Agenda 09/12/2023 Item #16E 5 (Protect the County against financial loss from casualty related claims)09/12/2023
EXECUTIVE SUMMARY
OBJECTIVE: To protect the County against financial loss from casualty related claims and lawsuits and
to comply with contractual and statutory requirements through the implementation of a cost effective, best
value Casualty Insurance program.
CONSIDERATIONS: Pursuant to Florida Statutes Section 768.28, the Risk Management Division
administers the Property Casualty Fund (Fund 5016) to finance its Property, Casualty insurance program.
Claims are administered by Johns Eastern Company. Brown & Brown is the County’s contracted broker
of record.
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 w ith
contractual requirements such as grants and leases; or if a claims bill is enacted pursuant to chapter
768.28, Fla. Statutes. The current program expires on September 30, 2023.
For the FY 2024 renewal, a Coverage & Premium Comparison Sheet is attached which illustrates the
pricing for each carrier by line of coverage and the purpose/basis of each coverage. The significant
highlights of the renewal are as follows.
• Total premium for all coverage lines increased 12.68% or $133,772.43. This increase is due primarily
to an increase in ratable exposures as reported in the application to the Underwriters.
• The Property Insurance program renews on April 1, 2024 and is not included in this recommendation.
Additionally, Aviation, Flood and Workers’ Compensation Insurance are not included in this
recommendation and will be submitted separately.
All carriers hold a Best’s financial rating of “A, Superior” or higher.
FISCAL IMPACT: The estimated annual premium including Pollution insurance is $1,214,130.01;
however, the Pollution insurance policy will be paid under a rate guarantee for three years. No premium
will be due in the next two fiscal years. The premium for FY 24 is estimated to be $1,214,130.01 as
outlined in the Coverage & Premium Comparison Sheet. Sufficient funds have been budgeted within
Fund 5016, Property and Casualty Insurance for this purchase.
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 approves the following:
1) The purchase of insurance coverage as outlined in the Executive Summary and the Coverage and
Premium Comparison Sheet effective October 1, 2023.
2) The rejection of Uninsured Motorist Insurance, authorizing the County Manager or designee to
execute the necessary rejection forms.
3) Authorize the County Manager or designee to complete the applications or other documents
necessary to bind coverage and services effective October 1, 2023.
16.E.5
Packet Pg. 973
09/12/2023
Prepared by: Michael K. Quigley, RMPE, Director, Risk Management Division
ATTACHMENT(S)
1. Casualty Renewal & Market Summary (PDF)
2. Collier Co Renewal Summary And Premium Comparison (PDF)
16.E.5
Packet Pg. 974
09/12/2023
COLLIER COUNTY
Board of County Commissioners
Item Number: 16.E.5
Doc ID: 26462
Item Summary: Recommendation to approve the purchase of Liability, Automobile, Cyber and other
miscellaneous insurance coverage for FY 2024 in the estimated premium of $1,214,130.01.
Meeting Date: 09/12/2023
Prepared by:
Title: Manager, Risk Finance – Risk Management
Name: Greily Gonzalez
08/23/2023 12:50 PM
Submitted by:
Title: Risk Management Director – Risk Management
Name: Michael Quigley
08/23/2023 12:50 PM
Approved By:
Review:
Risk Management Michael Quigley Director Review Completed 08/23/2023 12:52 PM
Office of Management and Budget Debra Windsor Level 3 OMB Gatekeeper Review Completed 08/23/2023 2:42 PM
County Attorney's Office Jeffrey A. Klatzkow Level 3 County Attorney's Office Review Completed 08/23/2023 2:53 PM
Office of Management and Budget Blanca Aquino Luque Additional Reviewer Completed 08/24/2023 9:34 AM
County Manager's Office Amy Patterson Level 4 County Manager Review Completed 09/05/2023 12:58 PM
Board of County Commissioners Geoffrey Willig Meeting Pending 09/12/2023 9:00 AM
16.E.5
Packet Pg. 975
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COLLIER COUNTY BOARD OF COUNTY COMMISSIONERS, ET AL
Excess Property and Casualty Insurance Program
To be Effective 10/1/2023-24
Executive Summary
Risk Management Associates, Inc., a wholly owned subsidiary of Brown & Brown, was contracted
with the County for the first time effective 1/1/2022 for the purpose of delivering Property and
Casualty Brokerage Services.
