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Home My WebLink About4 District Liability Insurance Agenda Item # Memorandum To: Board of Directors From: Mary Chapman, Administrative Services Manager Date: April 15, 2005 SUBJECT: Consideration of renewing the District's property and liability insurance policies 1. WHY THIS ITEM IS BEFORE THE BOARD The District's property and liability insurance covers 5/1/04 to 4/30/05. It is time to approve the District's insurance renewal for the period covering 5/1/05 through 4/30/06. 2. HISTORY For the last few years we have been using Marsh Risk and Insurance Services to arrange for our insurance renewals. Robb Hubbard has left the firm and Keith Grand is now the client executive that oversees this process for the District. Keith's bio is on the last page of the attached proposal. 3. NEW INFORMATION Keith and his staff have put together a proposal for the renewal policies. The proposal includes a lot of information. Section 1 of the proposal provides a description of each policy being renewed. Page 15 is a listing of the proposed policies which compares the 2005-2006 premiums to the 2004-2005 premiums. Down toward the bottom of this schedule, you will see the total premium quote in the amount of $403,473.37 as compared to $412,370.13 for 2004-2005, This is a decrease of $8,896.76. Because each year we add additional property, additional employees and increased revenue, our premiums normally go up fairly substantially. I think that this decrease is a reflection of the work that Keith and his staff have done to keep the costs down. I have $468,407 included in the budget. Keith Grand will be attending the board meeting to make the annual presentation to the Board and answer your questions. There are additional options that Keith can explain when he makes his presentation. 4. RECOMMENDATION I recommend that the Board approve the renewal of the property and liability insurance policies for the 5/1/05 through 4/30/06 period as presented in the amount of $403,473.37 subject to modification due to additional approved options. Rural Electric Utilities MARSH FW I Under writindManagersT" W W d W W W W k • i ® W g k W k W d W W W A Truckee Donner Public Utility District Presented April 20, 2005 May 1, 2005 to May 1, 2006 Marsh Home Office, 1166 Avenue of the Americas, New York, NY 10036 Marsh San Francisco, I California Street,San Francisco, CA 94111 's 3 ` t s 3 PROPERTY (-INCREASED LIMIT " ADDED COVERAGE) POLICY LIMIT (TOTAL INSURED VALUE): $31,385,047Y COVERED PROPERTY- VALUES Real&Personal Property including Substations $18,020,332* Tanks, Wells, Water Equipment $11,222,000* Contractors Equipment Owned $1,008,158* Mobile Equipment—Owned $1,938 Computer Equipment—Hardware and Re-creation of Media $1,132,619 SUBLIMITS Motor Cargo Sublimit $25,000 Flood Sublimit $5,000,000** Extra Expense Sublimit $1,000,000 Perils Insured: All Risk of Direct Physical Loss or Damage and Extra Expense Coverage Excludes:Earthquake, Business Interruption, and other Time Element Coverages(except Extra Expense, which is included) Valuation: Replacement Cost except Contractors Equipment that is older than the f Oyears and substations older than 25 years, not rewound-actual cash value will apply. Deductible: property Damage and Extra Expense: $1,000 Per Occurrence. Flood. 2% of Total Insurable value at time of lass subject to S 25,000 minimum A. ADDITIONAL POLICY BENEFITS COVERAGE LIMIT PROVIDED Accounts Receivable Coverage.........................................................................-....$ 100,000 Contingent Line Movement Expense Reimbursement $50 per line, $500 maximum Contractors Equipment—Rented or Leased(short term/90 days or less)............. $ 50,000 Computer Equipment— Used in thefeld(owned, rented or leased)...................... $ 50,000 Debris Removal................................................25%of Liability for Physical Damage Loss Demolition and Increased Cost of Construction........_........................................... $ 100,000 Fire&Police Department Service Charge.............................................—............. $ 25,000 Hazardous Substances or Contaminants (to a covered loss at your location)........ $ 25,000 Property A way From Premises............................