5.2. SR 08-16-2004 - Laserfiche WebLink

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FIRST NATIONAL INSRUANCE AGENCY SERVICE CENTER 812 MAIN STREET ELK RIVER, MN 55330 August 12, 2004 To: Honorable Mayor & council Persons City of Elk River Thank you for the time on your Agenda for the meeting of August 16, 2004. I will attend to present the insurance renewal information from the League of Minnesota Cities Insurance Trust for 2004. We will try to keep the presentation brief out of respect for your busy agenda, but I will be happy to address any questions you may have at the meeting, or at any later time. Although the City's renewal is again late for this year, there is improvement in the timing. The City's coverage has been under Binder since July 1, 2004, so there is no gap, however renewal covenants are awaiting your approval of the proposal. In general, the renewal proposal is again favorable, and the League's self-insured group program continues to be successful and stable. Members continue to have superior expertise available through the League program, and claims service is certainly among the strongest available in the marketplace. City Staff and, of course, Lori Johnson, continue to be professional and thorough as we work together on the City's insurance program each year. I appreciate the chance to work closely with them, and want to say again, that I am happy to both live in the City of Elk River, and work with you and your staff! A brief outline of the premium costs is attached for this year's renewal. I have included a few notes about points I felt were important, explanations about some of the premium changes, and several options for your consideration. I will also be available for any other questions you may have. Please allow me to point out several special points: 1) LMCIT Rates - the overall net result of LMCIT rate changes for this year should normally be about $ O. Property rates were increased by about 10%, reflecting loss experience, but municipal liability rates were decreased for the program. In our case, however, City of Elk River's experience rating credit was reduced for municipal liability, largely due to the impact ofthree land use claims. No loss has been paid, however, defense and investigation costs have totaled almost $80,000 over these three claims. Land use and employment related claims are considered at a factor of twice the costs and reserves, so in this case, the financial impact to the City's experience is double the costs to date.