximizes your insurance options in any given policy year situation. In addition, our integrity and influence in the marketplace have resulted in excellent relationships with our markets. These factors are especially important to consider as the insurance needs of your organization become more complex and require more sophisticated solutions. 16.E.9.a Packet Pg. 2738 Attachment: 21-22 Aircraft Hull and Liability Aviation General Liability - renewal proposal (17748 : Approval to purchase Aircraft and Airport Collier County Board of County Commissioners 2021 Arthur J. Gallagher & Co. All rights reserved. 5 Program Structure 16.E.9.a Packet Pg. 2739 Attachment: 21-22 Aircraft Hull and Liability Aviation General Liability - renewal proposal (17748 : Approval to purchase Aircraft and Airport Collier County Board of County Commissioners 2021 Arthur J. Gallagher & Co. All rights reserved. 6 Named Insureds NAMED INSUREDS LINE OF COVERAGE (LOC) Collier County Board of County Commissioners your boards, commissions, or agencies and their elective officers or members thereof Aircraft Hull and Liability Aviation General Liability Note: Any entity not named in this proposal, may not be an insured entity. This may include affiliates, subsidiaries, LLC's, partnerships and joint ventures. 16.E.9.a Packet Pg. 2740 Attachment: 21-22 Aircraft Hull and Liability Aviation General Liability - renewal proposal (17748 : Approval to purchase Aircraft and Airport Collier County Board of County Commissioners 2021 Arthur J. Gallagher & Co. All rights reserved. 7 Marketplace Review We approached the following carriers in an effort to provide the most comprehensive and cost effective insurance program. CARRIER LINE OF COVERAGE CARRIER POSITION Member Companies of Global Aerospace Aircraft Hull and Liability Aviation General Liability Quoted National Union Fire Insurance Company of Pittsburgh, PA Aircraft Hull and Liability Aviation General Liability No Response Chubb Group of Insurance Companies Aircraft Hull and Liability Aviation General Liability Quoted Allianz Global Risks US Insurance Company Aircraft Hull and Liability Aviation General Liability Declination – Quota Share Only Member Companies of USAIG Aircraft Hull and Liability Aviation General Liability Declination – Quota Share Only Old Republic Insurance Company Aircraft Hull and Liability Aviation General Liability Declination – Quota Share Only QBE Insurance Corporation Aircraft Hull and Liability Aviation General Liability Declination Endurance American Insurance Company Aircraft Hull and Liability Aviation General Liability Declination AXAXL Aircraft Hull and Liability Aviation General Liability No Response Starr Indemnity & Liability Company Aircraft Hull and Liability Aviation General Liability Declination - Quota Share only 16.E.9.a Packet Pg. 2741 Attachment: 21-22 Aircraft Hull and Liability Aviation General Liability - renewal proposal (17748 : Approval to purchase Aircraft and Airport Collier County Board of County Commissioners 2021 Arthur J. Gallagher & Co. All rights reserved. 8 Summary of Significant Coverage Changes Important: This Highlight is only an outline of the changes compared to your current coverage since your last renewal. It does not include all of the changes in terms, coverages, exclusions, limitations and conditions. YOU MUST READ THE POLICY FOR THOSE DETAILS. LINE OF BUSINESS COVERAGE EXPIRING POLICY CURRENT POLICY Aircraft Hull & Liability None Airport General Liability None 16.E.9.a Packet Pg. 2742 Attachment: 21-22 Aircraft Hull and Liability Aviation General Liability - renewal proposal (17748 : Approval to purchase Aircraft and Airport Collier County Board of County Commissioners 2021 Arthur J. Gallagher & Co. All rights reserved. 