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HomeMy WebLinkAbout5 Insurance Package for 2002-2003 TDPUD STAFF REPORT TO: Board of Directors FROM: Mary Chapman, Administrative Services Manager SUBJECT Consideration of approving insurance package for 2002-2003 DATE: April 12, 2002 AGENDA # 5 Attached is the insurance renewal proposal from Aon Risk Services for the District's 2002- 2003 property and liability insurance. The total premium for the District's basic insurance package is $354,634. This is a substantial increase over last year for the same coverage. A portion of the increase relates to increased property values and the acquisitions of both Donner Lake and Glenshire water systems. A summary of the various policy costs is on the last page in the attached proposal. There are also a few options for other levels of coverage and deductibles that we can discuss at the meeting. Included in the 2002 budget is $275,399 for insurance. If we renew the insurance as proposed, the renewal amount will be $79,236 over the budgeted amount. Bob Brian from Aon Risk Services will be at the meeting to present the proposal and to answer any questions that you may have. RECOMMENDATION: That the Board renew the property and liability insurance as proposed by Aon Risk Services subject to revisions as agreed upon by the Board. TRUCKEE DONNER PUBLIC UTILITY DISTRICT INSURANCE PROGRAM MAY 11 2002 TO MAY 13 2003 RENEWAL QUOTATION Presented By: Bob Brian Aon Risk Services, Inc. of Northern California 199 Fremont Street, 15th Floor San Francisco, CA 94105 (415)486-7202 TABLE OF CONTENTS St. Paul Insurance Company: ContentsPage.................................................................................................3-4 Commercial Package Policy.................................................................................5 BlanketCrime..................................................................................................6 Boiler&Machinery...........................................................................................7 Commercial General Liability...............................................................................8 Automobile Liability......................................................................................9-10 UmbrellaPolicy...............................................................................................11 PremiumSummary...........................................................................................12 Optional Coverage and Deductibles: Comprehensive General Liability..........................................................................13 Automobile....................................................................................................I Electra,Magnetic Field Liability...........................................................................14 Limited Above Ground Pollution Liability...............................................................15 St. Paul Boiler&Machinery................................................................................16 Other Coverages: CNA Boiler&Machinery..................................................................................17 Travelers Energy Max.......................................................................................18 Earthquake & Flood (DIC).................................................................................19 FiduciaryLiability...........................................................................................20 Directors and Officers Liability(with Public Officials Extension)....................................21 Employment Practice Liability.............................................................................22 Rural Electric Utilities The St Mul Underwriting Managers" Truckee Donner - CA Renewal A Formal Proposal Presented By Bob Brian San Francisco April 10, 2002 SECURITY THAT ' S GROUNDED IN FINANCIAL STABILITY 09/01/00 Ed. a s a pp 1 s s � a V Rural Electric Utilities Underwriting Managers, St. Paul Fire and Marine Insurance Company and Hartford Steam Boiler Inspection and Insurance Company, and Virginia Surety have joined together to provide a comprehensive property and casualty insurance program specifically de- signed for the Rural Electric Cooperatives. We're committed to servicing the needs of the Rural Electric Cooperatives now and into the fu- ture. Our combined years of experience have given us the technical