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tREQUEST FOR ACTION <br /> River <br /> TO ITEM NUMBER <br /> Mayor and City Council 4.10 <br /> AGENDA SECTION MEETING DATE PREPARED BY <br /> Consent January 22,2013 Tim Simon, Finance Director <br /> ITEM DESCRIPTION REVIEWED By <br /> Insurance Agent of Record Request for Proposal Cal Portner, City Administrator <br /> REVIEWED BY <br /> ACTION REQUESTED <br /> Motion to approve the Request for Proposals for professional insurance agent of record services. <br /> BACKGROUND/DISCUSSION <br /> With the League of Minnesota Cities Insurance Trust(LMCIT), the City of Elk River must have an <br /> insurance agent of record.The agency of Liberty Insurance, formerly First National Insurance agency has <br /> provided insurance agent of record services for the City of Elk River and Elk River Municipal Utilities for <br /> several years. One of staffs goals has been to review existing professional service contracts. Staff has <br /> prepared and is ready to issue a Request for Proposals (RFP) for professional insurance agent of record <br /> services for the renewal year of July 1,2013, thru June 30,2018 (5 years). <br /> As the City Council is aware,under State Statute,the selection of an insurance firm is considered a <br /> professional service.Accordingly,criteria in addition to cost will be reviewed. <br /> Timeline: <br /> City/ERMU distributes Request for Proposal January 23, 2013 <br /> Proposal due date February 15,2013 <br /> Review of RFP's completed February 22,2013 <br /> Interviews March 6-8,2013 <br /> Final decision/contract negotiation March 11,2013 <br /> Contract consideration by City Council March 18,2013 <br /> The RFP has been reviewed by the city attorney and was approved by the Elk River Utilities Commission <br /> at their January 8 meeting. <br /> FINANCIAL IMPACT <br /> Staff prepared the RFP to include a compensation system based on an annual fee rather than a <br /> commission. The annual fee will be paid directly by the city to the insurance agent of record firm. <br /> Previously,the commission was included in the cost of the premium and paid by the LMCIT to the <br /> insurance agent of record firm. Staff believes switching from commission-based to fee-based services <br /> provides greater budget certainty and transparency. <br /> The commission rate has been 7.5% for property/casualty and 2% for workers compensation. <br /> t W E e E II B 1 <br /> LNAIUPE <br />