9 Coverage Highlights 16.E.9.a Packet Pg. 2743 Attachment: 21-22 Aircraft Hull and Liability Aviation General Liability - renewal proposal (17748 : Approval to purchase Aircraft and Airport Collier County Board of County Commissioners 2021 Arthur J. Gallagher & Co. All rights reserved. 10 Coverage Highlights Coverage: Aircraft Physical Damage and Liability Carrier: Option 1: Member Companies of Global Aerospace Option 2: Westchester Fire Insurance Company Policy Period: October 1, 2021 to October 1, 2022 The following is a general summary of the Insuring Agreement. Refer to actual policy form for complete terms and conditions. Aircraft Schedule Aircraft Registration Number Seats 1999 Eurocopter EC 135T1 N911CK 1 + 5 2019 Eurocopter H135 T3H N911CB 1 + 3 Aircraft Coverage Reg. Number Insured Value1 Coverage Hull Premium Hull War Premium Limit of Liability Each Occurrence Liability Premium War Limit of Liability2 Third Party War Limit of Liability War Premium Total Premium N911CK $1,592,000 Ground and Flight $76,045 Included $30,000,000 $12,528 $30,000,000 $30,000,000 Included $107,328 N911CB $8,000,000 Ground and Flight $92,800 Included $30,000,000 $12,528 $30,000,000 $30,000,000 Included $90,573 1 Valuation – Agreed Insured Value basis. Other Aircraft Coverage Reg. Number Medical Limit Deductibles/SIR Each Passenger Each Crew Member Premium Not in Motion In Motion N911CK $25,000 $25,000 $0 $1,000 ($5,000 for ACE) $39,800 ($47,760 for ACE) N911CB $25,000 $25,000 Included $1,000 ($5,000 for Westchester) $200,000 ($240,000 for Westchester) 16.E.9.a Packet Pg. 2744 Attachment: 21-22 Aircraft Hull and Liability Aviation General Liability - renewal proposal (17748 : Collier County Board of County Commissioners 2021 Arthur J. Gallagher & Co. All rights reserved. 11 Approved Use All Operations of the Named Insured Pilot Provisions The policy shall not apply while a scheduled aircraft is in flight unless operated by: Open Pilot Provisions: Any appropriately rated pilot approved by the Chief Pilot of the Named Insured or their designee. Policy Territory Worldwide Liability Coverage Coverage Limit Liability for the use of temporary substitute aircraft Each Occurrence $30,000,000 Maximum Number of Seats 40 Liability for the use of non-owned aircraft Each Occurrence $30,000,000 Maximum Number of Seats 40 Grace Period - Number of Days 30 Liability for property damage to substitute aircraft Each Occurrence $5,500,000 Deductible None Maximum Number of Seats 40 Liability for property damage to non-owned aircraft Each Occurrence $5,500,000 Deductible None Maximum Number of Seats 40 Liability for the use of aviation premises Each Occurrence $30,000,000 Liability for non-owned hangars and their contents Each Occurrence $4,000,000 (Not provided by Westchster) 16.E.9.a Packet Pg. 2745 Attachment: 21-22 Aircraft Hull and Liability Aviation General Liability - renewal proposal (17748 : Collier County Board of County Commissioners 2021 Arthur J. Gallagher & Co. All rights reserved. 12 Liability Coverage Coverage Limit Liability for personal effects and baggage expense Each Passenger $50,000 (Not provided by Westchster) Each Crew Member $50,000 (Not provided by Westchster) Deductible None Liability for the sale of aircraft Each Occurrence $30,000,000 Passenger voluntary settlement including crew Each Passenger $1,000,000 ($250,000 for Westchester) Each Crew Member $1,000,000 ($250,000 for Westchester) Each Occurrence $6,000,000 ($1,250,000 for Westchester) Maximum Weekly 1000 Maximum Period - Weeks 52 Liability for personal injury Each Occurrence $25,000,000 Liability under contractual agreements Each Occurrence $30,000,000 Liability for hangarkeepers operations Each Occurrence $10,000,000 (Not provided by Westchster) Liability for garagekeepers Any One Auto $1,000,000 (Not provided by Westchster) Any One Loss $1,000,000 (Not provided by Westchster) 16.E.9.a Packet Pg. 2746 Attachment: 21-22 Aircraft Hull and Liability Aviation General Liability - renewal proposal (17748 : Collier County Board of County Commissioners 2021 Arthur J. Gallagher & Co. All rights reserved. 