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TO: Mayor Richard C. Irvin
FROM: Alex G. Alexandrou, Chief Management Officer
DATE: April 19, 2019
SUBJECT:
A Resolution Authorizing the Purchase of Pollution Liability Insurance for the Period of March 31, 2019 through March 31, 2022
PURPOSE:
To obtain approval to purchase Pollution Liability Insurance for the period of March 31, 2019 through March 31, 2022.
BACKGROUND:
The City has had in place for the past three (3) years a ten ($10) million dollar pollution liability insurance policy with a $250,000 self-insured deductible amount from Allied World Assurance Company (AWAC) as an essential component of its overall self-insurance liability program for any pollution claims against the City. This expiring three (3) year policy inclusive of the premium, applicable taxes and broker fee totaled $80,123.00.
DISCUSSION:
The City's broker, Hub International, reviewed the existing coverage for adequacy, updated the City's schedule of covered locations and surveyed the market conditions for pollution liability coverage. Other markets contacted were either not competitive or could not match the current coverage offered by AWAC. The recommendation is to accept the three (3) year renewal quote from incumbent Allied World Assurance Company (AWAC). Attached as reference is a premium summary and coverage terms. The overall renewal rate is flat and the three (3) year policy has increased by approximately $5,000 due to an eight percent (8%) increase in ratable coverage square footage of new city-owned properties since 2016. In addition Hub was able to negotiate the addition of automatic grant of coverage for inclusion of newly acquired properties. AWAC's premium quote inclusive of premium and taxes is $85,840.00. Hub is not charging a broker fee for this transaction. AWAC is highly rated in terms of financial stability and ability to pay claims. $100,000 was allocated in 2019 for pollution liability insurance are budgeted in account #601-0000-410.40-01.
IMPAC...
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