|DATE:||Tuesday, April 04, 2017|
|TO:||School Board Members|
|FROM:||Jeff Eakins, Superintendent|
|SUBJECT / RECOMMENDATIONS|
|Approve the Purchase of Quoted Excess Property Insurance Program|
|Hillsborough County Public Schools purchases insurance for excess property coverage due to perils such as fire, flood, windstorm, etc. The coverage renews May 1, 2017. An excess property insurance history is captured in Attachment A.
For this renewal, coverage limits will be increased to $250,000,000 and the $10,000,000 self-insured retention is fully eliminated. The deductible for named windstorm-flood remains at 5% with a minimum deductible of $250,000. The deductible for all other perils remains at $100,000. This renewal also includes auto physical damage coverage for district vehicles and buses with a $10,000 deductible. This coverage was not part of the expiring program.
The district's insured values have increased from May 1, 2016, by $261,566,864 to $5,512,406,698; an increase of 4.98%. A list of insurance carriers contacted is included as Attachment B.
The 12-month excess property insurance premium will be $6,242,250 (not inclusive of taxes and fees) which is a 5.0% decrease from the 2016 annual renewal based on the increased TIV at the expiring rate (Attachment A).
The district's insurance broker has recommended coverage in the amount of $250,000,000 with the Probable Maximum Loss for a 250 year storm of $216,991,642. The Florida Office of Insurance Regulation will be petitioned for validation that this amount meets the requirements for reasonable insurance coverage of the Stafford Act (Attachment C and D).
The district's broker, First Florida Insurance Brokers (FFIB), receives a 6% commission, capped at $279,566. The industry standard revenue (at 6%), with no cap, would be $374,535. Given the contract in place with FFIB, this is a savings of $94,969. In addition, our contract with FFIB limits the wholesaler’s commission to 3.5% (industry standard on wholesale commission is 5-7.5%) generating a savings between $102,634 and $249,690.
|• Demonstrate "best practices" in all aspects of safety: student, employee, visitor, facility, transportation, and health|
|FINANCIAL IMPACT (Budgeted: Yes)|
|The annual 12-month excess property insurance premium of $6,242,250 (plus taxes and assessments) is a 5.0% decrease from the 2016-2017 budget, based on the increased TIV at the expiring rate.|
|SUBMITTED BY: Glen Lathers, Director of Risk Management and Safety|
|Stephanie F. Woodford||Dr. Alberto Vázquez|
|Chief Human Resources Officer
|Chief of Staff
|Hillsborough County Public Schools (Florida) * Mtg.#20170404_809 (Board Meeting) * Section C Item# 4.06|