expertise to design a com- plete insurance program to include an effective loss control program and a knowledgeable claims department. Rural Electric Utilities Underwriting Managers and its affiliated agents have been associated with the Rural Electric Cooperatives for over twenty years. During this time we have pioneered many program improvements that have provided enhanced protection for the rural electric utili- ties from their unique risks. Each representative broker is knowledgeable in program design and coverage; service-oriented, and dedicated to meeting the specific needs of cooperatives across the country. Our claims adjusters take a reasonable, common—sense approach to the resolution of claims and we base our claim decisions on timely and factual information. Our approach to claims handling encompasses the best use of our people, our technology and our experience. We guarantee that all claims will be handled fairly. The Loss Control and Risk Management staff are loss control specialists that help you control and prevent loss exposures. These designated and certified safety professionals have the training and experience to work specifically with rural electric utilities. POISED FOR THE FUTURE CHARTER PLATINUM MEMBERS OF THE NRECA As your industry changes through deregulation, As part of our long—term commitment to serving you can rely on us to help you through the tran- the Rural Utilities, the St. Paul and Rural Elec- sition. Rural Electric Utilities Underwriting tric Utilities Underwriting Managers are proud Managers and St. Paul Fire and Marine Insur- to be Charter Platinum Associate Members of ance Company are experienced in handling the the NRECA. In addition, we receive first—hand insurance coverage's for diverse industries that information on important business trends — have undergone significant transformations. We particularly as they relate to changes in will stand by our Rural Utility customers and insurance exposures, coverage's,and costs. provide you with the assistance that you need to meet any challenges the future holds. The quality provided by The Rural Electric Utility Program is made possible by the teamwork of three outstanding companies. PROPERTY COVERED PROPERTY LIMITS OF LIABILITY Real&Personal Property, Substations $15,817,690 Tanks, Wells $5,600,000 Water Facility Equipment $2,450,000 Communication Equipment $80,700 Contractors Equipment(insured to value) $328,805 Motor Cargo $25,000 .Miscellaneous Tool Floater $49,540 Snowmobile $1,938 Computer Equipment-Hardware, Media &Extra Expense $500,000 Extra Expense $500,000 Perils Insured: Against Risks of Direct Physical Loss or Damage(Excluding Flood and Earthquake)subject to the Policy Terms, Conditions and Exclusions Coinsurance: Waived—(100%Insurance Values applicable) Valuation: Replacement Cost except Contractors Equipment that is older than five (5)years, actual cash value will apply. Deductible: $5,000 per occurrence. A. ADDITIONAL POLICY BENEFITS COVERAGE LIMIT PROVIDED Newly Acquired Buildings.................................................................................... $ 1,000,000 Newly Acquired Personal Property.........................................................................$ 500,000 PropertyIn Transit.................................................................................................. $ 500,000 Builders Risk/Course of Construction................................................................... $ 500,000 (must be reported within 6 months of construction) Property Away From Premises........................._.................................................... $ 250,000 BlanketEarnings .................................................................................................... $ 100,000 Accounts Receivable Coverage............................................................................... $ 100,000 Valuable Papers Coverage..................................................................................._. $ 100,000 Building Codes Coverage................................................................... .................... $ 100,000 Computer Coverage;Hardware And Media (If Not Scheduled Above).................. $ 50,000 (Includes any office files/documents converted to CD ROM) Contractors Equipment—Rented or Leased(short term/3 months or less).......... $ 50,000 Computer Equipment— Used in the field(owned, rented or leased)...................... $ 50,000 Pollution Clean Up And Removal(due to a covered loss at your location)............ $ 25,000 Water Damage Due To Back—Up, Sewers And Drains.................._...................__ $ 25,000 Fire Department Service Charge............................................................................ $ 25,000 FineArts Coverage................... ............................................. ......................_....... $ 25,000 Tools owned by Employees (Any one tool$500/$5,000 any one loss).................. $ 5.000 � � l COVERAGE BLANKET LISm Blanket Employee Dishonesty * $.500,000 Forgery or Alteration Protection $500,000 Money and Securities Protection Loss Inside Your Building $500,000 Loss Outside Your Building $500,000 Computer Fraud Protection $500,000 Depositor's Forgery Protection $500,000 * Coverage extends to collection agents. s s sHMMEE ELECTRICAL APPARATUS ASSUMPTION CLAUSE MECHANICAL BREAKDOWN COVERED PROPERTY L iMIT Scheduled Locations and Substations Co- $ 7,500,000 Generation Facilities Excluded Perils Insured. Refer to St. Paul Fire and Marine Boiler&Machinery Quotation Attached Comprehensive Coverage: Refer to St. Paul Fire and Marine Boiler& Machinery Quotation Attached Sublimits: Expediting Expenses: $ 100,000 per accident Extra Expense: S 50,000 per accident Pollution Clean up &Ammonia Contamination: S 100,000 per accident Spoilage: S 100,000 per accident Water Damage: COVERED UNDER PROPERTY SECTION Newly Acquired Locations: $100,000 Business Income: NOT COVERED Deductible: Refer to St. Paul Fire and Marine Boiler&Machinery Quotation Attached Valuation: Refer to St. Paul Fire and Marine Boiler&Machinery Quotation Attached Other Conditions: Refer to St. Paul Fire and Marine Boiler&11lachinery Ouotation Attached Engineering Services The following engineering services are available: Transformer Oil Gas Analysis (TOGA)for both oil Infrared Thermograph Surveys of main transformers screen testing and dissolved gas analysis tests of se- and electrical distribution equipment at selected substa- lected oil cooled transformers 2,500 KVA and larger. tions. Facilities selected will be determined in coopera- The appropriate substations will be selected with the tion with the insured. Information describing these tests cooperation of the insured. Information describing and their benefits may be supplied upon request. these tests and their benefits will be supplied upon Available on a per account basis request. All engineering services are performed by Hartford Steam Boiler Inspection and Insurance Company without additional cost. Please contact your REUprogram representative for more information regarding these services or to request an inspection. Electrical equipment inspection services Electrical equipment requires expert inspection to ensure smooth operation. The services and underwrit- ing for this aspect of the REUP are provided by Hartford Steam Boiler— the world's premier inspector and insurer of industrial machinery and electrical equipment. As part of the Aon Risk Services/St. Paul team, HSB 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. Through HSB's National Supplier Referral Service, we can recommend reliable, qualified firms that can supply and install any electrical equipment you may need. MMEM im 0 COMPREHENSIVE GENERAL LIABILITY LIMIT OF LIABILITY Bodily Injury, Property Damage $ 2,000,000 per occurrence Personal Injury $ 2,000,000 per occurrence Advertising Injury $ 2,000,000 per occurrence Products and Completed Work $ 2,000,000 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 $ 2,000,000 per occurrence Failure to Supply (when loss results from accidental $ 2,000,000 per occurrence loss to tangible property owned/used by the Insured). Weatherization Errors& Omissions Liability $ 2,000,000 per wrongful act $ 2,000,000 annual aggregate Livestock lnjuryCoverage $ 5,000 per animal $ 20,000 max.per occurrence Employee Benefits Liability-$1,000 Ded. $ 2,000,000 per wrongful act $ 2,000,000 annual aggregate COVERAGE INCLUDED: Fire Suppression in accordance with the Federal Land Policy and Management Act of 1976 Blanket Contractual S Failure to Supply when loss results from accidental damage to utility generating or distrib- uting equipment owned or used by insured. Employees as Named Insureds Fellow Employee Coverage Host Liquor Law Liability i Incidental Medical Malpractice Pesticide or Herbicide application Watercraft Liability, respect to watercraft less than 50 feet long