09-30-1985 CC MIN - Laserfiche WebLink

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PAGE 5 CITY COUNCIL MINUTES SEPTEMBER 39, 1985 Mr. Dan Greene indicated that the insurance market is in a down cycle and that there are several different factors involved. He pointed out that insurance companies are not receiving the same high interest rates on their investments as they had in the past so they are writing only the most profitable accounts. He proceeded to review the insurance proposal he had compiled for the City of Elk River and noted that the Home Insurance Company has been with the City for twelve years. He pointed out that no company would bid the work comp coverage by itself. He explained that Home indicated in the beginning that they wanted all or none of the insurance and that the League of Minnesota Cities Insurance Trust also said this. Subsequently, however, he pointed out both insurers did become somewhat flexible in this area. He explained the League of Minnesota Cities Insurance Trust does not write liquor liability or dam liability. He pointed out that the City took the liquor coverage away since the Home does not want it, however, in order to accept the liquor coverage, Home had to release the work comp coverage. He explained that the League of Minnesota Cities Insurance Trust won't write dam liability and that special markets would cost between $29,9ge and $25,gee which results in an overall higher premium than the Home Insurance Company offers. He explained that the League of Minnesota Cities Insurance Trust is also an assessible program, in other words, the League of Minnesota Cities can assess additional costs if they need to and that the City must pay the assessment by statute. He pointed out that some of the issues to consider for municipalities are whether to go to self insurance and whether to consider higher deductibles. With regard to umbrella coverage, he explained that the City cannot currently get umbrella coverage for either liquor or dam coverage. In summary, he pointed out that the proposed program, which is a combination of the League of Minnesota Cities Insurance Trust Program, and the Home Insurance Company Program results in an approximate doubling of the insurance rates for the City from 1985 and 1986. The Council continued its discussion of insurance coverages for the City and Mr. ~an Greene indicated he would continue to explore umbrella lnsurance markets and also research markets for municipal coverages outside Minnesota.