13 Liability Coverage Coverage Limit Liability for the operation of an auto while on airport premises Each Occurrence $30,000,000 Liability for cargo Each Occurrence $1,000,000 Deductible None Liability for the operation of mobile equipment Each Occurrence $30,000,000 Liability for newly acquired aircraft Each Occurrence $30,000,000 Number of Seats 6 Grace Period - Number of Days 60 *Some of the limits scheduled herein may be part of, and not in addition to, the policy limit. Please refer to the actual policy. Physical Damage Coverage Coverage Limit Physical damage coverage for spare engines Each Occurrence $2,000,000 ($1,000,000 for Westchester) Deductible None Physical damage coverage for mechanics tools Each Loss $180,000 (Not provided by Westchster) Deductible $500 Physical damage coverage for increased value of scheduled aircraft Each Aircraft $20,000,000 Deductible None Automatic insurance for newly acquired aircraft Each Occurrence $20,000,000 Number of Days to Report 60 Maximum Seats 6 16.E.9.a Packet Pg. 2747 Attachment: 21-22 Aircraft Hull and Liability Aviation General Liability - renewal proposal (17748 : Collier County Board of County Commissioners 2021 Arthur J. Gallagher & Co. All rights reserved. 14 Medical Expenses Coverage Limit With respect to any temporary substitute aircraft Each Passenger $25,000 Each Crew Member $25,000 With respect to any non-owned aircraft Each Passenger $25,000 Each Crew Member $25,000 With respect to any aviation premises Each Person $25,000 Each Occurrence $800,000 Additional Coverage Coverage Limit Temporary replacement aircraft rental expense Each Loss $900,000 ($1,000,000 for Westchester) Minimum Number of Days 0 Maximum Number of Days 60 Temporary replacement parts rental expenses Each Loss $200,000 ($500,000 for Westchester) Minimum Number of Days 0 Maximum Number of Days 60 Search and rescue expense Each Loss $1,000,000 (Not provided by Westchster) Runway foaming and crash control expense 16.E.9.a Packet Pg. 2748 Attachment: 21-22 Aircraft Hull and Liability Aviation General Liability - renewal proposal (17748 : Collier County Board of County Commissioners 2021 Arthur J. Gallagher & Co. All rights reserved. 15 Additional Coverage Coverage Limit Each Occurrence $1,000,000 (Not provided by Westchster) Emergency and unexpected landing expense Each Occurrence $1,000,000 (Not provided by Westchster) Trip interruption expense Each Passenger $10,000 (Not provided by Westchster) Each Crew Member $10,000 (Not provided by Westchster) Lay-Up credit for scheduled aircraft Percentage 50% (Not provided by Westchster) Number of Days 30 Applies to physical damage and liability premium Profit commission Included in Policy 15% OF 70% (Not provided by Westchster) Hurricane relocation expense Each Occurrence $500 *Some of the limits scheduled herein may be part of, and not in addition to, the policy limit. Please refer to the actual policy. Significant Endorsements (included but not limited to) As outlined above Additional Insured City of Naples Airport Authority Phillips 66 Company Turbomeca USA, Inc. Safran Helicopter Engines 16.E.9.a Packet Pg. 2749 Attachment: 21-22 Aircraft Hull and Liability Aviation General Liability - renewal proposal (17748 : Collier County Board of County Commissioners 2021 Arthur J. Gallagher & Co. All rights reserved. 16 Jupiter Health NCH Healthcare System, Inc. Significant Exclusions (included but not limited to) TRIA Terrorism (unless endorsed) Workers’ Compensation and Employers’ Liability Wear and Tear / Deterioration Mechanical Breakdown Conversion / Embezzlement Data Event Exclusion Binding Requirements Signed Client Authorization to Bind Premium / Taxes / Fees Expiring Premium Global Aerospace Renewal Premium Option 1 ACE USA Renewal Premium Option 2 Policy Total Annual Premium $173,074 $199,901 $232,096 +15.5% +34.1% TRIA $4,743 $1,824 16.E.9.a Packet Pg. 2750 Attachment: 21-22 Aircraft Hull and Liability Aviation General Liability - renewal proposal (17748 : Collier County Board of County Commissioners 2021 Arthur J. Gallagher & Co. All rights reserved. 