Despite a challenging insurance marketplace, we are pleased to present a favorable renewal as
outlined herein. Exhibits illustrating market conditions are provided.
Process Overview
✓ Casualty insurance markets approached – see responses below.
✓ Favorable market relationships and risk confidence revealed favorable renewal terms
from all incumbent markets.
✓ Relatively flat rates with minimal increases due to exposure changes.
Loss Analysis
✓ Formal Loss Analysis has been sent under separate cover
✓ Claims control and overall loss experience for the County continues to be excellent, which
is important for stable insurance renewals.
Safety and Loss Control Resources
✓ Pam Hancock, Director of Loss Control Services for Brown & Brown companies has been
working with the County to overview the safety program and provide general resources
and support of safety-related issues. She has found a robust safety program, and offered
access to a poignant webinar series continuing thoughout the year.
16.E.5.a
Packet Pg. 976 Attachment: Casualty Renewal & Market Summary (26462 : Approval to Purchase Liability, Automobile, Cyber and Other Insurance Coverages
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Executive Summary
Insurance Renewal Program Financial Results
➢ Exposure Increase in Revenues: 5.61%
➢ Exposure Increase in Payroll: 18.46%
➢ Overall cost increase is 12.68%
*2022/2023 Premiums include any applicable fees and are per the approved board agenda summary.
2022/2023 2023/2024 Difference
LINE OF COVERAGE ANNUAL PREMIUM* ANNUAL PREMIUM $ %
Excess Casualty Package $616,334.00 $728,974.00 $112,640.00 18.28%
Cyber Liability: $176,000.00 $168,000.00 -$8,000.00 -4.55%
Excess Crime: $8,875.00* $9,118.29* $243.71 2.75%
Terrorism &
Sabotage/Active
Shooter:
$69,435.00 $75,056.00 $5,621.00 8.10%
Pollution Liability (3-Year
Term prepaid)
2020-2023
$148,134.00
2023-2026
$167,972.00 $21,305.00 14.53%
Maritime Employers
Liability $17,500.00 $19,250.00 $1,750.00 10%
AD&D First Responders
Statutory $19,080.00 $19,080.00 $0.00 0%
TOTAL Liability/AD&D
PREMIUM $1,055,358.00 $1,189,130.01 $133,772.43 12.68%
16.E.5.a
Packet Pg. 977 Attachment: Casualty Renewal & Market Summary (26462 : Approval to Purchase Liability, Automobile, Cyber and Other Insurance Coverages
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Insurance Marketing Summary
10/1/2023-2024
Excess Casualty Package
Princeton Excess & Surplus Lines Ins. Co.* 5% inflation Rate increase, with premium increase based on
exposures changes.
Safety National Informal Market Inquiry
Ambridge Informal Market Inquiry
Berkely Informal Market Inquiry
Allied Public Risk Minimum SIR - $1M
Hudson Minimum SIR - $1M
Cyber
Indian Harbor Ins. Co. (AXA XL)* Quoted with acceptable renewal terms and competitive
pricing given the current marketplace.
Starr Indemnity Pending Response
AIG Pending Response – Minimum retention $1,000,000
TBD – Higher Limits Higher Limits available upon request
Excess Crime
Allmerica Financial Benefits Ins. Co. /
Hanover* Quoted – Incumbent
Full marketing in 2022 – no markets could compete with Hanover
Terrorism & Sabotage / Active Shooter
Lloyds of London / Hiscox* Quoted - Incumbent
Lloyd’s of London / McGowan-CFC Quoted, but only Active Shooter for approximately same
premium and coverage, including location exclusions.