and is not being used to carry people or property for a charge. Non—Owned Watercraft Liability: watercraft less than 75 feet long. Coverage not subject to audit adjustment Defense in addition to limit of liability o Contingent Line Movement Expense Reimbursement Non-owned Aircraft Liability(chartered with a crew&pilot, not used to carry persons or property for a charge) EXCLUSIONS S Pollution Liability e Nuclear Energy Liability Care, Custody or Control of Property unless liability is assumed tinder a sidetrack agreement Uninsured—Underinsured Motorist Liability o Directors & Officers Liability exclusion Please note that there is no Aggregate for the bodily injury property damage limit. a VEHICLES COVERED: Any owned, rented, teased or borrowed auto. It includes hired, non— owned, newly acquired, replacement and temporary substitute autos, but does not include autos owned by your employees or members of their households, borrowed private passenger type autos, or autos where cov- erage has been reduced or limited on the auto schedule. COVERAGE LIMIT OF LIABILITY Bodily Injury and $ 2,000,000 CSL each accident Property Damage Liability Uninsured/Underinsured Motorist Coverage $ 1,000,000 CSL each accident Medical Payments—Private Passenger Only $ 1,000 per person Physical Damage Coverage Comprehensive $ 100 tied.per claim r Collision $ 500 ded.per claim Specified Perils— Trailers No Deductible Applicable ADDITIONAL POLICY BENEFITS Fleet Automatic applicable Flat Premium—Policy not subject to audit adjustment Employees as Insureds ? Fellow Employee Coverage MCS 90 Motor Carrier Endorsement Rental Reimbursement- 30 days Expenses incurred to rent substitute equipment because of a loss to a covered automobile Hired Physical Damage Non—Owned&Hired Automobile Liability A Full Glass Coverage ' • • • • OEM COVERAGE EQUIPMENT- LIMIT OF LIABILITY RENTAL DUE TO A COVERED LOSS a Bucket Trucks, Digger Units or similar licensed $ 500 per day equipment. 30 day limitation $ 15,000 per accident b Other Vehicles $ 50 per day $ 1,500 per accident LOSS VALUATION COVERER 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: > bucket trucks power shovels cranes diggers drills generators air compressors 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 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 property is not repaired or replaced within 365 days of the loss. HYDRAULIC EQUIPMENT 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'll pay the cost of repairing or replacing the damaged auto without deduction for de- preciation. But we won't pay more than the smallest of the following: 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 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 property is not repaired or replaced within 365 days of the loss. ' Except for the state of Louisiana and New York, which are five(5)years for covered autos and ten(10) years for hydraulic equipment. x l 333M ' o This insurance provides liability insurance protection for your business in excess of the below listed pri- mary insurance. LIMIT OF LIABILITY $ 10,000,000 Each Occurrence $ 10,000,000 Annual Aggregate $ 10,000 Self—Insured Retention SCHEDULE OF UNDERLYING PRIMARY INSURANCE Commercial General Liability (Bodily Injury, Property $ 2,000,000 Per Occurrence Damage, Personal Injury) Products, Completed Operations $ 2,000,000 Per Occurrence $ 2,000,000 Annual Aggregate Advertising injury $ 2,000,000 Per Occurrence Employee Benefit $ 2,000,000 Fire Suppression $ 1,000,000 Weatherization $ 2,000,000 Automobile Liability Bodily Injury and Property Damage $ 2,000,000 Combined Employers Liability Bodily Injury By Accident $ 500,000 Each Accident Bodily Injury By Disease $ 500,000 Policy Limit Bodily Injury By Disease $ 500,000 Each Employee EXCLUSIONS Pollution Liability Electra Magnetic Field Liability Nuclear Energy Liability Care, Custody or Control ofProperty unless liability is assumed under a Sidetrack- Agreement o Uninsured—Underinsured Motorist Liability S Directors & Officers Liability Exclusion s COVERAGE PREMIUM Property $54,025 Crime $1,500 Boiler&Machinery $15,750 General Liability $123,247 Automobile $40,216 Umbrella Liability $48,278 Program Premium $283,016 This proposal is not intended to describe all coverages provided or available or all of their exclusions, condi- tions or limitations It is designed to give you an outline of your insurance/risk management program, but it does not amend, alter, or extend the co verages af- forded by the policies described herein. 