17 Coverage Highlights Coverage: Aviation General Liability Carrier: Option 1: Member Companies of Global Aerospace Option 2: ACE Property and Casualty Insurance Company Policy Period: October 1, 2021 to October 1, 2022 The following is a general summary of the Insuring Agreement. Refer to actual policy form for complete terms and conditions. Premise Marco Island Executive - MKY - 2005 Mainsail Drive, Naples, FL Immokalee Regional Airport - KIMM - Immokalee, FL Everglades Airpark - X01 - Everglades City, FL And any location owned, rented or occupied by the named insured and any location incidental to the operation of the named insured. Aviation General Liability Coverage Coverage Limit Premise liability Each Occurrence $2,000,000 Products completed operations liability Each Occurrence $2,000,000 Aggregate $2,000,000 Premise medical payments Each Person $5,000 Each Occurrence $100,000 Hangarkeeper's legal liability Each Aircraft $2,000,000 Each Occurrence $2,000,000 Hangarkeepers Liability Deductible None Property damage deductibles Aircraft Deductible None Non Aircraft Deductible None 16.E.9.a Packet Pg. 2751 Attachment: 21-22 Aircraft Hull and Liability Aviation General Liability - renewal proposal (17748 : Collier County Board of County Commissioners 2021 Arthur J. Gallagher & Co. All rights reserved. 18 Additional Coverage Coverage Limit Contractual liability Each Occurrence $2,000,000 Deductible None Reporting Provision 30 Days War risk liability Each Occurrence $2,000,000 Non-owned aircraft liability Each Occurrence $2,000,000 Deductible None Maximum Aircraft Seating 20 Seats Reporting Provision 30 Days *Some of the limits scheduled herein may be part of, and not in addition to, the policy limit. Please refer to the actual policy. Significant Endorsements (included but not limited to) As outlined Above - Additional Insured Shell Aviation, dba Shell Oil Products Company U.S., LLC and Titan Aviation Fuels - Commercial Leasing Corporation The Hiller Group, Inc. NetJets, Inc. Significant Exclusions (included but not limited to) TRIA Terrorism (unless endorsed) - Workers’ Compensation and Employers’ Liability - Employment Related Practices Fellow Employee (unless endorsed) Bodily Injury and Property Damage Arising out of “Your Product” or “Your Work” (unless endorsed) Data Event Exclusion 16.E.9.a Packet Pg. 2752 Attachment: 21-22 Aircraft Hull and Liability Aviation General Liability - renewal proposal (17748 : Collier County Board of County Commissioners 2021 Arthur J. Gallagher & Co. All rights reserved. 19 Binding Requirements Signed Client Authorization to Bind - Auditable / Frequency This policy is subject to an annual audit. Premium / Taxes / Fees Expiring Premium Global Aerospace Renewal Premium Option 1 ACE USA Renewal Premium Option 2 Policy Total Annual Premium $10,275 $12,536 $7,500 +22% -27% TRIA $926 $750 16.E.9.a Packet Pg. 2753 Attachment: 21-22 Aircraft Hull and Liability Aviation General Liability - renewal proposal (17748 : Collier County Board of County Commissioners 2021 Arthur J. Gallagher & Co. All rights reserved. 