Agenda Packets - 1985/12/16 - Laserfiche WebLink

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to December 11, 1985 Page 2 premiums are deposit premiums, that is, they are based upon estimates and are subject to final audit and billing adjustment after the policy has expired. Corporate Risk Managers has assisted City staff in reviewing these audits. In one instance as a consequence of reviewal of Corporate Risk Managers the auait premium was adjusted downward resulting in a savings of premium dollar for the City. The task of reviewing these audits has been made more difficult by the lack of cooperation of our insurance agent and/or insurance company. In order to properly review these premium audits it is necessary to obtain copies of the auditor's work papers as well as copies of the underwriter's work papers which were used to establish the initial deposit of premium. We have been able to obtain copies of the auditor's work papers for the last two audits, however, we have been able to obtain the underwriter's work papers only with great difficulty. we received a billing as a result of an audit in Ju1v and have not been able to determine whether the additional premium requested by the insurance company is justified due to failure of the agent and/or insurance company to pravide us with copies of the undvrwriter's work papers. We encountered this same problem last year. Another area in which having an insurance and risk management consultant h&s been proven to be extremely valuable to the City is in the area of the review of the policies issued by the insurance cc.apany and comparing the coverages contained in those policies to the insurance specifications which the agent bid on. In 1984 there were approximately one-half to three-quarters of a dozen variances between coverages in the actual policies as compared to coverages bit. After correspondence and several telephone calls we were able to straighten out the discrepancies and have policies issued which were the same as the coverages bid. Thin year the policies for our May 1, 1985 renewal were not received until mid November. Those policies contain several instances in which coverages bid were not contained in the policies issued. staff and the consultant are in the process of contacting the agent and/or insurance companies involved and having these mattes corrected. It is, however, discouraging to receive policies which are at variance with coverages which were bid. These discrepancies could prove to be quite a serious matter should a loss occur prior to those discrepancies being resolved. I am quite concerned about the future ability of the City to obtain adequate insurance coverages considering the current .insurance crisis' being faced by many governmental entities nationwide. I have been advised by our insurance and risk management consultant, as well as by other metro area finance