1. COMPREHENSIVE GENERAL LIABILITY a Voluntary Property Damage Endorsement Increase General Liability Premium By: $ 500 Per Resident Consumer $ 5,000 Per Occurrence $ 5,903 b Property Damage Deductible per Occurrence: Reduce General Liability Premium By: $ 1,000 or $ 8,592 $ 2,500 or $ 16,571 $ 5,000 or $ 22,094 $ 10,000 or $ 25,777 $20,000 or $ Xot Available $25,000 $ 30,687 2. AUTOMOBILE a Optional Physical Damage Deductibles Reduce Automobile Premium By: $250 Comprehensive $500 Collision $ 339 $500 Comprehensive $500 Collision $ 508 The policy will pay amounts any protected person is legally required to pay as damages for covered bodily injury or property damage that: results from any electromagnetic field; r happens on or after the retroactive date and before the ending date of this agreement; and o is caused by an event. Electromagnetic field devaluation of real estate: The policy will pay amounts any pro- tected person is legally required to pay as damages for covered devaluation of real estate that: results from any electromagnetic field, and happens on or after the retroactive date and before the ending date of this agreement A $10,000 deductible will apply to each real estate sale. Limit of Liability Annual Premium $500,000 per Claim/$500,000 Annual Aggregate or $2,361 $1,000,000per Claim/$1,000,000 Annual Aggregate $5,903 • o a 2. LIMITED ABOVE GROUND POLLUTION LIABILITY— CLAIMS MADE Pollution Liability: This policy will pay amounts any protected person is legally required to pay as dam- ages for covered bodily injury or property damage that results from covered pollution incidents. Covered pollution incident means the emission, discharge, release or escape of pollutants from your premises or worksites. But only ifsuch emission, discharge, release or escape: i begins on or after the retroactive date; results from an accident; o happens entirely above ground; begins and ends within 72 hours; and results in environmental damage. $1,000,000 Each Event/$1,000,000 Annual.Aggregate Pollution Cleanup Costs Endorsement Pollution Cleanup Costs: The policy will pay covered pollution cleanup costs that result from the dis- charge, dispersal, escape, or release ofpollutants at or from your premises which.- begins while this agreement is in effect; is caused by a named peril; 3 happens entirely above ground, must be reported within 30 days of discovery Pollution cleanup costs means any reasonable and necessary cost or expense incurred by you for pollu- tion work. Pollution work means: the testing for, monitoring cleaning zap, removing, containing, treating detoxifying, or neutralizing of any pollutant; or the responding to, or assessing, in anyway the effects of any pollutant. Named peril means: collision with an aircraft, auto, rolling stock, or other vehicle; explosion; fire, hail; lighting, malicious mischief or vandalism; riot or civil disturbance; smoke; or windstorm. Limit: $25,000 Each Event/$100,000 Annual Aggregate * Pollution Claims MUST be reported within 30 days of the discovery in order for coverage to apply. Additional Premium: $ 3,542 St. Paul Fire and Marine Insurance Company Quotation for Equipment Breakdown Coverage Property Protection Coverage Summary- Continued -Form No. 42497(8-90) for use with Equipment Breakdown Endorsement-Form No. 42486(8-90) ISSUED DATE: April 4,2002 QUOTE EXPIRES ON: May 19,2002 QUOTE NUMBER: EBE-0143563-00(04) DECLARATION NO: 1 of 1 NAMED INSURED: Truckee Donner Public Utility District EFFECTIVE DATE: May 1,2002 ST PAUL POLICY NO: Client Company Policy No.:Not Provided Coverage Options and Description: ❑ Basic Accident Coverage Coverage includes boilers,vessels and piping. ® Comprehensive Accident Coverage Includes but is not limited to boilers,pressure vessels,refrigeration or air conditioning equipment, production and process machines, and any mechanical or electrical machine or apparatus used for the generation, transmission or utilization of mechanical or electrical power. Coverage Limit of Coverage Property Damage S 7,500,000. Coverage Extensions Limit of Coverage Expediting Expense $ 100,000 Pollution Cleanup(Includes AMC) $ 100,000 Water Damage(As Result of Accident) Included Optional Coverages Limit of Coverage Business Income(BI) Not Covered Blanket Earnings and Expense(EE) Not Covered Extra Expense $ 50,000 Spoilage $ 100,000 Deductible Your deductibles shown in the Property Protection