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Home My WebLink About1981-04-21; City Council; 6515-1; Insurance brokerage services- -.'-. '-'.'••••'. . CITY. OF. CARLSBAD ... . * -..-.. •• ; .' AGENDA;B-ILL -NO. 6^/5^ " ^ f ''-•' ' '. / .' ' Initial: - .'." / •'• ' . •'.- . ": . ••:"-•' '.'•' :: : Dept. Hd. : PATE: April 21, 1ML___ ^ X;'h:: ^, ; : - . ' c. Atty, .DEPARTMENT.: . City Manager • • -'.-;';'...'• ... : . '~--:.- c M r - f '• * • "• ' SUBJECT: Agreement for Insurance Brokerage Services • .'.'-" . Statement of the Matter '•'.''' : -••.-. :';' .'-'••-'• •-•''. .As part of the City's proposed Risk Management Program which was .approved'.';" by Council at;their meeting of February,24, 1981, Staff was authorized to • seek bids for the appointment of one insurance broker to handle the pur- chase of property, casualty and inland marine insurance for the City.: 'Proposals were received from twelve brokerage firms. .These firms included the City's.\current borkers, others who had requested consideration and , brokers specializing•'.in,municipal insurance. Proposals were graded based on cost,.past service to the City, experience and abilities of principals, municipal insurance experience, access to markets and quality of•presenta- tion./. The five receiving the highest grades were 'interviewed by a .panel, (consisting of the Assistant City Manager/Administration, the Assistant "City Manager/Operations, the. Purchasing Officer, and, the City's Risk ;• /•- .Management Consultant. / . / '"."-. '•-. ..Based upon this process.and a careful check of references, Cal-Surance. Associates was selected to be the best qualified-.to serve the City in r .... this capacity. Cal-Surance specializes; in the area of municipal insurance and already acts as broker for over 30 California cities. They are small enough.to provide the individual service the City needs and yet large enough to have substantial influence in the insurance .market place. Their /fee,-based on a maximum commission level of 7%, is extremely competitive. Fiscal Impact • ' -. . .--. ' • /.. Commissions .payable to the brokers presently serving the City average 12%, or an annual cost to the City of approximately $35,000. Based on the 'proposed ceiling of 7% and the anticipated re-design of the City's insur- ance program, we can anticipate an overall, reduction in commission of over $25:,000. : / ; ' . . , Exhibits : '•- . • ' : • 1. Resolution No.. 6> $ 6 I •"../' - ; '. ' ." 2. Agreement 'for Insurance Brokerage Service - Exhibit "A" Recommendation Approve Resolution authorizing Agreement with Cal-Surance for Insurance Brokerage Services and. authorizing the City Manager to sign Broker, of Record betters as\may be required to transfer current insurance policies to Cal-Surance. . . AGENDA BILL NO. 6515 - Supplement #1 April 21, 1981 Page 2 COUNCIL ACTION: 4-21-81 Council adopted Resolution No. 6501. 1 2 3 4 5 6 7 8 9 30 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 RESOLUTION NO 6501 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CARLSBAD, CALIFORNIA, APPROVING AN AGREEMENT BETWEEN THE CITY OF CARLSBAD AND CAL-SURANCE ASSOCIATES, INC FOR INSURANCE BROKERAGE SERVICE The City Council of the City of Carlsbad, California, does hereby resolve as follows, 1 That certain agreement between the City of Carlsbad and Cal-Surance Associates, Inc for insurance brokerage service, a copy of which is attached hereto marked Exhibit "A" and made a part hereof, is hereby approved 2 That the Mayor of the City of Carlsbad is hereby authorized and directed to execute said agreement for and on behalf of the City of Carlsbad PASSED, APPROVED AND ADOPTED at a regular meeting of the City Council of the City of Carlsbad, California, held on the 21st day of April 1981 by the following vote, to wit AYFS Council Members Packard, Casler, Anear, Lewis and Kulchin NOES None ABSENT None RONALD C PACKARD, Mayor ATTEST ALCTHA (SEAL) Exhibit "A"' Resolution No. 6501• • • AGREEMENT BETWEEN THE CITY OF CARLSBAD' AND CAL-SURANCE ASSOCIATES, INC. FOR PERSONAL SERVICES ' ' . .-'..-..; "•"•....'• .'-. (INSURANCE BROKER) ' ; " -THIS AGREEMENT, entered into this 23rd day of April 1981, by and between the CITY OF CARLSBAD, a.municipal corporation,, hereinafter referred to as "CITY",.and CAL-SURANCE ASSOCIATES, INC. ^hereinafter referred to as". .:"BROKER." , ' .". ' ' , ' .'' . ,\ .••"':• .;•.'•' , • ;* ' ,>,. -'.''•• -.'.- ' . W I T N E S S E T H; ,. : ; ....''; WHEREAS,-CITY has need of insurance brokerage services for the placement and purchase'of insurance for the CITY: and ' % ' ,. " .WHEREAS, CITY desires to engage the services of an insurance broker to .provide these services; and • WHEREAS, BROKER is a licensed insurance broker and has the experience . 'and specialized knowledge required to perform this function; and . . .WHEREAS, for and in consideration of the mutual obligations hereby ' :. assumed, and the performance of the acts hereinafter set forth; . ' • . NOW, THEREFORE, the parties hereto agree as follows: ' •. '.. '•'.!