16.E.5.a
Packet Pg. 978 Attachment: Casualty Renewal & Market Summary (26462 : Approval to Purchase Liability, Automobile, Cyber and Other Insurance Coverages
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Insurance Marketing Summary
10/1/2023-2024
Maritime Employers Liability/Excess
Atlantic Specialty Insurance Company* Quoted – Incumbent
Note: Would not quote If Any on Payroll, used $116,000
AD&D First Responders Statutory
Hartford Life & Accident Insurance
Complany* 2-Year Term (22-24) – 2nd Annual Installment
Pollution Liability
Indian Harbor Insurance Company
(AXA/XL)*
Incumbent offered favorable renewal terms for a 3-year
prepaid policy. Very limited marketplace due to specialty
coverage terms
*Denotes Incumbent
16.E.5.a
Packet Pg. 979 Attachment: Casualty Renewal & Market Summary (26462 : Approval to Purchase Liability, Automobile, Cyber and Other Insurance Coverages
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Insurance Market Conditions
Casualty | Q3 2023
Liability Market
Underwriting appetite and pricing remain stable in the liability marketplace. For insurance
programs with satisfactory loss experience, there are no anticipated significant pressures on
coverage or rates. Programs with less favorable loss experience can expect rate correction, with
underwriters disciplined to produce profitable results. The one exception on coverage is an
exclusion for per- and poly-fluoroalkyl substances (referred to as PFAS or the "forever" chemical).
Many markets are now taking a broad approach and attaching this exclusion for most, if not all,
insureds.
Capacity for the umbrella/excess market remains readily available. This creates competition and
positive movement for insurance buyers who fall into the underwriting appetite's preferred
classes.
Commercial Auto
Underwriters are continuing their ongoing pursuit of profitability in the auto liability insurance
marketplace. While rate increases have moderated, many carriers are still seeking some level of
a rate increase. Underwriting loss ratios have not crossed the positive threshold, even though
rates have increased for 48 consecutive quarters. Ongoing supply chain issues increase costs
and repair time for physical damage coverage.
Underwriting Scrutiny
There is increased underwriting scrutiny surrounding internal controls related to Fiduciary Liability,
Commercial Crime and Employment Practice Liability (EPL). Carriers are asking direct questions
regarding an organization’s controls and may require supplemental applications.
16.E.5.a
Packet Pg. 980 Attachment: Casualty Renewal & Market Summary (26462 : Approval to Purchase Liability, Automobile, Cyber and Other Insurance Coverages
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Insurance Market Conditions
CYBER RISK | Q3 2023
Rate Trends
Rates in the cyber insurance market are
decreasing, currently averaging 5% - 10% on
primary policies. Carriers are facing
considerable pressure to grow their books of
business, creating competition for customers
with strong controls. To compete, carriers are
more willing to offer broader coverage, lower
retention and, in some cases, higher limits. With
increased competition, the market is stabilizing
and more predictable than in previous years.
Layered programs are also gaining competition,
with resulting reductions in excess pricing,
particularly for larger towers. The increase in
competition is driven by additional capacity from
new entrants and markets re-entering the market
after exiting due to poor underwriting results.
Much of this new capacity is focused on excess
layers, contributing to the softening of the excess
cyber market. However, price decreases will tail
out for large towers as premiums reach a
minimum price for capacity in the high layers.
Retentions are trending down, particularly for
large risks, who faced the most significant
increases in prior years.
Changing Capacity/Limit Management
The market continues to see an increase in capacity, further accelerating the softening of
pricing. This capacity increase gives buyers more options from a wider group of carriers.
However, many carriers remain conservative, with some exceptions for significant risks.
Several external factors are impacting carrier appetite and capacity in the cyber market. Specific
industries are facing difficulties due to outside political or economic factors. Newer
environmental, social and governance (ESG) concerns, such as coal or non-renewable energy,
affect utility companies and producers of vice products like tobacco and alcohol. These
pressures may extend to other industries in the future.