_........-........................................ $ 250,000 Newly Acquired Buildings&Personal Property.................................................. $ 1,000,000 Builders Risk/Course of Construction (completed project not to exceed)..,.......... $ 500,000 PropertyIn Transit...................... ............................................................_....--.... $ 250,000 Tools owned by Employees (Any one tool$500/$5,000 any one loss)..............-- $ 5,000 Valuable Papers Coverage..._.-.............................................................................. $ 100,000 Water Damage Due To Back—Up, Sewers And Drains................_.........................$ 25,000 FineArts Coverage....................................__................................................._....... $ 25,000 TerrorismCoverage...... .........................-....................................._......_............... $ Included �` r r H A ' 'F RD I 'll 1 COVERAGE BLANKET LIMIT Blanket Employee Dishonesty $500,000 Depositors Forgery or Alteration Protection $500,000 Theft, Disappearance&Destruction Money and Securities Protection Loss Inside Your Building $500,000 Loss Outside Your Building $500,000 Computer Fraud&Funds Protection $500,000 Deductible (optional deductible available—see p16) $2,500 • Coverage extends to Collection agents • Omnibus ERISA plans included • Money Orders and Counterfeit Currency included$50,000 limit and no deductible • Third Party Coverage • Merged/Acquired entities with revenues or assets of less than 15% of acquiring entity—no charge • Inventory Records can be used to support amount of covered loss COVERED PROPERTY LimIT Scheduled Locations and.Substations $ 21,168,177* Generation Facilities Excluded Perils Insured: Provides sudden and accidental breakdown coverage to scheduled properties. Comprehensive Coverage: Including transformers, switchgear and electrical distribution equip- ment, as well as emergency generators,pumps, motors, boilers and air conditioning equipment Sublimits: Expediting Expenses: $ 125,000* Extra Expense Only $ 125,000* Extended Period of Restoration 5** (#Days of Coverage) Data or Media $ 25,000** Spoilage $ 125,000* Newly Acquired Premises Included/I80 days (#of Days of Coverage) Ordinance &Law: S 1,250,000** Errors & Omissions Included** Ammonia Contamination: $ 125,000* Hazardous Substance: Water Damage: $ 125,000* S 125,000* Deductible: Combined, All Coverages $ 10,000 Except Transformers $ 1.50 per KVA, $10,000 Minimum Losses are calculated on Repair or Replacement Cost except on equipment 25* years of age or older Actual Cash Valuation will apply. If at the time of loss, a transformer has experienced a complete rewind, we will use repair or replacement in the loss settlement. Electrical equipment inspection services-Electrical equipment requires expert inspection to ensure smooth operation. CNA utilizes its experienced engineering and loss control services to help ensure your substations operate safely.Should a loss occur, we are committed to helping you get your system back up as soon as possible. increased limit ** added coverage � a 4WSuRAN( 1 R 11HOI COM N,IN}' COMPREHENSIVE GENERAL LIABILITY LIMIT OF LIABILITY Bodily Injury, Property Damage $ 1,000,000 per occurrence $ 6,000,000 annual aggregate. Personal Injury $ 1.000,000 per occurrence Advertising Injury $ 1,000,000 per occurrence Products and Completed Work $ 1,000,000 per occurrence $ 2,000,000 annual aggregate Fire Legal Liability $ 500,000 per occurrence Premises Medical Payments $ 10,000 per accident Fire Suppression $ 1,000,000 per occurrence Pesticide or Herbicide Application $ 1,000,000 per occurrence Failure to Supply(when loss results from accidental $ 1,000,000 per occurrence loss to tangible property owned/used by the Insured). Livestock Injury Coverage $ 5,000 per animal $ 25,000 max.per occurrence Employee Benefits Liability- $1,000 Ded. $ 1,000,000 per wrongful act COVERAGE INCLUDED: Fire Suppression in accordance with the Federal Land Policy and Management Act of 1976 > Blanket Contractual Failure to Supply when loss results from accidental damage to utility generating or distributing equipment owned or used by insured. % Employees as Named Insureds te Fellow