20 Premium Summary COVERAGE Expiring Premium Global Aerospace Renewal Premium Option 1 ACE USA Renewal Premium Option 2 Aircraft Hull & Liability Insurance $173,074 $199,901 $232,096 Airport Liability Insurance $10,275 $12,536 $7,500 TOTAL ANNUAL PREMIUM $183,349 $212,437 +15.8% $239,596 +30.6% Less Profit Commission Dividend (Maximum) ($18,172) ($20,990) ($0) NET COST $165,177 $191,447 $239,596 Quote from Member Companies of Global Aerospace is valid until October 1, 2021. Premiums are due and payable as billed and may be financed, subject to acceptance by an approved finance company. Following acceptance, completion (and signature) of a premium finance agreement with the specified down payment is required. Note: Unless prohibited by law, Gallagher may earn compensation for this optional value-added service. Gallagher Aviation is responsible for the placement of the following lines of coverage: Aircraft Hull and Liability, Aviation General Liability It is understood that any other type of exposure/coverage is either self-insured or placed by another brokerage firm other than Gallagher. If you need help in placing other lines of coverage or covering other types of exposures, please contact your Gallaher representative. 16.E.9.a Packet Pg. 2754 Attachment: 21-22 Aircraft Hull and Liability Aviation General Liability - renewal proposal (17748 : Collier County Board of County Commissioners 2021 Arthur J. Gallagher & Co. All rights reserved. 21 Carrier Ratings and Admitted Status PROPOSED INSURANCE COMPANIES A.M. BEST'S RATING & FINANCIAL SIZE CATEGORY * ADMITTED/NON - ADMITTED ** ACE Property & Casualty Insurance Company / Westchester Fire Insurance Company A+, XV Admitted Member Companies of Global Aerospace American Alternative Insurance Corporation (59.24%) A+, XV Admitted American Commerce Insurance Company (10%) A, XIV Admitted National Indemnity Company of the South (18.39%) A+, XV Admitted Tokio Marine America Insurance Company (12.37%) A, XV Admitted *Gallagher companies use A.M. Best rated insurers and the rating listed above was verified on the date the proposal document was created. Best's Credit Ratings™ reproduced herein appear under license from A.M. Best and do not constitute, either expressly or impliedly, an endorsement of Gallagher’s service or its recommendations. A.M. Best is not responsible for transcription errors made in presenting Best's Credit Ratings™. Best’s Credit Ratings™ are proprietary and may not be reproduced or distributed without the express written permission of A.M. Best. A Best’s Financial Strength Rating is an independent opinion of an insurer’s financial strength and ability to meet its ongoing insurance policy and contract obligations. It is not a warranty of a company’s financial strength and ability to meet its obligations to policyholders. Best's Credit Ratings™ are under continuous review and subject to change and/or affirmation. For the latest Best’s Credit Ratings™ and Guide to Best’s Credit Ratings, visit the A.M. Best website at http://www.ambest.com/ratings. **If coverage placed with a non-admitted carrier, it is doing business in the state as a surplus lines or non-admitted carrier, and is neither subject to the same regulations as an admitted carrier nor do they participate in any state insurance guarantee fund. Gallagher companies make no representations and warranties concerning the solvency of any carrier, nor does it make any representation or warranty concerning the rating of the carrier which may change. 16.E.9.a Packet Pg. 2755 Attachment: 21-22 Aircraft Hull and Liability Aviation General Liability - renewal proposal (17748 : Approval to purchase Aircraft and Airport Collier County Board of County Commissioners 2021 Arthur J. Gallagher & Co. All rights reserved. 22 Coverages for Consideration Overview • A proposal for any of the coverages can be provided. • The recommendations and consideration summarized in this section are not intended to identify all exposures. • Since Gallagher does not handle your complete insurance program, these recommendations only reflect items within our scope of responsibility. Internet Liability 16.E.9.a Packet Pg. 2756 Attachment: 21-22 Aircraft Hull and Liability Aviation General Liability - renewal proposal (17748 : Approval to purchase Aircraft and Airport Collier County Board of County Commissioners 2021 Arthur J. Gallagher & Co. All rights reserved. 