HomeMy WebLinkAbout2024-06-18; City Council; ; Purchase of Excess Liability Insurance CoverageCA Review JRT
Meeting Date: June 18, 2024
To: Mayor and City Council
From: Scott Chadwick, City Manager
Staff Contact: Ed Garbo, Risk Manager
ed.garbo@carlsbadca.gov or 442-339-2471
Subject: Purchase of Excess Liability Insurance Coverage
Districts: All
Recommended Action
Adopt a resolution approving the purchase of a maximum of $43 million of excess liability
insurance coverage through California Insurance Pool Authority for fiscal year 2024-2025 for an
amount not to exceed $1,258,000.
Executive Summary
The city is renewing its excess liability coverage of up to $43 million through California
Insurance Pool Authority for fiscal year 2024-25 in an amount not to exceed $1,258,000.
The city moved its excess liability insurance program to California Insurance Pool Authority in
fiscal year 2019-20 because it was able to obtain higher coverage limits and a more competitive
price than the previous insurance pool program.1
The policy period will run July 1, 2024, to June 30, 2025.
This purchase must be approved by the City Council under Carlsbad Municipal Code Section
3.28.040 (D)(1) because the cost exceeds $100,000 per agreement year.
Fiscal Analysis
The estimated premium for fiscal year 2024-25 for California Insurance Pool Authority excess
liability coverage is not to exceed $1,258,000, which represents a $185,315, or approximately
19.5%, increase over last year’s premium. While the market is showing continued signs of
stabilization, this increase is due to an overall hardening in the insurance marketplace, with
prices higher and policies harder to obtain. Sufficient funds have been included in the fiscal year
2024-25 Budget for this premium.
Next Steps
Staff will obtain a final premium calculation from California Insurance Pool Authority and create
a purchase order for payment.
1 The California Insurance Pool Authority is a joint powers authority composed of fourteen member cities.
June 18, 2024 Item #4 Page 1 of 3
Environmental Evaluation
This action does not require environmental review because it does not constitute a project
within the meaning of the California Environmental Quality Act under California Public
Resources Code Section 21065 in that it has no potential to cause either a direct physical
change or a reasonably foreseeable indirect physical change in the environment.
Exhibits
1. City Council resolution
June 18, 2024 Item #4 Page 2 of 3
RESOLUTION NO. 2024-134
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CARLSBAD,
CALIFORNIA, APPROVING THE PURCHASE OF A MAXIMUM OF $43 MILLION
OF EXCESS LIABILITY COVERAGE THROUGH CALIFORNIA INSURANCE POOL
AUTHORITY FOR FISCAL YEAR 2024-2025 FOR AN AMOUNT NOT TO EXCEED
$1,258,000
WHEREAS, the City Council of the City of Carlsbad, California has determined that it desires to
purchase excess liability insurance coverage through the California Insurance Pool Authority; and
WHEREAS, Aon has negotiated the purchase of a maximum of $43 million of excess liability
insurance coverage through the California Insurance Pool Authority for the next fiscal year beginning
on July 1, 2024, and concluding on June 30, 2025.
NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Carlsbad, California, as
follows that:
1.The above recitations are true and correct.
2.That the purchase of $43 million of excess liability coverage through the California
Insurance Pool Authority effective July 1, 2024, to June 30, 2025, is hereby approved
and the City Manager or designee is authorized to direct the Deputy City Manager of
Administrative Services to issue a warrant in an amount not to exceed $1,258,000 for
payment of the premium to the California Insurance Pool Authority.
PASSED, APPROVED AND ADOPTED at a Regular Meeting of the City Council of the City of
Carlsbad on the 18th day of June, 2024, by the following vote, to wit:
AYES:
NAYS:
ABSENT:
ABSTAIN:
BLACKBURN, BHAT-PATEL, ACOSTA, BURKHOLDER, LUNA.
NONE.
NONE.
NONE.
SHERRY F
(SEAL)
Exhibit 1
June 18, 2024 Item #4 Page 3 of 3