Employee Coverage Blanket Additional Insured Blanket Waiver of Subrogation (when notified of contractual obligations) Railroad contractual Liability exclusion removed within 50 feet ofrailroad. REA Endorsement Host Liquor Law Liability Incidental Medical Malpractice Pesticide or Herbicide application . Non—Owned Watercraft Liability: watercraft less than 26 feet long. Coverage not subject to audit adjustment r Defense in addition to limit of liability Terrorism Coverage EXCLUSIONS Pollution Liability } Nuclear Energy Liability Care, Custody or Control ofProperty unless liability is assumed under a sidetrack agreement Uninsured—Underinsured Motorist Liability Mold, Bacteria, Asbestos, Silica e Directors &Officers Liability exclusion r AMG.RICAN Homi,ASSURANCE.COMPANY VEHICLES COVERED: Any owned, rented, leased or borrowed auto. It includes hired, non—owned, newly acquired, replacement and temporary substitute autos, but does not in- clude autos owned by your employees or members of their households, bor- rowed private passenger type autos, or autos where coverage has been reduced or limited on the auto schedule. COVERAGE LIMIT OF LIABILITY Bodily Injury and S I,000,000 CSL each accident Property Damage Liability Uninsured/Underinsured Motorist Coverage $ 1,000,000 CSL each accident Medical Payments $ 1,000 per person Physical Damage Coverage Deductible o Comprehensive $ 1,000 perelaim Collision $ 1,000 perelaim Specified perils—Trailers NO DEDUCTIBLE ADDITIONAL POLICY BENEFITS Fleet Automatic applicable Flat Premium—Policy not subject to audit adjustment A Employees as Insureds Fellow Employee Coverage 'r Blanket Additional Insured MCS 90 Motor Carrier Endorsement Rental Reimbursement- 30 do vs >• Expenses incurred to rent substitute equipment because of loss to a covered automobile Non-Owned and Hired Physical Damage Non—Owned and Hired Automobile Liability Full Glass Coverage-No Deductible Terrorism Coverage COVERAGE EQUIPMENT— LimIT OE LIABILITY RENTAL, DUE TO A COVERED Loss a Bucket Trucks, Digger Units or similar licensed equipment. $ 500 per day 30 day limitation $ 15,000 per accident h Other Vehicles $ 50 per day $ 1,500 peraccident LOSS VALUATION COVERED AUTOS TEN (10) YEARS OLD OR NEWER For covered autos that are ten(10) years old or newer at the time of the loss, if those covered autos have the following type of mounted equipment: e bucket trucks diggers o drills r air compressors Cranes generators power shovels or similar equipment. We'll pay the cost of repairing or replacing the damaged auto without deduction for depreciation. But we won't pay more than the smallest of the following: The amount it would cost to replace the damaged auto at the time of the loss with a new auto of similar kind and quality to be used for the same purpose. The actual cash value(ACV)of the damaged or stolen property at the time of the loss, if the damaged prop- erty is not repaired or replaced within 365 days of the loss. HYDRAULIC EQUIPM NT 15 YEARS OLD OR NEWER For hydraulic equipment that is fifteen (15)years old or newer, and is attached to a covered auto at the time of the loss, we'Il pay the cost of repairing or replacing the damaged auto without deduction for depreciation. But we won't pay more than the smallest of the following: S The amount you actually spend in repairing the damage. The amount it would cost to replace the damaged property at the time of the loss with new property of simi- lar kind and quality to be used for the same purpose. The actual cash value(ACV)of the damaged or stolen property at the time of the loss, if the damaged prop- erty is not repaired or replaced within 365 days of the loss. This insurance provides liability insurance protection for your business in excess of the below listed primary insurance. CARRIER: NATIONAL UNION FIRE INSURANCE COMPANY OF PITTSBURGH,PA LIMIT OF LIABILITY $ 11,000,000 Each Occurrence $ 11,000,000 AnnualAggregate $ 10,000 Selj=Insured Retention SCHEDULE OF UNDERLYING PRIMARY INSURANCE Commercial General Liability(Bodily Injury, Property $ 1,000,000 Per Occurrence Damage, Personallnjury) $ 6,000,000 AnnualAggregate Products, Completed Operations $ 1,000,000 Per Occurrence $ 2,000,000 AnnualAggregate Advertisinglnjury $ 1,000,000 Per Occurrence Employee Benefit $ 1,000,000 Fire Suppression $ 1,000,000 Automobile Liability Bodily Injury and Property Damage $ 1,000,000 Combined Employers Liability Bodily Injury By Accident $ 1,000,000 Each Accident Bodily Injury By Disease $ 1,000,000 Policy Limit Bodily Injury By Disease $ 1,00Q 000 Each Employee SPECIAL NOTE o Terrorism Coverage Included EXCLUSIONS Pollution Liability Nuclear Energy Liability- Cross Suits exclusion Care, Custody or Control of Property Owned Aircraft& Watercraft r Uninsured—Underinsured Motorist Liability Employment Practices Directors & Officers Liability Exclusion ' e P APIFRICAN INTERNA77ONALSPECIALTV LINES INSURANCE 1. POLLUTION LIABILITY—CLAIMS MADE Pollution Liability: This policy will pay on behalf of amounts any protected person is legally required to pay as damages for bodily injury,property damage or Clean-up Costs resulting from Pollution Conditions. Discovery Period: 14 days from incident Reporting period: 30 days from discovery of incident Covered Pollution Condition means: the discharge, dispersal, release or escape of any solid, liquid, gaseous or thermal irritant or contaminant, including, but not limited to smoke, vapors, soot,fumes, acids, alkalis, toxic chemicals, medical waste and waste materials into or upon land, or any structure on land, the atmosphere or any watercourse or body of water, excluding groundwater. $1,000,000 Each Incident/$1,000,000 Annual Aggregate $5,000 ded. Pollution cleanup costs means any reasonable and necessary expenses, including legal expenses incurred by you for pollution work a POLLUTION LIABILITY POLICYHOLDER DISCLOSURE STATEMENT UNDER TERRORISM RISK INSURANCE ACT OF 2002 You are hereby notified that under the federal Terrorism Risk Insurance Act of 2002 (the "Act") ef- fective November 26, 2002, you now have a right to purchase insurance coverage for losses arising out of an Act of Terrorism, which is defined in the Act as an act certified by the Secretary of the Treasury (i) to be an act of terrorism, (it) to be a violent act or an act that is dangerous to (A) human life; (B) property or(C) in- frastructure, (iii) to have resulted in damage within the United States, or outside of the United States in case of an air carrier or vessel or the premises of a U.S. mission and(iv) to have been committed by an individual or individuals acting on behalf of any foreign person or foreign interest, as part of an effort to coerce the ci- vilian population of the United States or to influence the policy or affect the conduct of the United States Government by coercion. You should read the Act for a complete description of its coverage. The Secre- tary's decision to certify or not to certify an event as an Act of Terrorism and thus covered by this law is fi- nal and not subject to review. There is a $100 billion dollar annual cap on all losses resulting from Acts of Terrorism above which no coverage will be provided under this policy and under the Act unless Congress makes some other determination. For your information, coverage provided by this policy for losses caused by an Act of Terrorism may be partially reimbursed by the United States under a formula established by the Act. Under this formula the United States pays 90% of terrorism losses covered by this law exceeding a statutorily established deductible that must be met by the insurer, and which deductible is based on a percentage of the insurer's direct earned premiums for the year preceding the Act of Terrorism. Unless you sign this form and return it to us rejecting Terrorism Coverage under the Federal Act, you will be covered for Terrorism as defined in the Act and your premium for that coverage is based upon which coverage option you choose(Coverage options setting forth limits, policy term, etc, are set forth in the attached letter of indication). The premium stated herein does not include any surplus lines taxes or fees that may be applicable, which are the responsibility of the insured. It is the broker's responsibility to follow ap- plicable state surplus lines laws and, in particular, to see that the appropriate premium tax (and stamping of- fice fee, if applicable) is collected from you and paid. Option I Terrorism Act Pre- $258 mium: Option 2 Terrorism Act Pre- $N/A mium: Option 3 Terrorism