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HomeMy WebLinkAboutPP-Property Insurance Renewal 2019MWMC Regional Wastewater Program Property Insurance Renewal July 1, 2019 Good Morning 1 4/13/18 MWMC Preliminary Budget & Rates FY18-19 MWMC Property & Liability Insurance Premium Trend – Looking Back MWMC Preliminary Budget & Rates FY18-19 4/13/18 2 MWMC Property Coverage Renewal Premium – July 1, 2019 Property Insurance Deductible Currently = $250,000, with some exceptions that result in a greater deductible EXPLAIN DIC – Difference in Conditions Follow-up on Commission member’s request for premium savings amounts with large deductibles $2M; $5M Starr Tech Premium reductions with a higher deductible would include: Current premium: $213,435 $500,000 ($12,700 or 6%) reduction; $200,423 premium $1 million ($21,200 or 10%) $192,282 $2 million ($29,100 or 13.5%) reduction; $184,330 premium amount $5 million ($34,000 or 16%) reduction; $179,450 premium 3 4/13/18 MWMC Preliminary Budget & Rates FY18-19 After review and discussion, the Commission is requested by motion, to authorize and direct the General Manager to enter into agreements to secure property insurance coverage for the period of July 1, 2019 through June 30, 2020. Action Requested 4 4/13/18 MWMC Preliminary Budget & Rates FY18-19 5 4/13/18 MWMC Preliminary Budget & Rates FY18-19 MWMC Preliminary Budget & Rates FY18-19 4/13/18 6 US Earthquake Analysis MWMC Property Terms: OEP - Occurrence Exceedance Probability; AEP - Aggregate Exceedance Probability; AAL - Average Annual Loss; CV - Coefficient Variation; AAL – Average Annual Loss; CV – Coefficient Variation 7 4/13/18 MWMC Preliminary Budget & Rates FY18-19 Regional Partners Insurance Earthquake Coverage MWMC Preliminary Budget & Rates FY18-19 4/13/18 8 MWMC Property Insurance Planning Forward to FY 20-21 xes $100M earthquake coverage x$270,330 total premium xOption 2 – Includes $75M earthquake coverage $239,640 total; cost difference of $30,700 or 11% $25M reduction in EQ xOption 3 – Includes $50M earthquake coverage $213,435 total; cost difference of $56,900 or 21% $50M reduction in EQ coverage 9 4/13/18 MWMC Preliminary Budget & Rates FY18-19