8.4. SR 12-17-2012 - Laserfiche WebLink

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CO of REQUEST FOR ACTION River To Item Number Mayor and City Council 8.4 Agenda Section Meeting Date Prepared by General Business December 17,2012 Tim Simon, Finance Director Item Description Reviewed by Annual Renewal of City's Insurance Policies with the League of Cal Portner, City Administrator Minnesota Cities Insurance Trust Reviewed by Action Requested The City Council is asked to accept and approve the renewal of the city's insurance policies with the League of Minnesota Cities Insurance Trust (LMCIT). Background/Discussion For over 20 years, the City of Elk River and Elk River Municipal Utilities (ERMU) have participated in the LMCIT. Coverage has been in binder since the official July 1 renewal date even though the renewal documents and rates were just received. The workers' compensation insurance renewal is included as well;that policy renewed on October 1, 2012. The policies have remained unchanged for the most part. Here are a few highlights with this year's insurance renewal: • The city received two dividends last year for participating in the LMCIT program;$63,624 (19% increase over prior year) on the insurance package and$36,751 on the workers compensation. The city should expect to receive the 2012 dividend in December. These dividends have historically offset premium increases and allowed for deductible increases. • The property schedule has remained relatively the same as last renewal with property rates increasing about 3%. • The package coverage including property, autos,municipal liability, etc. came with an increase of about$40,850,largely due the land use claim which has an impact in the formula.The next renewal will be the last surcharge for the prior land use claim. • The workers compensation costs have increased as our experience modification factor has increased from .95 to 1.02 for this renewal. The league has indicated that a 1.02 is "right around- average." The league gave us a breakout of workers compensation formula based on the city and ERMU as stand-alone renewals. The city would be .98 and ERMU would be 1.14. The city and ERMU continue to be proactive in promoting safety and safety standards through the continued dedication of all city employees and the Safety Committee. In last year's renewal,we recommended the change to a$20,000 deductible option and keeping the same $40,000 aggregate.This worked very well for the 2011-2012 renewal as we only had a few minor claims against the deductible. Outside the land use claim there were no other significant claims. Financial Impact PQMEREB UY [NATURE