Act Pre- m $N,A mium: I hereby reject coverage in accordance with the Act. Company- AISLIC Return to: NAMED INSURED: Truckee Donner Public Utility Connell Corporate Center I District POLICY#/SUBMISSION#: One Connell Drive 3rd Floor Berkeley Heights, N7 07922 Signature of Insured Print Name/Title Date Insurance Summary Company: Landmark American Insurance Company—Non-Admitted Coverage: Property - Difference In Conditions —Earthquake (Flood included in property policy) Limit of Liability $5,000,000 per occurrence/annual aggregate $ 367,500 per occurrence sublimit for Extra Expense Deductible: $25,000 - All Other Perils Except 5% Of Values At Time And Place Of Loss, subject to $25,000 mini- mum Valuation: Replacement Cost except Actual Loss Sustained as respects Extra Expense Coverages. Building, Contents, Extra Expense, Fences Perils: Difference in Conditions Including Earthquake Remarks: Based on PD TIV of$31,383,109 Exclusions: Exclusion and limited additional coverage for Fungus. Exclusion and limited additional coverage for Electronic Data Terrorism Pathogenic or Poisonous Biological or Chemical Material TRIA Deletion of Terrorism Exclusion for$1,000 additional premium. Request to delete the exclusion must be made at time of binding. Extra Expense Option A $1,000,000 sublimit of liability for Extra Expense may be added for an additional premium of$1,630.96. Please note that Extra Expense must be acce ted or re'ected in writin at the time of bindin . e c � Account: TRUCKEE DONNER PUBLIC UTILITY DISTRICT Account Number: 498296 Producer: MARSH USA, INC(SAFE-SFO) SAN FRANCISCO.CA Public Entity Fiduciary Liability on Federal Insurance Company Form 14-02-3817(1/1990 ed.)and CRI000(611995 ed.) COVERAGE FORM(S) FORMING LIMIT OF DEDUCTIBLE NO. PART OF THIS POLICY INSURANCE AMOUNT 1. Fiduciary Coverage $1,500,000 $10,000 Defense Coverage Included S10,000 ENDORSEMENTS(The titles and headings are for convenience only. Please refer to the policy and endorsements for a description of coverage): 14-02-1249 WAIVER OF RECOURSE PREMIUM BILL(1/92 ed) 14-02-1350 CALIFORNIA PREMIUM ENDORSEMENT(1/95 ed.) 14-02-6846 ADDITIONAL TRUST(S)ENDORSEMENT(8/02 ed.) Truckee Donner Public Utility District Defined Benefit Pension Plan 14-02-6847 PENDING OR PRIOR LITIGATION EXCLUSION ENDORSEMENT(8/02 ED.) e Chubb & SOD,div.of Federal Insurance Company as manager of the member insurers of the Chubb Group of Insurance Companies OFFEREE DISCLOSURE NOTICE OF TERRORISM INSURANCE COVERAGE You are herebv notified that, under the Terrorism Risk Insurance Act of 2002 (the "Act") effective November 26, 2002, we are making available to you insurance for losses arising out of certain acts of international terrorism. The policy you are purchasing already includes insurance for such acts. Terrorism is defined as any act certified by the Secretary of the Treasury, in concurrence with the Secretary of State and the Attorney General of the United States, to be an act of terrorism; to be a violent act or an act that is dangerous to human life, property or infrastructure; to have resulted in damage within the United States, or outside the United States in the case of an air carrier or vessel or the premises of a United States Mission; and to have been committed by an individual or indi- viduals acting on behalf of any foreign person or foreign interest, as part of an effort to coerce the civilian population of the United States or to influence the policy or affect the conduct of the United States Government by coercion. You should know that the insurance provided by your policy for losses caused by acts of terrorism is partially reimbursed by the United States under the formula set forth in the Act. Under this for- mula,the United States pays 90% of covered terrorism losses that exceed the statutorily established deductible to be paid by the insurance company providing the coverage. The portion of the offered policy's annual premium that is attributable to insurance for acts of terrorism is: $ -0-. 