HomeMy WebLinkAbout7 Property and liability insurance Agenda Item # 7
TRUCKEE DONNER
Public Utility Distr i
ACTION
To: Board of Directors
From: Mary Chapman
Date: April 02, 2008
Subject: Consideration of an Extension of the District's Property and
Liability Insurance Coverage and Change of the Annual Renewal
Date.
1. WHY THIS MATTER IS BEFORE THE BOARD
Staff would like to make some changes in the timing of the District's property and
liability insurance renewal. Only the Board can authorize these changes.
2. HISTORY
The District's property and liability insurance renewal is scheduled for May 1, 2008.
Staff is requesting that the Board authorize extending the current policies until June
1, 2008 and change future renewal dates to be June 1 st of each year.
On March 14, staff met with the District's insurance broker Keith Grand of Marsh Risk
& Insurance Services to discuss the upcoming property and liability insurance
renewal. We asked Keith to consider soliciting multiple insurance carriers for our
renewal to make sure that we were getting the best price. We also asked him to
obtain quotes on higher limits and higher deductibles. He indicated that he would
need more time and that he would check to see if we could extend our current policy
period one month.
Each year when the accounting staff has to collect all of the data for the renewal,
they are already extremely busy with year end work. Since we were talking to Keith
about extending the current coverage to June 1 st, we also discussed the possibility
of changing our renewal date every year to June 1 st. This would give our accounting
staff more time to provide the renewal data in a timely manner.
3. NEW INFORMATION
Keith has notified us that all of our current carriers are willing to extend our policies
one more month and that we can easily change the annual renewal date to June 1 st
of each year. If the Board approves the extension and request to change the
renewal date, the new schedule would be as follows:
May 16, 2008 Board receives property and liability renewal proposal in board
packet with various coverage options to consider
May 21, 2008 Board reviews property and liability renewal proposal with
Keith Grand of Marsh Risk Services — consider options
June 1, 2008 Approved renewal policies go into effect
June 1 st through May 31 st of each year thereafter will be the policy period
By providing Marsh Risk Services the additional time to market our insurance, we
hope to receive more competitive pricing.
4. FISCAL IMPACT
Extending the insurance one month will cost approximately $30,000 (1/12 of prior
year's premium plus a small administrative charge). Keith Grand is confirming the
exact charge with each of the current carriers. This charge only has an impact on
cash and will not be an additional annual expense to the District.
5. RECOMMENDATION
• Extend the current insurance policies one additional month to 6/1/08
• Authorize the annual renewal date to be changed to June 1 of each year.
• Authorize payment of the one month extension in an amount not to exceed
$33,000 ($30,000 plus 10%).
Mary Chap , m
aninistrative Services Michael D. Holley, General Manager
Manager