HomeMy WebLinkAboutgr00090_000043_pg085April 25, 1977 Page 7
Councilmember Ziebarth questioned if stop signs would increase
the problem by backing up traffic. It was reported that the
highway may be finished in another two years which would solve
the problem.
MUNICIPAL LIABILITY INSURANCE BIDS. Admin. Achen reported that
the city sent letters to 50 insurance agents and firms inviting
them to participate in bidding. Complete specifications were
automatically sent to 10 of those agents who currently are active
in the municipal market. Three of the other agents receiving
letters requested and were sent complete specifications.
Only one bid was received from Larry Donohue of Donohue - Thornton,
who handles the present insurance. Gulf Insurance, who presently
provides the City's comprehensive general liability, multi -peril
and commercial umbrella coverages, is withdrawing from the
Minnesota market. Thus, the policy for the city will be cancelled
when it comes up for renewal at midnight April 30, 1977.
The existing coverage is based upon rates established in 1974.
Gulf's bid from 1974 provided constant, flat rates during the
entire three year policy period. However, there has been a rash
of recent lawsuits against public agencies, large corporations
and individuals who are wealthy. The bid received from Home
Insurance Co. is for $45,618 or nearly $25,000 more than what
was budgeted. However, Home Ins. will not provide umbrella
coverage or police liability. A good number of insurance firms
have lately been refusing to provide coverage in these areas due
to the apparent open -ended risks.
Home Insurance's bid of $45,618 is for the first year of a three
year period. Their rates may increase for both the remaining
years.
It was felt by the Councilmembers that umbrella coverage was needed
in case of a lawsuit in excess of the $300,000 maximum allowed
by the State, since Atty. Meyers stated that it is possible that
an award could be made in excess of the $300,000 maximum at any
time. Admin. Achen pointed out that if a City provides themselves
with more than $300,000 coverage, they are then open to lawsuits
above the $300,000. If they carried only the $300,000 coverage,
they could very possibly be sued in excess of $300,00 and have
damages awarded in excess of $300,000.
Mr. Dononue reported that he had gone to 12 different insurance
companies. Home Insurance was the only company that would bid
on the policy. The insurance companies have become very reluctant
to write coverage for municipalities.
Mayor Pickar asked if the insurance package that was put together
for the City of Mounds View was the most economical way to go.
Mr. Donohue replied that the only possible alternative would be to
hire a professional insurance consultant and have him look at the
various exposures the City has and draw up sepcifications and get
companies to bid on them. The present insurance coverage was drawn
from past coverage and the model League of Minnesota Cities