16.E.5.a
Packet Pg. 981 Attachment: Casualty Renewal & Market Summary (26462 : Approval to Purchase Liability, Automobile, Cyber and Other Insurance Coverages
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Insurance Market Conditions
CYBER RISK | Q3 2023 (Cont’d)
Claims
The frequency of cyber insurance claims is increasing. While ransomware claims have
decreased in the last year, a slight uptick in the previous quarter has caused concern among
carriers. Carriers are also concerned about privacy-related incidents, particularly resulting from
violations of the Biometric Information Privacy Act (BIPA) and pixel tracking. Carriers are closely
monitoring claims activity, underwriting the exposure more diligently and, in some cases,
narrowing their offerings.
Coverage Limitations
Carriers continue to raise concerns about catastrophic losses, with many carriers releasing new
language limiting coverage for war or other catastrophic events. These changes are driven, in
part, by reinsurance restrictions.
Another area of close monitoring is the impact of artificial intelligence. The industry is watching
the implications of AI and its potential effects on coverage and risk.
16.E.5.a
Packet Pg. 982 Attachment: Casualty Renewal & Market Summary (26462 : Approval to Purchase Liability, Automobile, Cyber and Other Insurance Coverages
Covered Party:
Effective Date:
Version Date:
LIMIT ANNUAL
PREMIUM LIMIT ANNUAL
PREMIUM 2022/2023 2023/2024
$2,615,016,300 $2,761,608,700
1,000,000$ 616,334.00$ 1,000,000$ 728,974.00$ 146,592,400$
$1,000,000 / $1,000,000 $1,000,000 / $1,000,000 5.61%
$1,000,000 / $1,000,000 $1,000,000 / $1,000,000
$5,000,000 / $10,000,000 $5,000,000 / $10,000,000
$1,000 / $50,000 $1,000 / $50,000 $41,324,308 $39,279,381
$2,000,000 / $2,000,000 2,000,000$ (2,044,927)$
5,000,000$ 5,000,000$ -4.95%
$1,000 / $25,000 $1,000 / $25,000
$5,000,000 / $10,000,000 $5,000,000 / $10,000,000
$5,000,000 / $5,000,000 $5,000,000 / $5,000,000 $174,121,043 $206,268,310
300,000$ 300,000$ 32,147,267$
200,000$ -$ 18.46%
1,000,000$ 1,000,000$
1,000,000$ 1,000,000$
1,000,000$ 1,000,000$
1,000,000$ 1,000,000$
1,000,000$ 1,000,000$
112,640.00$
616,334.00$ 728,974.00$ 18.28%
$2,615,016,300 $2,761,608,700
176,000.00$ 168,000.00$ 146,592,400$
5.61%
(8,000.00)$
176,000.00$ 168,000.00$ -4.55%
4,000,000$ 8,797.60$ 4,000,000$ 9,039.20$
1,000,000$ 1,000,000$
4,000,000$ 4,000,000$
4,000,000$ 4,000,000$
76.98$ 79.09$ 243.71$
8,874.58$ 9,118.29$ 2.75%
$1,078,828,629 $1,110,643,788
23,000,000$ 69,435.00$ 23,000,000$ 75,056.00$ 31,815,159$
$10,000,000 / $20,000,000 $10,000,000 / $20,000,000 2.95%
$3,000,000 / $3,000,000 $3,000,000 / $3,000,000
250,000$ 250,000$
250,000$ 250,000$
250,000$ 250,000$
250,000$ 250,000$
3,000,000$ 3,000,000$
5,621.00$
69,435.00$ 75,056.00$ 8.10%
342 393
8,000,000$ 146,667.00$ 8,000,000$ 167,972.00$ 51
1,000,000$ 1,000,000$ 14.91%
$2,000,000 / $8,000,000 $2,000,000 / $8,000,000
$500,000 / $500,000 $500,000 / $500,000
$2,000,000 / $8,000,000 $2,000,000 / $8,000,000
Provides legal liability,
remediation, and
defense costs for
premises Pollution, and
fuel storage tank liablity
persuant to Florida
Financial Responsibility
requirements.
