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<br /> We have recently been provided an interim, unaudited statement for the period `
<br /> October 1 , 2000 through June 30, 2001 , which shows losses slowed during the
<br /> first 3 quarters to $2 , 449,469 . In correspondence dated August 15, 2001 , which
<br /> accompanied that interim statement, The Florida League of Cities ' Director of
<br /> Public Risk Services, Michael P . Madden, advised that " we feel confident
<br /> that by year end we will be in the black, absent any major catastrophe . "
<br /> Even with their recent further assurances that the problems have been correaed
<br /> and that they expect to be profitable this year, we continue to be concerned . We
<br /> should note that FL1IT is not assessable and, if they do become insolvent, the risk
<br /> to the County would be any unpaid claims.
<br /> Cost
<br /> The package proposals received represent a significant increase in costs for the
<br /> County . These increased costs are artributed to the limited insurers interested in
<br /> public entity business and the difficult insurance market in general . The
<br /> insurance costs of the proposed packages summarized as follows '
<br /> Coveraee IN T� pro _vola/ Gallazher Prorwsal
<br /> Package $ 760, 732 $8443782
<br /> Crime 5 7 S 5. 817
<br /> $76610549 5850, 599
<br /> Tirorkers ' Conrpenralion Retention
<br /> The current workers ' compensation self-insured retention is $ 150
<br /> Gallagher proposal ' , 000 and the
<br /> s is 5250, 000 . Over the past 5 years, the County has
<br /> experienced four claims anticipated to cost over $ 150, 000 . Based upon the
<br /> current valuation of these claims, the average annual amount of loss that would be
<br /> retained by the County is approximately $67, 000 .
<br /> Crime Coverages
<br /> The Gallagher package included crime coverage with limits of $ 100, 000. Current
<br /> employee dishonesty limits of coverage are 51 , 000, 000 for specified positions .
<br /> Gallagher also provided a separate, stand -alone crime proposal with a deductible
<br /> of $ 10, 000 and the higher requested limits. It is recommended that the County
<br /> negotiate with Gallagher to coordinate the crime coverages so that the higher
<br /> limits are purchased . Depending upon underv,riting considerations, acceptable
<br /> options would be to either exclude crime coverage from the package, for a
<br /> premium savings, and purchase the stand-alone crime coverage or amend the
<br /> stand-alone proposal, for a premium savings, to have a deductible of $ 100, 000 so
<br /> that coverage can be excess the package coverage .
<br /> Casualty .Aggregates
<br /> The Gallagher package proposal indicates that the Public Officials ' Errors and
<br /> Omissions Liability, Employment Related Practices, and Employee Benefits
<br /> Liability coverages include annual aggregates of $ 900 , 000 . This is a significant
<br /> difference in coverage between the current coverage, which has no aggregates for
<br /> these coverages, and the Gallagher proposal . It is recommended that the Count,
<br /> attempt to negotiate, perhaps at an additional premium, aggregates for these
<br /> coverages of at least three times the per claim limit.
<br /> SEPTEMBER 18 2001 1V( Irp In 10
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