5.3. SR 09-17-2007 - Laserfiche WebLink

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The limits of coverage and options have been discussed in workshop about two years ago. Should the Council wish to revisit these matters, I would be happy to present the details in a workshop setting again. And should the Council decide to purchase the additional limits this year; we will include the cost in the final proposal and motion. 7) The Vehicle schedule for this year includes 165 units. The average cost per unit has dropped this year, as both liability and physical damage rates have decreased by 3% for 2007. 8) The City changed to a $2,500 deductible in 2004. Last year, we recommended a change to $5,000. or higher, however, the Council decided to stay another year with the $2,500 deductible level. For the 2007-2008 coverage period, we are again recommending that the Council vote to accept a $5,000 Deductible. We have prepared a brief analysis of premium savings and deductible costs over the past 4 years. to help demonstrate why we feel this change would be a reasonable decision. Although a four-year analysis may be a somewhat short time frame to consider, there are other factors to consider. The frequency of claims appears to have declined considerably over the past 4-5 years. This is a good indicator that loss control programs and safety training are making a difference. For example, the number of "occurrences" resulting in payment over the past 4 years is about one-half the numbers just 5 and 6 years ago. The City has elected a $10,000 deductible for Workers Compensation coverage for a number of years now, and has done well with this decision. Frequency of injuries has dropped and the experience modifier is excellent. The City has also put new safety programs and additional training in place to help prevent losses. The City has set aside LMCIT dividends to help fund deductible expenses and loss control programs. so would have a "safety net" in place to fund future additional deductible expenses. One of the concerns the Council had last year was that a change to a larger deductible would also impact ERMU. We have discussed the possibility of a $5,000 Deductible with Bryan Adams. and he indicated he would be comfortable with the $5,000 figure. And last, is the potential premium savings - changing to a S5,000 Deductible for the 2007-2008 term would result in a reduction in the immediate premium costs of approximately $21,000, and if we use an average of the past 4 years history to calculate additional deductible expenses, the "net" savings would still be about $14.800. If the City selects the S5,000 deductible this year and finds it was not a good choice, the City can return to its previous deductible at the next renewal. It is also important to keep in mind that the LMCIT package deductible applies on an "occurrence" basis, rather than "per claim". This means that in