5.3. SR 10-17-2005 - Laserfiche WebLink

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FIRST NATIONAL INSURANCE AGENCY SERVICE CENTER 812 MAIN STREET ELK RIVER, MN 55330 October 7, 2005 To: Honorable Mayor & Council Persons City of Elk River Thank you for the time on your Agenda at the October 17, 2005 meeting. I will attend to present the insurance renewal information from the League of Minnesota Cities Insurance Trust for 2005. Although the actual anniversary date for the City's coverage with the LMCIT program is July 1 st, coverage has been bound pending completion of the renewal proposal. Potential changes in the property values for electrical generation equipment and the addition of operating coverage for Westbound Liquor are in process. Lori Johnson, your City and ERMU staff, and I have worked closely with our League underwriter to minimize cost increases again this year. We have also prepared some options for your consideration, and will be prepared to discuss them with the Council either at your October 17tli meeting, or in workshop, if you prefer. We feel this year's renewal proposal is very reasonably priced, and the City's coverages have all been carefully reviewed for accuracy and appropriateness. The Premium Comparison page included with this letter provides a 5-year history ofthe City's LMCIT pricing. The City's property values have more than doubled in the past 5 years, and although premium costs have increased, they have not doubled. This year's bottom-line cost increase over last year is 3.7%. I believe this is reasonable, and, in fact, expected to see more. Lori and I feel confident in making our recommendations to you, and agree the League has done an excellent job with the City of Elk River's renewal this year. I would also like to take this opportunity to tell you it's been a pleasure to work with your City's fine staff. They are professional, well organized and responsible people. This task of properly insuring a diverse and growing operation like the City of Elk River is not a simple one, but Lori and other City and Utilities employees are thorough and efficient. I appreciate working with them. We feel it is important to bring several additional points to your attention. The following notes are brief comments on each of these points. We also offer several options for your consideration again. Lori and I will be available for any other questions you may have about these matters. 1) 2005 LMCIT Rates - Rate changes have once again been modest under the League's self-insured program. Changes are related to claims costs. The changes in most lines are very minimal, or have minimal impact on the City's