HomeMy WebLinkAboutR-78-0476RFC bk
6/29/78
RESOLUTION No. 78 - 47 6
A RESOLUTION ACCEPTING THE BID FROM UNITED
NATIONAL CO., THROUGH ITS LOCAL AGENT CHALLENGE
INSURANCE, INC., TO ISSUE A PUBLIC LIABILITY
INSURANCE POLICY COVERING CITY -OWNED PARKS,
POOLS & PLAYGROUNDS, IN THE AMOUNT OF $50,000
PER ACCIDENT, $100,000 PER OCCURRENCE FOR
BODILY INJURY AND $50,000 FOR PROPERTY
DAMAGE, FOR A THREE (3) YEAR PERIOD AT AN
ANNUAL PREMIUM OF $90,000 WITH A $1,000 DEDUCT-
IBLE PER OCCURRENCE, SAID DEDUCTIBLE DISAPPEARING
AFTER $25,000 HAS BEEN EXPENDED IN ANY POLICY YEAR.
WHEREAS, pursuant to Public Notice, a sealed bid was
received May 26, 1978, to provide Public Liability Insurance to
cover City -owned Parks, Pools & Playgrounds in the amount of
Fifty Thousand ($50,000.00) Dollars per accident, and One
Hundred Thousand ($100,000.00) Dollars per occurrence, for a
three (3) year period, and
WHEREAS, invitations were mailed to seventy-four (74)
insurance agents and the one (1) bid received was not in full
compliance with specifications, and
WHEREAS, a survey of the insurance market revealed
resolicitation would not attract additional bids, and
WHEREAS, negotiations brought the only bid into full
compliance with the specifications, and "DOCU�F�T DEX
WHEREAS, the City Manager recommends tg trV't1 o41..y_
received and subsequently amended to be in full compliance with
the specifications be accepted from United National Insurance Co.,
through its local agent Challenge Insurance, Inc., to provide
Public Liability insurance in the amounts of $50,000 per Accident,
$100,000 per occurrence for Bodily Injury, covering City -owned
Parks, Pools & Playgrounds for a three (3) year period, at an
annual premium of Ninety Thousand ($90,000.00 Dollars),with a
One Thousand ($1,000.00) Dollar Deductible per occurrence with a
Twenty -Five Thousand ($25,000,00) Dollar disappearing deductible
clause per policy year;
NOW, THEREFORE,
BE IT RESOLVED BY THE COMMISSION OF
THE CITY OF MIAMI, FLORIDA;
CITY COMMISSION
MEETING OF
J U L 1 3 1978
Rno„ .. . .1..7
ITEM ---
BID SECURITY
-4 DATE Bibs RECEIVEb
4.61•16.•
BIDDER
s.2C'6'
•
TYPE OF tecuRitv
AMOUNT
#6R
ACCOUNTING
USE
ti7C
Received the above describtcl checks this,,, cloy of 19
FOR ACCOUNTING DIVISION
Section 1► That the bid received stay 26, 1978 for furnishing Public
Liability insurance in the amounts of $50,000 per accident and
$100,000 per occurrence Bodily Injury; $50,000 Property Damage, be
accepted for a three (3) year period at an annual premium of
$90,000.00 with a $1,000 deductible per occurrence disappearing after
$25,000 in any one policy year, from United National Insurance Co.,
through its local agent, Challenge Insurance, Inc..
PASSED AND ADOPTED THIS 13 day of JULY , 1978.
MAURICE A. FERRE
e,
RAL: I G. O tIE, CITY CLERK
PREPARED AND APPROVED BY:
e4— ;t. ee4,4t:
ASSISTANT CITY ATTORNEY
APPROVED AS TO FORM AND CORRECTNESS:
FORGE F. KNOX, J
RNEY
MAYOR
7 8 - I 7 6
1 0:
.4
Joseph Eta Grassie
City Manager
ames );. Gunderson
irector of Finance
CITY OF MIAMI, A.Ot2IOA
iNTER,OFP1Cit MEN1ORANt)UM
D E.
el •i
Put
Attie 20, 1978
Acceptance of Bid parks, Pools &
Playgrounds insurance Policy
pursuant to public Notice, sealed Bids were received May 26, 1978, to provide Public
Liability Insurance coverage for City owned Parks, pools & Playgrounds in the amounts
of $50,000 per Accident and $100,000 per Occurrence, which will replace a policy
written by Lincoln Insurance Company. This coverage, written by Lincoln Insurance
Company from 6/1/77 to 6/1/78 ordinarily would have been renewed for the next year.
However, because of their Loss Experience, Lincoln Insurance notified the City on
March 1, 1978 that unless the City would provide an additional $65,000 premium over
the annual base premium of $40,000 for the remainder of the policy year, they would
have no recourse but to terminate this coverage. If the City accepted this short-term
increase, the premium for 6/1/78 - 6/1/79 would then become $90,000 annually.
Investigation revealed that to self -insure this risk, it would cost approximately
$35,000 to provide staff and equipment by the Law Department, to handle this addition-
al work load. Based on the City's claims experience, the remaining $65,000 out of the
$100,000 budgeted for this premium would be inadequate.
The Insurance Committee reviewed all factors and recommended that specifications be
prepared and bids solicited to provide coverage for this risk. Invitations were mailed
to seventy-four (74) insurance agents, and one bid was received as follows:
United National Insurance Co.
Local Agent: Challenge Insurance, Inc.
Annual Premium: $95,000
Deductible: $5,000 per Occurrence
This bid did not meet specifications as to:
1.. Financial Strength of Company -(Did not meet minimum requirements.)
2. Premium exceeded the amount budgeted.
In order to correct these deficiencies it was necessary to negotiate with the Local
Agent. Before these negotiations began, however, contact was made with the leading
insurance agencies in Dade County as to the reasons no bids were received, and, if
this proposal was bid again, could the City anticipate a bid that would meet the
specifications. The replies were in the negative as to receiving a bid that would meet
the City's criteria. As to "why" no bids, the reasons were many and varied, with the
over-riding one that "the Municipal risk is too great."
The local agent was able to correct the deficiencies in the following manner:
78-476
June 20) 1918
Mr• Joseph Grassie
City Manager
Page 2 of 2 Memorandum
continued
1. That an insurance company with sufficient financial strength
Would guarantee all payments to the limits of the policy;
2. That the premium would be adjusted to $90,000 annually, with
a deductible of $1,000 per Occurrence; said Deductible would
disappear if it exceeded $25,000 in a policy year.
Based on the factors as outlined, it is recommended that the Bid from United National
Insurance Co. be accepted to provide Public Liability Insurance in the amount of
$50,000 per Accident, $100,000 per Occurrence for an annual premium of $90,000 with
a $1,000 Deductible per Occurrence, disappearing at $25,000 per year for a three (3)
year period, effective policy date, one day after approval of City Commission.
JEG:DRS:et
cc: Mr. George F. Knox, Jr.
City Attorney
Mr. Howard Gary, Director
Department of Management & Budget