0 INSURANCE SUMMARY Carrier: Landmark American Insurance Company Coverage The Insurer will pay on behalf of the Insured Persons or Insured Organza- CLAIMS MADE FORM tion all Loss which such Insured Person or Insured Organization shall be- come legally obligated to pay if during the Policy Period, any Claim or Claims are first made against the Insured Persons and reported in accordance with this policy,jointly or severally, for a Wrongful Act, Limits of Liability: $5,000,000 Aggregate limit of liability each policy period including Defense Expenses Retention: $ 0 each Director or Officer each loss but in no event exceeding $ 0 in the aggregate subject to $25,000 company reimbursement $25,000 each claim under Insuring Clause (C) $35,000 each claim for an Employment Practices Wrongful Act Defense Inside policy limits Endorsements: (includ- • 100% Bilateral Discovery ing, but not limited to) • California Changes - Nonrenewal • Disclosure Pursuant to Terrorism Risk Insurance Act of 2002 • Coverage Extension—Public Officials Exclusions: (including, • Nuclear Energy Liability but not limited to) • Prior and/or Pending Litigation prior to 5/1/2002 • Professional Errors and Omissions • Prior Acts and Known Circumstance Note: Terrorism Included, no charge a d COVERAGE 05-06 RENEWAL EXPIRI.NG PREMIUM Property S 63,020.00 S 68,756.00 Crime S1,396.00 S1,396.00 Boiler&Machinery S 15,203.00 S 20,458.00 General Liability $102,814.00 S97,345.00 Automobile S 39,249.00 S 41,400.00 Umbrella Liability $58,012.00 S 64,417.00 Flood $ 5,744.00 Included in DIC Premium below Pollution (including taxes &fees) $ 5,318.15 S 5,024.00 TRIA coverage (including taxes and fees) S 266.32 S 2-9.00 Difference In Conditions (DIC) -Earthquake $33,344.77 S34,064.#0 Earthquake Only Includes Flood Directors & Officers (including taxes&fees) S 41,806.13 $41,806.13 Fiduciary S 2,30&00 S 2,425.00 Marsh Brokerage Fee S 35,000.00 S 35,000.00 Program Premium S403,473.37 $412,370.13 This proposal is not intended to describe all coverages provided or available or all of their exclusions, conditions or limitations. It is designed to give you an outline of your insurance/risk management program, but it does not amend, al- ter, or extend the coverages afforded by the policies described hereln. *PREMIUM FINANCING AVAILABLE UPON REQUEST e I, CRIME —OPTIONAL CRIME DEDUCTIBLES—19ARIFORDCRIMESHIELD Crime Premium Would Be: Optional Deductible $1,000 $ 1,646 Optional Excess ERISA protection $500,000 $ 135 CLAIMS REPORTING AIG INSURANCE INSUREDS and BROKERS may have access to Internet reporting through www.aiges.com for all GENERAL LIABILITY, AUTO, WORK COMP, AND EXCESS LIABILITY CLAIMS. Your insured will be contacted immediately after coverage is bound to assist them in setting up a user name and password. For those agents who also want reporting authority, please contact Carolyn Kerrigan - AIG Claims @ (714) 436-5928 for user ID and passwords. To report a claim 24 hours a day—7 days a week by phone please call the following two centralized hubs that will be routed to applicable Handling Office in your territory: �OVERLAND PARK, KANSAS Alt C4SUALTl AUTO& EXCESS claims Centralized Claims Hub—WEST REGION P.O. Box 2588 Phone: 1-877-802-5246 Shawnee Mission, KS Fax: 866-854-4926 Handling Offices routed to: AIG HANDLING OFFICE PHONE NUMBER STATES AK, AZ, CA, CO, Kom Center 1-800-242-2923 HI, ID, MT, NV, 222 Southwest Columbia, Suite 700 NM, OR, UT, WA, Portland, OR 97201 fax: 503-323-2502 WY PROPERTY CLAIMS For all Rural Electric program claims please report property losses via fax to: Jim Jezewski Starr Tech 160 Water Street, 20"' Floor New York, NY 10038 Fax reporting to 1-212-458-6128 Jim jezewski&aig com Additional staff is also available in Jim's absence and all claims will be routed to additional Star Tech claims adjusters. Internet reporting is not available for property loss notices. AIG's response time is 24 hour notification after receipt of claim e Crime/ Fidelity Coverage PLEASE ADDRESS ALL INQUIRIES REGARDING CLAIMS FOR ALL SURETY AND FIDELITY CLAIMS TO THE FOLLOWING : Phone Number: (888) 266-3488 Fax—Claims: (860) 757-5835 or 860-547-8265 E-mail: claims(i lste suretv.eom Mailing Address: The Hartford BOND, T-4 640 Asylum Avenue Hartford, CT 06115 «- 1111001100001= f About Marsh Marsh, the world's leading risk and insurance services firm, has nearly 30,000 employees and annual revenues exceeding $5 billion. We provide global risk management, risk consulting, insurance broking, financial solutions, and insurance