23 Compensation Disclosure Schedule Client Name: Collier County Board of County Commissioners COVERAGE(S) CARRIER NAME(S) WHOLESALER, MGA OR INTERMEDIARY NAME 1 EST ANNUAL PREMIUM 2 COMM. % OR FEE 3 GALLAGHER U.S. owned WHOLESALER, MGA or INTERMEDIARY % Aircraft Hull and Liability Member Companies of Global Aerospace Global Aerospace $199,901 15% N/A Aviation General Liability Member Companies of Global Aerospace Global Aerospace $12,536 20% N/A Aircraft Hull and Liability Westchester Fire Insurance Co ACE Aerospace $232,096 15% N/A Aviation General Liability ACE Property & Casualty Co ACE Aerospace $7,500 15% N/A 1. We were able to obtain more advantageous terms and conditions for you through an intermediary/ wholesaler. 2. If the premium is shown as an indication: The premium indicated is an estimate provided by the market. The actual premium and acceptance of the coverage requested will be determined by the market after a thorough review of the completed application. * A verbal quotation was received from this carrier. We are awaiting a quotation in writing. 3. The commission rate is a percentage of annual premium excluding taxes & fees. * Gallagher is receiving ___% commission on this policy. The fee due Gallagher will be reduced by the amount of the commissions received. 16.E.9.a Packet Pg. 2757 Attachment: 21-22 Aircraft Hull and Liability Aviation General Liability - renewal proposal (17748 : Collier County Board of County Commissioners 2021 Arthur J. Gallagher & Co. All rights reserved. 24 Claims Reporting By Policy Immediately report all claims. Direct Reporting Immediately report all claims for the following lines of coverage to the insurance carrier.  Aircraft Hull and Liability Kevin Twiss, Global Aerospace Claims Manager Direct #770 -634 -8701 ttwiss@global-aero.com  Aviation General Liability Nancy Karlen, Global Aerospace Senior Claims Representative Manager Direct #404 -918 -0174 nkarlen@global-aero.com 16.E.9.a Packet Pg. 2758 Attachment: 21-22 Aircraft Hull and Liability Aviation General Liability - renewal proposal (17748 : Approval to purchase Aircraft and Airport Collier County Board of County Commissioners 2021 Arthur J. Gallagher & Co. All rights reserved . 25 Client Authorization to Bind Coverage After careful consideration of Gallagher’s proposal dated August 10, 2021, we accept the following coverage(s). Please check the desired coverage(s): COVERAGE/CARRIER DESCRIPTION / MAJOR DIFFERENCES Aircraft Hull and Liability ☐ Accept ☐ Reject Global Aerospace $199,901 Annual Premium ☐ Accept ☐ Reject TRIA - $4,743 Additional Premium ☐ Accept ☐ Reject Westchester Fire Insurance Co - $232,096 Annual Premium ☐ Accept ☐ Reject TRIA - $1,824 Additional Premium Aviation General Liability ☐ Accept ☐ Reject Global Aerospace $12,536 Annual Premium ☐ Accept ☐ Reject TRIA - $926 Additional Premium ☐ Accept ☐ Reject ACE Property & Casualty Insurance Co - $7,500 Annual Premium ☐ Accept ☐ Reject TRIA - $750 Additional Premium The above coverage may not necessarily represent the entirety of available insurance products. If you are interested in pursuing additional coverages other than those addressed in the coverage considerations included in this proposal, please list below: _____________________________________________________________________________________________ Producer/ Insured Coverage Amendments and Notes: EXPOSURES AND VALUES We confirm the payroll, values, schedules, and other data contained in the proposal, and submitted to the underwriters, are compiled from our records and we acknowledge it is our responsibility to see that they are maintained accurately. If no updates were provided to Gallagher, the values, exposures and operations used were based on the expiring policies. Provide Quotations or Additional Information on the Following Coverage Considerations: Gallagher recommends that you purchase the following additional coverages for which you have exposure. By rejecting a quotation for this valuable coverage, you understand that there will be no coverage and agree to hold Gallagher harmless in the event of a loss. Other Coverages to Consider ☐ Yes ☐ No - Cyber Liability 16.E.9.a Packet Pg. 2759 Attachment: 21-22 Aircraft Hull and Liability Aviation General Liability - renewal proposal (17748 : Approval to purchase Aircraft and Airport Collier County Board of County Commissioners 2021 Arthur J. Gallagher & Co. All rights reserved. 