Coverage Summary applicable to property damage,business income or blanket earnings and expense apply to loss under this coverage unless a specific deductible is shown below: Combined,All Coverages $5,000. Except Transformers $1.50 Per KVA,$5,000 Minimum Except ICE/Generator units $30.00 Per Horsepower, $5,000 Minimum Additional Notes: Cogeneration Facilities are excluded. Transformers with windings=>30 years old:valued at Actual Cash Value Annual Premium: $15,750 BOILER & MACHINERY Type of Insurance: Boiler and Machinery Carrier: Continental Casualty Company(CNA) A.M.Best's Rating: A XV(Excellent) Policy Term: May 1,2002 to May 1,2003 Annual Premium: $12,930 Sub-Station Locations: 1. Southeast comer of Keiser Ave&Jibboom Street,Truckee, CA 2. Southside of Donner Lake Road between I-80 &Cedar Point Drive,Donner Lake, CA 3. East of Skislope Way between Bermgarten Road&Northwoods Blvd., Tahoe Donner,CA 4. North of Riverview Drive, South of Truckee River,Truckee,CA Description of Coverage: Comprehensive Boiler&Machinery Coverage,excluding production machin- ery. Pays for direct damage to property you own,property in your care,custody and control,and for which you are legally liable, caused by an"Accident"to an "Object,"as defined. Limits of Liability: $ 7,500,000 Any one accident including Property Damage $ 100,000 Expediting Expenses $ 100,000 Hazardous Substance/Cleanup&Disposal $ 100,000 Ammonia Contamination $ 100,000 Water Damage Deductibles: $ 10,000 All Objects except Transformers $ 1.501KVA Transformers,subject to a minimum of$10,000 Valuation: Actual Cash Value applicable objects 20 years old or older Transformers will be considered new as of date of last rewind Major Exclusions: • Enforcement of Ordinance or Law (including but not •Nuclear Hazard limited to) • War and Military Action • Explosion,except loss caused by or resulting from an explosion of a covered "object"(see Object Definitions Endorsement) •Fire or explosion that occurs at the same time as or ensues from an"accident," or an"accident'that is the direct or indirect result of an explosion or fire • Water damage as a result of attempt to extinguish fire • Lightning •Flood "Accident"to an"object"while being tested • Earth Movement •Power Failure • Business Interruption • Any indirect result of an"accident"to an"object" •Underground electrical wiring not in conduit whether damaged directly or indirectly as the result of an accident ENERGY MAX Type of Insurance: Boiler and Machinery Carrier: Travelers A.M.Best's Rating: A++ Policy Term: May 1, 2002 to May 1,2003 Annual Premium: $17.866 Sub-Station Locations: 1. Southeast comer of Keiser Ave&Jibboom Street,Truckee, CA 2. Southside of Donner Lake Road between I-80&Cedar Point Drive,Donner Lake, CA 3. East of Skislope Way between Bermgarten Road&Northwoods Blvd., Tahoe Donner, CA 4. North of Riverview Drive, South of Truckee River,Truckee, CA Description of Coverage: Comprehensive Boiler&Machinery Coverage. Coverage includes breakdown of critical mechanical or electrical equipment,including:boilers,pressure ves- sels,air conditioning units, transformers and electrical switchgear. Special Features: • Definition of"Object"includes production machinery,telephone systems, computers, office equipment, fiber optic cables,and air conditioning units and systems. •No "solely supplying requirement for Off Premises Service Interruption. •New Generation Extension coverage pays for replacing damaged equipment with new,more efficient technology,at up to 125%of replacement value. •No sublimits for loss of CFC Refrigerants,Equipment Breakdown,and/or Computer Equipment. All are included under the full Direct Damage coverage limit. •Additional coverages include Media,Ordinance or Law,Newly Acquired Locations,Errors in Description,Defense,Brands and Labels,and Loss Adjustment Agreement. Limits of Liability: $7,500,000 Any one accident including Property Damage $ 100,000 Expediting Expenses $ 100,000 Hazardous Substance/Cleanup &Disposal $ 100,000 Ammonia Contamination $ 100,000 Water Damage $ 100,000 Ordinance or Law $ 100,000 "Media" $ 100,000 Newly Acquired Locations(90 days) $ 100,000 Error in Description Deductibles: $ 40,000 All "Objects" at the four scheduled substation locations $ 10,000 All other"Objects" Valuation: Actual Cash Value applicable objects 20 years old or older Transformers will be considered new as of date of last rewind Provisions: • Joint Loss Agreement (including but not