Purpose
Primary coverage layer
providing coverage for
bodily injury, property
damage, professional acts,
employment practices,
limited inverse
condemnation/eminent
domain, employee
dishonesty/fidelity,
automobile liability, and
automobile physical
damage pursuant to FS
768.28, Federal Statutes.
Provides coverage for
liability from a data breach;
defense costs; ransomware
and mitigation/compliance
costs associated with a
breach response.
Excess crime layer
providing coverage for
employee dishonesty,
faithful performance by
public officials and
computer and funds
transfer fraud.
Terrorism is excluded from
most policies. This
program covers liability
arising out of acts of foreign
and domestic terrorism
otherwise excluded. Active
Shooter-First Party
Coverage for Direct
Physical Damage. Third
Party Coverage for Bodily
Injury and Property
Damage resulting from
Malicious Attack.
Emergency Remediation Expense 100,000$ 100,000$
Non-Owned Disposal Site 100,000$ 100,000$
Exposure
DifferenceLegal Expense Aggregate 100,000$ 100,000$
Pollution Condition at Your Location 100,000$ 100,000$
Indian Harbor Insurance Company / AXA XL 10/1/2020 - 10/1/2023 10/1/2023 - 10/1/2026
Policy Aggregate Limit of Liability 100,000$ 100,000$
Premium
DifferenceSub-Total Sub-Total
Pollution Liability:3-Year Term - Prepaid 3-Year Term - Prepaid # of Tanks
Medical Payments and Funeral Expenses Sublimit 100,000$ 100,000$
Public Relations Sublimit 100,000$ 100,000$
Miscellaneous Crisis Management Expense Sublimit 100,000$ 100,000$
Additional Security Measures Sublimit 100,000$ 100,000$
Counseling Sublimit 100,000$ 100,000$
Exposure
DifferenceTerrorism & Sabotage Liability 100,000$ 100,000$
Active Shooter & Malicious Attack Property & Lliability 100,000$ 100,000$
Underwriters at Lloyds, London / Hiscox
Aggregate Limit of Liability
Premium
DifferenceSub-Total Sub-Total
Terrorism & Sabotage / Active Shooter:TIV
FIGA Assessment FIGA Assessment
Computer Fraud 1,000,000$ 1,000,000$
Funds Transfer Fraud 1,000,000$ 1,000,000$
Employee Dishonesty - Per Loss 1,000,000$ 1,000,000$
Faithful Performance 1,000,000$ 1,000,000$
Excess Crime:
Allmerica Financial Benefits Ins. Co. / Hanover
Premium
DifferenceSub-Total Sub-Total
Exposure
Difference
Premium
DifferenceSub-Total
Cyber Liability:Coverage Details Exempt from Public Record per HB7057 Coverage Details Exempt from Public Record per HB7057 Revenues
Forgery or Alteration 100,000$ 100,000$
Loss Inside the Premises 100,000$ 100,000$ Per Underwriter, overall 5% rate
increase in addition to exposure
changes
Loss Outside the Premises 100,000$ 100,000$
Money Orders & Counterfeit Paper Currency 100,000$ 100,000$
N/A
Crime
Employee Dishonesty 100,000$ 100,000$
Payroll
Physical or Sexual Abuse 300,000$ 300,000$
Ethics Violations -$ -$ Exposure
Difference Inverse Condemnation/Eminent Domain 300,000$
300,000$
Medical Payments
Pubilc Officials / Employment Practices Liability 300,000$ 300,000$
Fleet
Medical Payments
Designated Unmanned Aircraft 300,000$ 300,000$ Exposure
DifferenceAutomobile Liability 300,000$
50,000$
Earthquake, Annual Aggregate 50,000$ 50,000$
General Liability 300,000$ 300,000$
Revenues
Princeton Excess & Surplus Lines Ins. Co.