26 Gallagher’s liability to Client arising from any acts or omissions of Gallagher shall not exceed $20 million in the aggregate. Gallagher shall only be liable for actual damages incurred by Client, and shall not be liable for any indirect, consequential or punitive damages or attorneys’ fees. No claim or cause of action, regardless of form (tort, contract, statutory, or otherwise), arising out of, relating to or in any way connected with this Agreement or any Services provided hereunder may be brought by either party any later than two (2) years after the accrual of such claim or cause of action. Gallagher has established security controls to protect Client confidential information from unauthorized use or disclosure. For additional information, please review Gallagher’s Privacy Policy located at https://www.ajg.com/privacy-policy/. I have read, understand and agree that the above-information is correct and has been disclosed to us prior to authorizing Gallagher to bind coverage and/or provide services to us. By: _______________________________________________________________________ Print Name (Specify Title) _______________________________________________________________________ Company _______________________________________________________________________ Signature Date: _______________________________________________________________________ 16.E.9.a Packet Pg. 2760 Attachment: 21-22 Aircraft Hull and Liability Aviation General Liability - renewal proposal (17748 : Approval to purchase Aircraft and Airport 1©2019 ARTHUR J. GALLAGHER & CO. | AJG.COM 18GGB29618X-Strat Rev Aviation Insurance Market Update –2021 Claims: ◼Boeing 737 Max –Estimated at $1.5-$3.0 Billion ◼Kobe Bryant –Estimated at $50MM+ ◼U,.S. Tornado and Hurricane Losses in 2020 -$250MM+ ◼Aircraft Hull Claims Increasing Dramatically: 1980’s -$25,000 Average Loss -$8MM Shock Loss 1990’s –$40,000 Average Loss -$15MM Shock Loss 2000’s -$75,000 Average Loss -$25MM Shock Loss 2010’s -$100,000 Average Loss -$60MM Shock Loss 16.E.9.b Packet Pg. 2761 Attachment: 2021 Aviation Market Update (17748 : Approval to purchase Aircraft and Airport Insurance 2©2019 ARTHUR J. GALLAGHER & CO. | AJG.COM 18GGB29618X-Strat Rev Aviation Insurance Market Update –2021 ◼Aviation Market still difficult but seems to be flattening. Hurricane and tornado losses in 2020 caused in excess of $250MM of damage to aircraft. Insurers beginning to enforce minimum premium on airlines in addition to 20%+ increases. ◼Underwriting discipline remains in the marketplace. Is still “extreme” underwriting. ◼Aviation insurers controlling their capacity on ALL LINES of coverage. Risks such as owner flown aircraft, single pilot corporate aircraft, commercial helicopters, critical aircraft parts, or accounts with systemic loss histories are seeing increases of 50% plus. ◼Many insurers reducing ancillary coverages in all lines of coverage –Excess Auto Liability and Excess Employers Liability Coverages being reduced / eliminated / being charged for. Certain classes of business (single pilot turbine aircraft, helicopters, owner pilots) are having the main liability limits reduced. ◼2020 had most aviation clients seeing renewals of 20-30% increases –even with no loss history and reductions in exposure. ◼2021 seems to be flattening to 15-25% increases. ◼Reinsurance Marketplace is indicating 2021 renewal increases of 30 -40%. ◼Claims of $100MM+ becoming the “norm”. 