limited to) • Computer Equipment •New Generation • In Use/Connected Ready for Use • Repair or Replacement •Perils Elimination Endorsement BMT3800200 • Y2K Exclusion Endorsement ILT355 EARTHQUAKE & FLOOD (DIFFERENCE IN CONDITIONS) Type of Insurance: Difference in Conditions Including Earthquake&Flood Carrier: Royal Indemnity Company A.M.Best's Rating: A YIV(Excellent) Term: May 1,2002 to May 1,2003 Annual Premium: $30,632 Description of Coverage: Provides coverage for all risks to direct physical loss,including Earthquake and Flood,up to the policy limit. Limits subject to the deductible,where applicable. Total Insurable Values: $23,116,979 Limits of Liability: $5,000,000 per Occurrence and in the Annual Aggregate $5,000,000 per Occurrence and in the Annual Aggregate for Flood $5,000,000 per Occurrence and in the Annual Aggregate for Earthquake $ 367,500 Sublimit for Extra Expense Deductible: $ 25,000 Per Occurrence All Other Perils except: 5%of values at time and place of loss, subject to a $25,000 per occurrence minimum for Flood $25,000 per occurrence minimum for Earthquake Valuation: Replacement Cost except Actual Loss Sustained on Time Element Major Exclusions: (Including but not limited to) • Loss or Damage covered under a standard property policy including,but not limited to: fire,lightening,vandalism,malicious mischief and sprinkler leakage; • War,insurrection,rebellion,revolution,civil war; •Nuclear reaction or radiation; • Electrical injury or disturbance; • Explosion or rupture of pressure vessels; • Wear and tear,deterioration,mechanical breakdown,vermin,termites, or other insects, etc.; •Failure to act or decide,of any persons,organization or governmental body; a) Zoning development and/or site preparation; b) Design,repair, construction,renovation or compaction; e) Materials used in repair,construction,renovation or remodeling. d) Maintenance. • Power interruption or power failure. • Exclusion&-Limited Additional Coverage for Fungus—IM&Manuscript •Total Exclusion—Electronic Property and Virus • Exclusion of Terrorism FIDUCIARY LIABILITY Type of Insurance: Corporate Fiduciary Liability(Claims-Made) Carrier: U.S. Specialty Insurance Company A.M. Best's Rating: A+ Term: May 1,2002 to May 1,2003 Premium: $2,000 Limits of Liability: $1,000,000 full Cap penalty coverage and defense for man- aged care exposures Covered Plan: Truckee Donner Public Utility District Defined Benefit Pen- sion Plan and any plan as defined in section 3 (1)of ERISA Description of Coverage: Pays on behalf of Insured for all Loss and Defense Costs which the Insured is legally obligated to pay solely because of a claim first made against the Insured during the Policy Pe- riod,for a Wrongful Act committed or allegedly committed by the Insured or by any person for whom the Insured is legally responsible. "Insured"means: I. the Sponsor Organization named as Truckee Donner Pub- lic Utility District in item 2 of the Declarations 2. the Employee Benefit Plan named in item 1 of the Decla- rations including the Truckee Donner Public Utility Dis- trict Defined Benefit Pension Plan as endorsed,and 3. any past,present, or future director,officer,employee,or trustee of the Sponsor Organization or Sponsored Plan,or the estates,heirs,legal representatives,or assign of such persons who are decreased, or incompetent,and the spouses of such persons,but only to the extent that claims are asserted against spouses arising solely out of any ac- tual or alleged wrongful acts of the spouse who is an In- sured under this definition. Deductible: None Major Exclusions: The Carrier shall not be liable to pay any Loss or Defense Costs with Respect to any claim made against any Insured: • Based on or involving facts the Insured has reasonable basis to believe might lead to a claim at the original effective date; • Based on or involving facts or circumstances which the Insured has notified to a prior insurer; •For Bodily Injury and Property Damage, including libel and slander; •For failure to procure or maintain adequate insurance; • Based on or involving seepage,pollution or contamination of any kind. � r DIRECTORS AND OFFICERS LIABILITY (WITH PUBLIC OFFICIALS EXTENSION) Type of Insu ran cc: Directors and Officers Liability(with Public Officials Extension) Carrier: Royal Indemnity Company A.M.Best's Rating: A+IX Term: May 1,2002 to May 1,2003 Limits of Liability: Option 1 $5,000,000 Option 2 $3,000,000 Retention: $25,000 Each Claim Annual Premium: Option 1 $30,000 Option 2 $22,400 Endorsements and Exclusions: (Including but not limited to) •Nuclear Energy Liability Exclusion •Allocation and Change in Exposure endorsement • Marital Estate Extension • Public Officials Extension—Defense within the limit •Prior&pending litigation •Bilateral Discovery Endorsement— 1 year at 75%a/p •Professional E&O Exclusion—POL. Subjectivities Prior to Binding: • Original fully completed signed and dated RSUI main form D&O application •Originally fully completed signed and dated RSUI Entity Coverage Extension questionnaire • Complete copy of the by-laws • Current audited financials • Complete loss history EMPLOYMENT PRACTICE LIABILITY Type of Insurance: Employment Practice Liability Carrier: National Union Fire Insurance Company of Pittsburgh A.M. Best's Rating: A++ Term: May 1, 2002 to May 1,2003 Limits of Liability: $5,000,000 Deductible: Option 1 $25,000 Each Wrongful Act $25,000 Each Employment Practices Violation Option 2 $50,000 Each Wrongful Act $50,000 Each Employment Practices Violation Annual Premium: Option 1 $29,100 Option 2 $26,794 Endorsements and Exclusions: (Including but not limited to) • California Cancellation/NonRenewal • Capacity Commitment Exclusion •Bond Exclusion •Professional Liability Exclusion(architects,engineers, lawyers) •Absolute War&Terrorism Exclusion •Intellectual Property Exclusion •Utility endorsement#POLNUTIL.NL N •Water-Sewer-Sanitation Authorities#POLNNWSA.man Subjectivities Prior to Binding. • Latest Financials • Loss Runs • Employee Handbook • Completed and Signed MumPro application •Information regarding outstanding litigation activities(as mentioned in the Agenda,USA Media and One additional potential litigation) •Latest audited financials • 2002 Budget including revenues and expenditures While we believe this Insurance Quotation fairly represents the terms, conditions and exclusions found in the insurance policy, in the event of any differences between the policy and quotation, the policy will direct any resolution. This quotation does not replace or supersede the policy. Truckee Donner PUD Premium Comparison Summary Coverage Proposed Premiums Actual Premium Actual Premium Actual Premium Description 2002/ 2003 2001/2002 2000/2001 1999/2000 Property,Cargo Equipment,Inland $ 54,025 $ 43,935 $ 30,203 $ 29,920 Marine Crime $ 1,500 $ 1,500 $ 1,500 $ 1,500 General Liability $ 123,247 $ 84,544 $ 70,242 $ 68,517 Automobile Liability $ 40,216 $ 31,322 $ 22,792 $ 19,175 Umbrella $ 48,278 $ 25,163 $ 22,809 $ 22,400 Pollution Liability $ 3,542 $ 2,696 $ 2,477 $ 2,488 Voluntary Property $ 5,903 $ 4,493 $ 4,128 $ 4,147 Damage EMF Liability $ 2,361 $ 1,797 $ 1,714 $ 1,714 Boiler&Machinery $ 10,352 $ 9,002 $ 8,492 CNA Quote* $ 12,930 Traneler'r B&MQuote* $ 17,866 St.Paul,Quole* $ 15,750 Earthquake& Flood $ 30,632 $ 23,565 $ 15,500 $ 15,500 $25,000/$SMM limit Fiduciary Liability $ 2,000 $ 2,200 $ 2,200 $ 2,200 1 MMLirnit/$0 Deductible Public Officials D&O $ 14,561 $ 12,456 $ 11,288 Option I-$9,000,000/$29,000 Ded* $ 30,000 Option 2-$3,000,000/$25,000 Ded* $ 22,400 $ 246,128 $ 195,023 $ 187,341 Employment Practices Liability Option 1 -$5,000,000/$25,000 Ded* $ 29,100 Option 2-$5,000,000/$50,000 Ded* $ 26,704 *Quotes with Optional Coverage Purchases Truckee Donner PUD Premium Comparison Summary Coverage Proposed Premiums Actual Premium Actual Premium Actual Premium Description 2002/2003 2001/2002 2000/2001 1999 J 2000 Property,Cargo Equipment,Inland $ 54,025 $ 43,935 $ 30,203 $ 29,920 Marine Crime $ 1,500 $ 1,500 $ 1,500 $ 1,500 General Liability $ 123,247 $ 84,544 $ 70,242 $ 68,517 Automobile Liability $ 40,216 $ 31,322 $ 22,792 $ 19,175 Umbrella $ 48,278 $ 25,163 $ 22,809 $ 22,400 Pollution Liability $ 3,542 $ 2,696 $ 2,477 $ 2,488 Voluntary Property $ 5,903 $ 4,493 $ 4,128 $ 4,147 Damage EMF Liability $ 2,361 $ 1,797 $ 1,714 $ 1,714 Boiler&Machinery $ 10,352 $ 9,002 $ 8,492 CNA Quote* $ 12,930 Traveler's B&MQuote* $ 17,866 St.Paul Quote* $ 15,750 Earthquake&Flood $ 30,632 $ 23,565 $ 15,500 $ 15,500 $25,000/$5MM Limit Fiduciary Liability $ 2,000 $ 2,200 $ 2,200 $ 2,200 1 MMLimit/$0 Deductible Public Officials D&O $ 14,561 $ 12,456 $ 11,288 Option l-$9,000,000/$29,000 Ded* $ 30,000 Option 2-$3,000,000/$25,000 Ded* $ 22,400 $ 246,128 $ 195,023 $ 187,341 Employment Practices Liability Option 7 -$5,000,000/$25,000 Ded* $ 29,100 Option 2-$5,000,000/$50,000 Ded* $ 26,704 *Quotes with Optional Coverage Purchases All RED equals $ 354,634