7.1. SR 10-20-2008 - Laserfiche WebLink

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we will make necessary premium changes and can also add the excess limits if desired. 6) The City changed to a $5,000 deductible in 2007. Given the City's loss history and the increase in premium costs again this year, we are recommending the Council consider increasing the City's package deductible to a $10,000 level for 2008. We have prepared a brief analysis of approximate premium savings and deductible costs over the past 5 years, to help display rationale for this option. As noted last year, the frequency of claims appears to have declined over the past 4-5 years. This reduction in frequency points to the effectiveness of good loss control, risk management and safety training. Of course, there is always a chance that the averages will not be the norm for 2008, but the indicators are good. The City's choice of the $10,000 deductible option for Workers Compensation has been effective, as frequency of claims has dropped and the experience modifier is excellent. The City has also been adding new procedures and safety training to help help prevent losses. The City has also set aside LMCIT dividends to help fund deductible expenses and loss control programs, so would have this reserve from which to fund any possible additional deductible expenses. This new deductible would be acceptable to ERMU and also to the YMCA. The potential premium savings of approximately $31,750 would also keep the LMCIT insurance costs at about the same level as last year. If the City selects the $10,000 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 the event of storm damage to a number of City facilities, the deductible would be applied only once to the total of paid damages to the "occurrence" -the storm. Another example would be an auto accident in which a City vehicle was responsible for damage to 2 or 3 other vehicles. There maybe 2 or 3 claimants, but the deductible would apply once. If the Council is not entirely comfortable with a flat $10,000 deductible, we have secured an alternative option for $10,000 occurrence deductible with a $50,000 aggregate, and a subsequent $1,000 `maintenance' deductible. This option would provide the chance to cap deductible costs at $50,000, or slightly more in the event the City exceeded the `average' number of paid claims. It would also provide immediate premium savings of approximately $28,750. 7) The League's "No-Fault Sewer Back-up" coverage was reviewed and declined several years ago. The League has since offered options to increase the limit of coverage from $10,000 to either $25,000 or $40,000, although the conditions of coverage have not changed. If the Council is interested in this