• PURPOSE: BROKER agrees to arrange for the placement and purchase of all property, casualty and inland marine insurance required by the CITY, and agrees further to provide to CITY during the term of this Agreement , all .services hereinafter set forth. : 2. INSURANCE'BROKERAGE SERVICES: BROKER agrees to perform to the satisfaction. of the CITY, the following services; • a) , Conduct all necessary research and investigation on insurance markets available for the placement of CITY insurance programs, b) As may be required, put CITY:insurance policies out to bid to competing insurance carriers based on information provided and researched, by CITY. ' . . , . ; . ••/;••; c) Negotiate and arrange for the purchase of-such insurance as may be authorized by CITY. d) Act as liaison between CITY and insurance carriers in handling any disputes relating to claims, service or coverage problems. ye) Work with the CITY in analyzing and reviewing CITY insurance programs, recommending on alternative methods of handling exposures and advising on coverage exclusions and other problem areas. • ' .' • 3. COMPENSATION: Insurance brokerage commissions or fees included in premiums . payable to BROKER shall not exceed the current commission rate .payable by each insurer for like business, and, subject to an annual minimum of $6,500, shall in no event exceed seven percent (7%) of total premiums payable unless authorized in advance by the CITY. BROKER shall, upon request, provide to the CITY a .full report and accounting of all commissions,received. 4- TERM; This Agreement shall take effect at 12:01 a.m. April 22 1981,. ,' and shall be automatically renewed on April 22, _ each year thereafter unless and until otherwise terminated as hereinafter provided. 5v LICENSES: BROKER agrees at all times during the term of this Agreement to ., maintain in force, all licenses as may be required by the California Department of Insurance or any other agency for the performance of services pursuant to this Agreement. , 6- HOLD HARMLESS: BROKER will indemnify the CITY against and/hold .it harmless :- "'_ from all-and any cost, expense, or -liability for damages on account of . ' injury or .death to persons or damage to property resulting from or arising out of or in any way connected with the performance by BROKER of this Agreement, including the defense of any action arising therefrom, v BROKER will indemnify, hold harmless and defend.the CITY for. all costs, expenses and losses incurred by CITY as a result of any claims, demands. or causes of: action arising out of the performance by BROKER of this Agreement which may be"brought against CITY by any person. 7. INSURANCE: .,.'..,' . . . . . ' : ' , 0 a) BROKER agrees at all times during the term'of this Agreement to - : maintain in force comprehensive General Liability insurance which insures BROKER in the amount of One Million Dollars ($1,000,000) ••.-'"' • • ' . * . . • •'•". • against any loss or damage as a result of wrongful or negligent ; acts or.acts by Service Agent. b) BROKER agrees to maintain in force at all times during the term- of this Agreement, Workers' Compensation-Insurance as required by - • • law.1 aw. . c) In addition to general liability insurance required herein, BROKER * '. ' - , • ' . • • agrees to maintain in force at all times during the term of this Agreement, Professional Liability Insurance in the amount of One Million Dollars ($1,000,00) which -shall provide 'coverage for any : damages or losses suffered by CITY'as a result of any error or omission or neglect by BROKER which arises out of the professional . services required by this Agreement.' • d) Insurance policies shall provide that the insurance coverage shall . not. be. cancelled or-reduced by th'e insurance carrier without CITY having been given thirty (30) days prior written:notice thereof by such / carrier. BROKER agrees that it will not cancel or reduce said insurance coverage. ' • : ' ' .- •-.,"' ; e) At all times during the term of this Agreement, BROKER shall maintain , on file with the City Clerk a certificate of the insurance carrier or carriers showing that the aforesaid policies are in effect in the amounts above provided,-and that the policies cannot be'cancelled or reduced. "•••'., except on thirty (30) d.ays notice to CITY. • . ; . • 8, RELEASE OF INFORMATION BY BROKER: Any reports, information.or other data, t . % . • ^ prepared or assembled by the BROKER under this Agreement shall not be made available to any individual, or organization by the BROKER without the prior written approval of the CITY. 9. ; CANCELLATION: This Agreement may be cancelled by either party at any 'time ; during the term of this Agreement upon ninety (90) days prior written ••;.'. .. notice. ;." '.'•" :; • . : 10. .CONTRACT ADMINISTRATOR: The Assistant City Manager/Administrati an is - , designated as the Contract. Administrator for CITY: provided, however, ,. 'the designation may be changed by the City Manager by letter to BROKER. '!•!• SUCCESSORS AND ASSIGNS/. This Agreement'covers .professional1 services of a. : , • specific and unique nature and BROKER shall not assign, sublet nor transfer, . ; its interest in this Assignment without the prior written consent of CITY. 12. CONFLICT OF INTEREST: BROKER agrees not to accept any employment during the term of this Agreement by any other person,'firm or corporation which employment is or may likely develop a conflict of interest between CITY'S interests and the interest of third parties. "Conflict" as used herein • .... shall be defined and interpreted in accordance with Section 1090 of the Government Code. • • .-•'.; . :'•' • . • 13. .INDEPENDENT CONTRACTOR: BROKER shall perform all services hereunder as an independent-contractor. Neither BROKER ndr any person associated , with him in.the performance of said services.shall be considered an employee of CITY. IN WITNESS WHEREOF, the parties hereto have executed this Agreement the day and year first above .written. . '. • '• -f /..-'• ; --. '. .. CITY OF CARLSBAD, a Municipal . ' Corporation of the State of . ; ' .••.•-. ' • •. . California : RONALD C. PACKARD, Mayor ATTEST:. ALETHA L. RAUTENKRANZ,' City Clerk CAL-SURANCE ASSOCIATES, INC. APPROVED AS TO FORM: VINCENT T. 'BlONDOi JR. City Attorney