HCPS FL Logo Human Resources
Action Item
DATE: Tuesday, April 12, 2016
TO: School Board Members
FROM: Jeff Eakins, Superintendent
SUBJECT / RECOMMENDATIONS
Approve the Purchase of Quoted Excess Property Insurance Program
EXECUTIVE SUMMARY
Hillsborough County Public Schools purchases insurance for excess property coverage due to perils such as fire, flood, windstorm, etc. The coverage renews May 1, 2016, with limits set at $150,000,000. An excess property insurance history is captured in Attachment A

The district began to self-insure $10,000,000 of the primary layer (for Named Windstorm Only), creating a savings of $7,891,000 to the district (Attachment B). For the renewal this year, the self-insured retention will remain at $10,000,000 of the primary layer (for Named Windstorm Only). 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. 

The district’s insured values have increased from May 1, 2015, by $823,439,428 to $5,250,839,834; an increase of 18.6%. This increase is based on the appraisal that was conducted by HCA Asset Management during the summer of 2015. A list of insurance carriers contacted is included as Attachment C

The 12-month excess property insurance premium will be $6,279,801 (not inclusive of all Federal/State mandated fees) which is a 16.49% decrease from the 2015 annual renewal based on the increased TIV at the expiring rate (Attachment D)

The district’s insurance broker has recommended coverage in the amount of $150,000,000 with the Probable Maximum Loss for a 250 year storm of $342,502,397. 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 E)

The district’s broker, First Florida Insurance Broker (FFIB), receives a 6% commission, capped at $266,250. Given the contract in place with FFIB, this is a savings of $110,538. In addition, our contract with FFIB limits the wholesaler’s commission to 3.5% generating a savings of $94,197.

STRATEGIC OBJECTIVES
• Align the performance management system with the district's priorities • Demonstrate best financial practices • Demonstrate "best practices" in all aspects of safety including students, employees, visitors, facilities, transportation, and health
FINANCIAL IMPACT (Budgeted:  Yes)
The annual 12 month excess property insurance premium of $6,279,801 (plus taxes and assessments) is a 16.49% decrease from the 2015-2016 budget, based on the increased TIV at the expiring rate.
EVALUATION
Yearly renewal
SUBMITTED BY:  Glen Lathers, Director of Risk Management and Safety
    Stephanie F. Woodford

  Chief Human Resources Officer
(813) 840-7328
    C 4.07
Hillsborough County Public Schools (Florida) * Mtg.#20160412_758 (Board Meeting) * Section C Item# 4.07