M&C Review


COUNCIL ACTION:  Approved on 12/12/2017 

DATE: 12/12/2017 REFERENCE NO.: **G-19182 LOG NAME: 14WCIN2018
CODE: G TYPE: CONSENT PUBLIC HEARING: NO
SUBJECT:   Authorize Purchase of Excess Workers' Compensation Insurance Policy for Calendar Years 2018, 2019 and 2020 from Safety National Casualty Corporation Through Roach Howard Smith & Barton, Inc., in the Amount of $1,248,548.00 (ALL COUNCIL DISTRICTS)

RECOMMENDATION:

It is recommended that the City Council authorize the purchase of an Excess Workers' Compensation Insurance Policy from Safety National Casualty Corporation through Roach Howard Smith & Barton, Inc., in the amount of $1,248,548.00 for three policy years 2018, 2019 and 2020.

 
DISCUSSION:

The City's Excess Workers' Compensation Insurance Policy (Policy) expires on January 1, 2018.  The current Policy is underwritten by Safety National Casualty Corporation.  The Policy provides statutory coverage for workers' compensation, but with self-insured retention amounts of $1,750,000.00 per occurrence for general employees and $2,500,000.00 for police officers and fire fighters.  The two-year policy premium for this coverage for 2016 and 2017 was in the amount of $895,551.00.

Roach Howard Smith & Barton, Inc., (RHSB), the City's contract broker of record, (City Secretary Contract No. 49885), for excess workers' compensation insurance, recommends that the City purchase and bind coverage from Safety National Casualty Corporation (Safety National).  RHSB states that the purchase of this coverage from Safety National is the best and most advantageous coverage to the City.  Safety National holds an AM Best Rating of "A + XIII" (Superior) in the insurance industry.  Safety National's policy would provide the following coverage with two self-insured retention levels for a flat premium in the amount of $1,248,548.00 for three years coverage.

Coverage TypeLimits of LiabilitySelf-Insured Retention (SIR)
Workers' CompensationStatutory Limits$1,500,000.00 for General Employees
$2,250,000.00 for Police Officers and Firefighters

The quoted flat premium cost in the amount of $1,248,548.00 represents an annual 7.1 percent premium decrease from the previous policy.  The Self-Insured Retention amounts stay the same for general employees as well as for police officers and fire fighters from the previous policy.

In addition to excess workers' compensation insurance coverage, Safety National offers substantial ancillary services that include access to safety consultation and compliance information, training and education programs for safety, environmental and employment issues, workers' compensation analysis tools, online driver simulation and curriculum for law enforcement and firefighters and domestic crisis management benefits.  These services are available to clients of Safety National at no additional cost.  While other excess insurers offer similar services, many of these services are extra costs.  RHSB Insurance recommends Safety National's excess insurance coverage and ancillary services as the best value to the City.

M/WBE Office - A waiver of the goal for MBE/SBE subcontracting requirements was requested by the Human Resources Department and approved by the M/WBE Office, in accordance with the City's ordinance, because the purchase of goods or services is from sources where subcontracting or supplier opportunities are negligible.

Note of Funding - The Fiscal Year 2018 budget includes money to fund this contract through September 2019.  An appropriation for the remainder of Calendar Year 2019 will be included in the Fiscal Year 2019 budget.  In addition, an appropriation for Fiscal Years 2019 and 2020 will be included in the Fiscal Years 2019 and 2020 budget requests to fund this contract through December 2020.

This M&C does not request approval of a contract with a business entity.

 
FISCAL INFORMATION/CERTIFICATION:

The Director of Finance certifies that funds are available in the current operating budget, as appropriated, of the Risk Management Fund.

TO
    Fund Department
ID
Account Project
ID
Program Activity Budget
Year
Reference #
(Chartfield 2)
Amount

FROM
    Fund Department
ID
Account Project
ID
Program Activity Budget
Year
Reference #
(Chartfield 2)
Amount
    60111 0147310 5520106           $1,248,548.00

Submitted for City Manager's Office by:
Susan Alanis (8180)
Originating Department Head:
Brian Dickerson (7783)
Additional Information Contact:
Chris Lam (9638)

 
 
ATTACHMENTS