program management services for businesses,public entities, associa- tions,professional services organizations, and private clients in over 100 countries. Business Reforms Marsh is implementing a series of significant reforms to its business model that will ensure that the best interests of its clients are served and that every transaction is executed in accordance with the highest professional and ethical standards. The following reforms have been initiated: • Marsh has permanently eliminated the practice of receiving any form of contingent compensation from insurers. • All revenue streams will be 100 percent transparent to clients. Each client will receive a full ac- counting of all revenue earned by Marsh, including fees, retail commission,wholesale commis- sion and premium finance compensation,if any. • Marsh will insist that insurance companies show commission rates on all policies. • Marsh will seek consistent commission rates so that insureds are better able to compare costs of alternative proposals. • Marsh will provide transparency to its clients regarding its negotiations with insurers on their be- half. San Francisco Office San Francisco is home to the second largest office of Marsh in the United States—the third largest in the world, after New York and London—making us an influential voice in our firm. Located in the heart of the San Francisco Financial District, at 1 California Street,we have been in continuous operation for 89 years, since 1916. Staffed by approximately 700 employees, we provide a comprehensive array of insurance brokerage and risk management consulting services to Fortune 500 and 1000 companies, regional businesses and public entities. Public Entity Practice Within Marsh,the Public Entity practice has been operational as a specialized practice since 1988, now rep- resenting more than 1,500 public entities in the U.S. and Canada. In addition,the practice represents ap- proximately 90 intergovernmental pools and hundreds of public entities throughout the rest of the world. These clients are handled by a network of 250 public entity specialists throughout Marsh, all available to contribute their expertise to any Marsh colleague or client. The range of public entity clients encompasses, as of recent count, 98 utilities,289 cities, 176 counties,37 housing authorities, 10 Native American tribes, 90 pools, 50 ports, 28 states,328 school clients and 53 transit districts. Marsh's San Francisco office is home to the largest concentration of public entity specialists in the firm. MARSH An MMC Company KEITH GRAND PUBLIC ENTITY PRACTICE WESTERN REGION Keith Grand is a public entity insurance and risk management specialist in the San Francisco Marsh office and is a veteran of 38 years in the insurance and risk management business. Responsibilities include account management, contract and insurance review, marketing of insurance programs. Current activities include brokerage and risk management services for a range of clients, including a California pool of school districts, several water and electric utilities, a state-wide court system pool and various other California public entities, such as counties and special districts. Keith came to Marsh from another major brokerage firm. His background includes extensive public entity risk management experience as Risk Manager for Alameda County and, following that, City and County of San Francisco. Prior experience includes risk management for a multinational, pub- licly-traded corporation and commercial lines underwriting superintendent for a major national in- surer. His scope of risk management experience includes airports,ports, public transit, electric and water utilities, Owner Controlled Insurance Programs, fine arts museums, State legislative activi- ties, formation of pools, as well as the full gamut of operations of cities, counties and special dis- tricts, including internal budgeting, accounting and procedural practices. Keith earned a BA from the University of Maine, and holds the professional designations of Char- tered Property and Casualty Underwriter(CPCU) and Associate in Risk Management (ARM). Prior affiliations include memberships in RIMS, PARMA, PRIMA and numerous occasions as speaker and panelist at industry meetings. r e