Report to Carson Reclamation Authority
Monday, June 03, 2024
Consent
SUBJECT:
Title
AUTHORIZE EXECUTIVE DIRECTOR TO APPROVE AND BIND COVERAGE ON A PUBLIC ENTITY LIABILITY POLICY FROM CHUBB COMPANIES USA, WRITTEN BY ACE AMERICAN INSURANCE COMPANY, PROCURED THROUGH MARSH USA, INC. IN AN AGGREGATE LIMIT OF NO MORE $10,000,000 AND A PREMIUM AMOUNT NOT TO EXCEED $180,490.00
Body
I. SUMMARY
This action authorizes the Executive Director to approve and bind a renewal of a ACE Municipal Advantage Public Entity Liability Policy on behalf of the Carson Reclamation Authority offered by Chubb Companies USA, underwritten by ACE American Insurance Company. As in previous years, the CRA's broker Marsh recommends placing such a policy instead of a standard Directors and Officers Liability (D&O) policy to ensure that the public officials are adequately covered for their D&O exposure - personal liability as well as Errors and Omissions exposure (E&O) and Employment Practices Liability (EPL) exposure.
This policy is a much broader D&O type coverage and tailored to CRA in its capacity as a quasi-governmental agency making development decisions on environmentally contaminated property and includes both E&O and EPL in one policy form.
This year's premium of $180,490.00 is flat from last year, which is good news given the CRA's annual operating budget increased over the past year from $5.2 million to $5.8 million. Prior to last year, which only saw an increase of 0.1%, the CRA saw significant increases in quoted premium for the same coverage, from slightly less than $80,000 in 2020 to $130,040 in 2021 to $180,351.00 in FY 2022/23, while maintaining the Self-Insured Retention (SIR) at $250,000. This was due to ongoing significant changes in the public officials' liability market and the D&O markets overall. (SIR is similar to a deductible in personal insurance.) Part of the increase was also attributed to the claim activity by the CRA on the current policy due to the ongoing C...
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