Auto Physical Damage 50,000$ 50,000$ Exposure
Difference Flood, Annual Aggregate 50,000$
LINE OF COVERAGE DEDUCTIBLE/SIR DEDUCTIBLE/SIR
Excess Casualty Package:
Collier County BOCC, et al
10/1/2023
8/21/2023
Coverage & Premium Comparison
2022/2023 2023/2024 Changes in Exposures
This proposal is intended to give a brief overview. Higher limits may be available. Please refer to coverage forms for complete details regarding definition of terms, exclusions and limitations.
16.E.5.b
Packet Pg. 983 Attachment: Collier Co Renewal Summary And Premium Comparison (26462 : Approval to Purchase
Covered Party:
Effective Date:
Version Date:
LIMIT ANNUAL
PREMIUM LIMIT ANNUAL
PREMIUM 2022/2023 2023/2024 Purpose
Primary coverage layer
providing coverage for
bodily injury, property
damage, professional acts,
employment practices,
limited inverse
condemnation/eminent
domain, employee
dishonesty/fidelity,
automobile liability, and
automobile physical
damage pursuant to FS
768.28, Federal Statutes.
Revenues
LINE OF COVERAGE DEDUCTIBLE/SIR DEDUCTIBLE/SIR
Excess Casualty Package:
Collier County BOCC, et al
10/1/2023
8/21/2023
Coverage & Premium Comparison
2022/2023 2023/2024 Changes in Exposures
Included (1 Tank)Included (5 Tank)
$1,000,000 / $3,000,000 $1,000,000 / $3,000,000
Included 1,467.00$ Included 1,679.72$
21,305.00$
148,134.00$ 169,651.72$ 14.53%
$116,000 $116,000
1,000,000$ 17,500.00$ 1,000,000$ 19,250.00$ -$
0.00%
Not Included Optional 578.00$ 1,750.00$
17,500.00$ 19,250.00$ 10.00%
1,526 1,526
225,000$ 19,080.00$ 225,000$ 19,080.00$ 0
75,000$ 75,000$ 0.00%
75,000$ 75,000$
-$
19,080.00$ 19,080.00$ 0.00%
$ 3,300,300 $ -$ 3,300,300 $ -
Sub-Total $ 25,000 Sub-Total $ 25,000
1,055,357.58$ 1,189,130.01$
133,772.43$
12.68%
1,214,130.01$
% Difference
Total Premium Including Contigent Law
Provides legal liability,
remediation, and
defense costs for
premises Pollution, and
fuel storage tank liablity
persuant to Florida
Financial Responsibility
requirements.
Provides coverage for the
liability arising out of County
employees' operation of
non-owned watercraft;
injury to crew and divers
per Jones Act 33 U.S.C.
Sec. 901.
Death benefits provided to
law enforcement officers
and extended to paramedic
staff pursuant to FS 112.19.
Contigent Law Enforcement Professional
Florida Sheriff's Self- Insurance Fund
Contingent coverage for
any alleged liability of
County for Sherrif
operations.
Sub-Total
Unlawful & Intentional Death -$
Sub-Total
2 Alt Quotes Rcvd but higher prem
Premium
Difference
-$
TOTAL PREMIUM
$ Difference
Fresh Pursuit -$ -$
Exposure
DifferenceIn the Line of Duty -$ -$
Sub-Total
AD&D First Responders Statutory:2-Year Term - Annual Installments 2-Year Term - Annual Installments # of Employees (2020:2022)
Hartford Life & Accident Insurance Co.10/1/2022 - 10/1/2024 10/1/2022 - 10/1/2024
Exposure
Difference
Terrorism Premium
DifferenceSub-Total
Atlantic Specialty Insurance Company
Martime Employers Liability 10,000$ 10,000$
Premium
DifferenceSub-Total Sub-Total
Maritime Employers Liability:Payroll
TRIA Terrorism
Underground Storage Tanks 200,000$ 200,000$
Unscheduled Locations 100,000$ 100,000$
This proposal is intended to give a brief overview. Higher limits may be available. Please refer to coverage forms for complete details regarding definition of terms, exclusions and limitations.
16.E.5.b
Packet Pg. 984 Attachment: Collier Co Renewal Summary And Premium Comparison (26462 : Approval to Purchase