16.E.9.b Packet Pg. 2762 Attachment: 2021 Aviation Market Update (17748 : Approval to purchase Aircraft and Airport Insurance 3©2019 ARTHUR J. GALLAGHER & CO. | AJG.COM 18GGB29618X-Strat Rev Aviation Insurers: ▪AIG Aerospace ▪Allianz Global Risks U.S. Insurance Company ▪Chubb (formerly ACE USA) ▪Global Aerospace ▪Great American Insurance Co. –Will not insure Commercial Helicopters ▪Old Republic Aerospace ▪QBE Insurance Company –Finicky with Helicopter Exposures ▪Starr Aviation ▪USAIG ▪W. Brown & Associates / Endurance Insurance Co ▪AXA / XL Catlin Insurance Company 3 Aviation Insurance Market Update –2021 16.E.9.b Packet Pg. 2763 Attachment: 2021 Aviation Market Update (17748 : Approval to purchase Aircraft and Airport Insurance From: Scott Bolger <Scott_Bolger@ajg.com> Sent: Tuesday, August 10, 2021 10:51 AM To: WalkerJeff <Jeff.Walker@colliercountyfl.gov> Cc: GonzalezGreily <Greily.Gonzalez@colliercountyfl.gov>; Jennifer Cummins <Jennifer_Cummins@ajg.com> Subject: RE: Aviation Renewal and Marketing EXTERNAL EMAIL: This email is from an external source. Confirm this is a trusted sender and use extreme caution when opening attachments or clicking links. Jeff / Greily, Please find the attached renewal proposal for the Collier County Board of Commissioners Aircraft Hull & Liability and Airport Liability Insurance Coverages. As per your request, we did fully market this coverage to all available insurers (which are highlighted on page 7 of the proposal) and received a number of declinations (mostly because the helicopter is flown Single Pilot and is worth $8MM) but we also did receive a renewal quotation from your existing insurer Global Aerospace as well as an option from ACE USA. The quotation from your current insurer, Global Aerospace, Inc., is the most competitive in both the coverage terms and conditions as well as the premium. The renewal coverages from Global Aerospace are “as expiring” versus the quotation from ACE which would include a number of coverage reductions and deductible increases. The overall premium from Global Aerospace represents a 15.8% premium increase versus ACE’s 30.6% increase. Global Aerospace’s renewal premium increase is actually at the low end of the 10-30% renewal expectations we highlighted to Carleton back in May. Also, as a very specific benchmarking note. I have another client that operates EMS Helicopters similar to yours that also renews on October 1st. Their premium for one of their $8MM Helicopters is roughly $250,000 – yours is $107,000. This difference is solely due to your Governmental Entity Status versus my other clients commercial operation. I should also note, that when you see the various notes in your proposal about the coverages of ACE not being as good as your quote from Global Aerospace – I should note that the quotation from ACE is more in line with what we typically see provided to Commercial Helicopter EMS operators. The coverages provided by Global Aerospace to Collier County are far higher than what we typically see provided to other EMS Helicopter operations – the reason (in my opinion) is because of your long relationship with them and you have had no losses on the helicopter. I hope that this helps explain. We would be happy to review the proposal with you once you have had a chance to look at it. Do not hesitate to contact us with any questions or concerns you may have. Best Regards Scott Bolger, CPCU, ARM Area Executive Vice President Aviation Practice O: 847-586-0802 │C: 847-902-8108 │F: 847-586-0810 scott_bolger@ajg.com Gallagher 2580 Foxfield Road, Suite 203 St. Charles, IL 60174 CA License #0D69293 16.E.9.c Packet Pg. 2764 Attachment: Correspondence from Gallagher Scott Bolger (17748 : Approval to purchase Aircraft and Airport Insurance for FY 22)