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PROPERTY AND CASUALTY INSURANCE FOR 1992 <br />By: Kay McAIoney, Personnel Coordinator <br /> <br />Case #1 <br /> <br />Background: <br /> <br />The City of Ramsey has been notified of the cost of the 1992 premium for Comprehensive <br />Property and Casualty Insurance through the League of Minnesota Cities Insurance Trust <br />(LMCIT). The attached worksheet highlights each category and the percentage increase <br />associated for Property and Casualty. (Aisc attached is a copy of the loss run for <br />Property and Casualty, and Workers' Compensation showing claims.) The only City <br />i~'~surance not included in the worksheet is the Boiler and Workers' Compensation <br />policies. The Boiler policy for the coming year has not yet been received and the amount <br />of increase in the Workers' Compensation policy is explainable due to its direct <br />relationship to claims. A formula is used for Workers' Compensation that is consistent <br />and distributed to municipalities by Berkley stating how the experience modification is <br />determined. Aisc, along with the new premium is support information. This is not the <br />case for Property and Casualty coverage. <br /> <br />The premium for Property and Casualty coverage beginning'October 1, 1991 shows a <br />significant increase in cost. When the new premium was received there was no <br />explanation attached as to the reason for such an increase. When asked, City of Ramsey <br />Agent of Record Michael Hadtrath stated that the increase in the Property and Casualty <br />insurance is due to claims; mainly the litigation of Holmberg vs. the City of Ramsey. <br />City Staff including City Administrator Ryan Schroeder, Finance Officer Sandra Ashley <br />Helling, and I questioned as to why the large increase of over 30% overall, and <br />additionally the increase is spread over every section of coverage. The City of Ramsey <br />has not experienced a large number of claims since the tracking began in 1983, other <br />than the current litigation case. City Staff sent Mr. Hadtrath a list of questions in an <br />attempt to understand the large increase in premium. Mr Hadtrath stated that the City <br />has more equipment and higher expenditures which would increase the premium in <br />General Liability and Errors & Omissions. <br /> <br />These large premium increases came as a surprise to Staff, and we intend to pursue the <br />reasons for same. <br /> <br />Recommendation: <br /> <br />None, for information only. <br /> <br />Committee Action: <br />Based on discussion. <br /> <br />Review Checklist: <br /> <br />City Administrator <br />Finance Officer <br />Personnel Coordinator <br /> <br />BC:10/8/91 <br /> <br /> <br />