Memorandum

City of Lawrence

City Manager’s Office

To:	David Corliss, City Manager
CC:	Diane Stoddard, Toni Wheeler, Casey Toomay,  Brandon McGuire,  Angela Navarro
FROM:	Gary Cooper, Risk Manager
DATE:	May 5, 2015
RE:	5/18/15 to 5/18/16 RENEWAL Professional Liability Law Enforcement Policy

Background

The City maintains a $1 Million liability limit policy including a $75,000 deductible with AIG/Lexington Insurance Company and utilizes the Hays Companies of Kansas City as our broker. 

Renewal Process

The City’s broker advised we stay with AIG for this renewal.  The market for law enforcement coverage revolves around three to four carriers.    AIG is the very best carrier for this coverage.  AIG provides coverage for our hard to place Public Officials policy which is also renewing at the same time.   This enables the City to leverage the two policies together to make sure we have optimal coverage and pricing.

The expiring premium for the 5/18/14 to 5/18/15 policy was $65,650.  The 5/18/15 to 5/18/16 policy renewal premium is $68,680, a 4.6% increase.

The increase is due to insurance industry concerns regarding law enforcement excessive force issues across the country.  As these events continue, the future rates will continue to increase. Plus, the fact that only three to four carriers write this coverage means they can dictate rates and premium.

The City has been with AIG/ Lexington for four continuous policy periods.

Recommended Action

Staff recommends renewing coverage with AIG/Lexington for the Professional Liability Law Enforcement policy at the $68.680 premium for the 2015 to 2016 policy period.