08/25/1997 Council Minutes - Laserfiche WebLink

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• COUNCIL MINUTES AUGUST 25, 1997 concluded that the coverage would be the same in most major areas with the following exceptions: 1. St. Paul Companies does not provide pollution liability to third parties for underground tank spills. Pollution cleanup with St. Paul Companies is limited to $25,000. A separate tank pollution policy is available at a premium of $2,500. This would have a limit of $1 million. Coverage would be primarily for cleanup and third - party liability. This policy pays even if Minnesota Petro Fund rejects a claim. The LMCIT does cover third -party claims and pollution cleanup. The limit is $215,000 plus $100,000 in defense costs. LMCIT coverage is supplemental to Minnesota Petro Fund and will not pay if Petro Fund does not pay. 2. Lead and asbestos pollution claims are excluded by St. Paul Companies. LMCIT does provide limited coverage. Separate coverage can be quoted by St. Paul Companies if details of asbestos are available. The above are not the only differences between the two contracts; however, most of the differences would not be of significant material difference. The underground tanks are an exposure that must be evaluated along with the lead and asbestos exposures. The other consideration is the estimated (not guaranteed) dividend from LMCIT. During the last five years, the City has averaged $13,051. Based on the above, if the City were to purchase the additional tank coverage with St. Paul Companies the St. Paul Property and Casualty premium would rise to $87,737 ($85,237 plus $2,500). If the City were to take into consideration the estimated (not guaranteed) dividend of $13,054 from LMCIT, the LMCIT net premium would be $88,527 ($101,581 less $13,054). The LMCIT coverage would cost $790 more than St. Paul Companies coverage. Workers Compensation Insurance The following is the premium comparison for Workers Compensation: LMCIT LMCIT St. Paul State Fund 1996/97 1997/98 1997/98 1997/98 $44,360* $54,087 $52,780 $51,177 (*Workers Compensation for 1996 was lower as estimated payrolls were much lower.) The State Fund was established by the State Legislature in 1983 to provide coverage to preferred safety -minded policyholders. They currently insure over 5,000 Minnesota employers including over 1,000 Minnesota Townships. All three quotes provide coverage as per the Minnesota Statutes. The quotes also include volunteer coverage. LMCIT and St. Paul are fixed cost plans. State Fund provides a retention plan that returns premiums if losses are less than 46% of the premium; however, there is no penalty if losses exceed 46%.