HomeMy WebLinkAbout2002-06-25; City Council; 16803; Renewal of Excess Workers' Compensation BenefitsCITY OF CARLSBAD - AGENDA BILL /3
~TG. 6-25-02 1 RENEWAL OF EXCESS WORKERS’ CITY ATTY~
IEPT. HR COMPENSATION BENEFITS CITY MGR~
~
3ECOMMENDED ACTION:
Approval ofResolution No. 2002-187 authorizing the renewal of Excess
Workers’ Compensation Insurance coverage in accordance with staffs recommendation
at a premium deposit of $74,180.
ITEM EXPLANATION:
The current excess Workers’ Compensation Insurance Policy expires on June 30,2002.
Coverage will be continued pending Council action on the current proposal. This policy
provides for loss coverage which exceeds the City’s self-insured retention level.
Cal-Surance, the City’s insurance broker, obtained renewal quotes from the City’s
incumbent carrier, Employers Reinsurance Corporation, as well as seven other carriers
(see Exhibit 2). The renewal quotes for annual premiums ranged from $74,180 to
$150,000. Based on these quotes, staff recommends renewing its policy with Employers
Reinsurance Corporation. The renewal premium is $74,180 which is significantly higher
than last year’s premium of $40,800.
The City’s Self Insurance Retention (SIR) would increase from $300,000 for each claim
to $500,000 for each claim. As shown in Exhibit 2, none of the potential carriers offer a
$300,000 SIR. However, in the last twenty-eight (28) years, the City had only three (3)
claims that exceeded the SIR threshold. Therefore, this increase to the SIR is not likely
to have a significant fiscal impact.
Increases to both the premium and the SIR are due to: 1) nation-wide losses experienced
by workers’ compensation insurance providers, 2) an increased concern by insurance
providers regarding large costs due to a higher concentration of employees in one
worksite and 3) mandatory increases to the Workers’ Compensation benefits.
FISCAL IMPACT:
The recommendation renewal quotation for one year is $74,180. The City’s Self
Insurance Retention (SIR) would increase from $300,000 for each claim to $500,000 for
each claim.
EXHIBITS:
1. Resolution No. 2002-187 .
2. Summary of Excess Workers’ Compensation Insurance Quotations
I
I
!
1(
1’
1:
1:
Id
If
If
1;
1E
1s
2c
21
2;
2:
24
25
2€
27
28
RESOLUTION NO. 2002-187
A RESOLUTION OF THE CITY COUNCIL OF THE
CITY OF CARLSBAD, CALIFORNIA, AUTHORIZING
RENEWAL OF THE CITY’S EXCESS WORKERS’
COMPENSATION INSURANCE.
WHEREAS, the City has established a self-insurance program for workers’
compensation; and
WHEREAS, the City’s Insurance Broker has received a renewal quotation for
Excess Workers’ Compensation Insurance coverage; and
WHEREAS, upon evaluation of this quotation for excess insurance, the City
desires to renew its insurance.
NOW, THEREFORE, BE IT RESOLVED by the City Council for the City of
Carlsbad, California, as follows:
1. That the above recitations are true and correct.
Ill
Ill
Ill
Ill
Ill
Ill
Ill
Ill
Ill ,
Ill
1
1
2
1
C
€
- I
E
E
la
11
12
13
14
1s
16
17
16
19
20
21
22
23
24
25
26
27
26
2. That the renewal of the City’s Excess Workers’ Compensation Insurance
coverage with Employers Reinsurance is hereby approved and the Finance Director is
authorized to issue a warrant for the deposit premium of said renewal in the amount of
$74,180.
PASSED, APPROVED, AND ADOPTED at a regular meeting of the Carlsbad
City Council held on the 25th day of JUNE ,2002; by the following
vote, to wit:
AYES: Council Members Lewis, Nygaard, Hall
NOES: None
ABSENT: Council Members Kulchirl . 5
ATTEST:
h%L
M. WOOD, City Clerk
?age 2 of 2 of Resolution No. 2002-187
.....
L"" "_