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HomeMy WebLinkAbout97.Item 4 PPP 04-11-18 Administration Committee - Insurance Renewals t '+�r i s•. t EVERY ORGANIZATION HAS RISK EXAMPLES: WAYS TO HANDLE RISK (= FINANCIAL EXPOSURE): 1 . GETTING SUED 1 . TRANSFER RISK TO AN INSURANCE COMPANY 2. DAMAGE TO PROPERTY 2. TRANSFER RISK TO A CONTRACTOR 3. HARM TO EMPLOYEES 3. RETAIN RISK USING SELF-INSURANCE I \ V INSURANCE COSTS MONEY: 19% WE DON 'T BUY IT UNLESS WE NEED IT • WE NEED IT WHEN: 1 . MONETARY LOSS WOULD HURT - 2. EXPERT CLAIMS HANDLING WOULD HELP 3. JURY AWARDS ARE UNPREDICTABLE :s "THE IDEA IS TO USE YOUR INSURANCE ONLY TO PAY FOR SIGNIFICANT CLAIMS AND LOOK AFTER SMALLER ITEMS YOURSELF." — RBC INSURANCE SPECIAL FACTORS • 1 . ONLY CERTAIN INSURERS WILL INSURE _ GOVERNMENTAL AGENCIES di • 2. WE MAY WANT SPECIFIC LIMITS OR DEDUCTIBLE, BUT INSURER PRICING MAY --... DISCOURAGE IT r COMPARISONS • LIABILITY INSURANCE IF OCSD GETS SUED FOR BODILY INJURY, PROPERTY DAMAGE, OR MONETARY HARM A iiI Limits: OCSD = $40 million - City of Newport Beach = $50 million -- City of Fountain Valley = $50 million City of Aliso Viejo = $40 million City of Garden Grove = $35 million City of Orange = $30 million _" ..�. Deductible: OCSD = $500,000 per occurrence �- City of Garden Grove = $2 million City of Newport Beach = $500,000 City of Buena Park — 500 000 City of Orange = 350 000 COMPARISONS • WORKERS COMPENSATION INSURANCE IF EMPLOYEES GET INJURED ON THE JOB Limits: Required by law to provide "statutory" coverage Deductible: I OCSD = $ 1 million per occ. City of Garden Grove = $ 1 million per occ. X Cityof Santa Ana BICEP Pool = $ 1 million per occ. ( ) p . City of Huntington Beach (BICEP) _ $ 1 million per occ. • City of Newport Beach = $500,000 per occ. City of Anaheim (ACCEL Pool) _ $2 million per occ. COMPARISONS • PROPERTY INSURANCE DAMAGE TO OCSD STRUCTURES AND PERSONAL PROPERTY BY FIRE, EXPLOSION, FLOOD, ETC. BUT NOT BY EARTHQUAKE Limits: Higher property value ====> Higher limits •• OCSD = $ 1 billion limits - Deductible: OCSD = $250,000 per occurrence City of Anaheim = $ 100,000 City of Garden Grove = $25,000 City of Tustin = $ 10,000 :'A A SPECIAL CASE • EARTHQUAKE INSURANCE A TYPE OF PROPERTY INSURANCE IN CASE OF EARTHQUAKE Ef VERY EXPENSIVE, SO WE BUY ON 15 KEY STRUCTURES Limits: OCSD = $25 million ; Deductible: OCSD = 5% of loss, subject to $5 million minimum 90% of buyers 5% deductible (Source: Alliant) _ ,- Cost: _ $80,000 How Insurance Covers Our Operations Liability Property Earthquake Workers Boiler Cyber E&O Crime Public ,,watercraft Pollution Ins Ins Ins Comp Ins &Mach Liability Ins Officials Ins Ins Ins Liability Public—bodily X X X injury claim Public X x property damage claim Public— Y X X monetary harm Employees— >; bodily injury Damage to X x OCSD buildings Damage to Y X OCSD personal property Damage to X OCSD computers Damage to X OCSD machinery Loss of OCSD X money or intangible assets Note: This table is a simple chart,which doesn't show all the details of insurance. It does not take into account insurance exclusions, limits, deductibles,or other details which may affect coverage. Coverage may exist only for certain perils or under certain conditions. �i IIIW will Administration Committee April 11th 2018 = � ♦ ` i � 2018-19 Operational Insurance Renewals Alliant: The specialty insurance leader In - • • � - • - - - • - - - • - ft4lbant Excess Liability Program G L Rate 0.70 0.60 0.50 0.40 0.30 0.20 0.10 2002-03 2003-04 2004-05 2005-06 2006-07 2007-08 2008-09 2009-10 2010-11 2011-12 2012-13 2013-14 2014-15 2015-16 2016-17 2017-18 Premium 300,000 - 250,000 200,000 150,000 100,000 50,000 2002-03 2003-04 2004-05 2005-06 2006-07 2007-08 2008-09 2009-10 2010-11 2011-12 2012-13 2013-14 2014-15 2015-16 2016-17 2017-18 x . Property Program r - ' Property Rate 0.070 0.060 0.050 0.040 0.030 0.020 0.010 2002-03 2003-04 2004-05 2005-06 2006-07 2007-08 2008-09 2009-10 2010-11 2011-12 2012-13 2013-14 2014-15 2015-16 2016-17 2017-18 Premium 900,000 800,000 700,000 600,000 500,000 400,000 300,000 200,000 100,000 0 2002-03 2003-04 2004-05 2005-06 2006-07 2007-08 2008-09 2009-10 2010-11 2011-12 2012-13 2013-14 2014-15 2015-16 2016-17 2017-18 x . LIL Excess Workers Compensation ` r - ' dF Workers Compensation Rate 0.50 0.40 0.30 0.20 0.10 0.00 2002-03 2003-04 2004-05 2005-06 2006-07 2007-08 2008-09 2009-10 2010-11 2011-12 2012-13 2013-14 2014-15 2015-16 2016-17 2017-18 Premium 300,000 250,000 200,000 150,000 100,000 50,000 0 2002-03 2003-04 2004-05 2005-06 2006-07 2007-08 2008-09 2009-10 2010-11 2011-12 2012-13 2013-14 2014-15 2015-16 2016-17 2017-18 x . EarthquakeIL \ Earthquake Rate 0.1150 0.1100 0.1050 0.1000 0.0950 0.0900 0.0850 2016-17 2017-18 Premium $77,000 $76,500 $76,000 $75,500 $75,000 $74,500 $74,000 $73,500 2016-17 2017-18 • 9 �.10 Qu �s �. a r