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Case #2 AGENT OF RECORD BIDS By: Kay McAIoney, Personnel Coordinator Background: On December 14, 1991 the current Insurance Service Agreement with Agent of Record Michael Hadtrath and the City of Ramsay will expire. The upcoming term of service would begin December 15, 1991 and continue and remain in effect for a period of three years, unless it is terminated prior to December 14, 1994 by either party giving the other ninety days prior written notice of termination. The City of Ramsey agrees to engage the services of the Agent of Record as: Insurance Servicing Agent of Record with respect to all Insurance of the City within the scope of Professional Liability, Fire, Workers' Compensation, Casualty and Marine Insurance, and Fidelity and Surety Bonds. The Agent of Record shall also act in the dual capacity of Risk Management Advisor and Insurance Agent. A copy of the Ci'ty's Advertisement for Bids is enclosed. Bids were accepted until 11:00 a.m. September 30, 1991. Two bids were received for Agent of Record, one bid was received for Risk Management services. Mr. W. E. Husbands of Husbands Independent Risk Management Company, inc. submitted a proposal to the City for Risk Management services; a copy is enclosed. Mr. Husbands' firm would not perform as the City's Insurance Agent of Record as he does not self insurance. Mr. Peter Tritz from the League of Minnesota Cities Insurance Trust (LMCIT) was contacted to ascertain whether or not the City must have an Agent of Record for Comprehensive Property and Casualty, and Workers' Compensation. Mr. Tritz stated that we must have an Agent of Record for the Property and Casualty, but an Agent of Record is optional for the Workers' Compensation Insurance. What this means is that in addition to the services of Mr. Husbands', the City would also need to retain an Insurance Agent of Record for basically all insurances except Workers' Compensation, and this Agent would receive either a commission on these policies or a flat fee from the City. Due to the resulting higher cost of this arrangement, we did not pursue Mr. Husbands' proposal at this time. As Insurance Agent of Record, the City received two proposals. One from Michael Hadtrath of Hadtrath & Associates, our current Agent of Record, at a flat fee of $2,000 per year for the next three years. The other proposal is from Conway Olson of T. C. Fields, the City's former Agent of Record, at a flat fee of $4,061 per year for LMCIT policies plus commission on non-LMCIT for the next three years.' Enclosed are the proposals received. Due to the nature of professional services, the City's selection for insurance Agent of Record need not be based solely on the Iow bid. As we discussed earlier this evening, the City has realized significant cost increases for the policy year beginning October 1, 1991. It is imperative that our Agent of Record and Staff work together to minimize risk and reduce overall insurance costs. By definition risk management is the method for dealing with risks to which an organization is exposed by identifying all exposures and creating programs to handle them. To assist us in this process, our I have contacted references given by both firms.