Resolution No. 09997 1 RESOLUTION NO. 9 9 9 7 ~ti~~
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A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF
3 VERNON APPROVING AND RATIFYING THE PURCHASE OF A
4 PUBLIC EMPLOYEE CRIME POLICY THROUGH ARTHUR J.
GALLAGHER & CO.
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6 WHEREAS, the City's current Public Employee Crime Policy
7 with Hartford Fire Insurance Company for dishonesty, forgery and fraud
8 expires on June 22, 2009 (the "Crime Policy"); and
9 WHEREAS, the .City employed the services of Arthur J.
10 Gallagher & Co. Insurance Brokers of California, Inc. ("Arthur J.
11 Gallagher") to act as the City's broker to structure and obtain the
12 appropriate insurance coverages for the period June 22, 2009 through
13 June 22, 2010; and
14 WHEREAS, by memo dated June 8, 2009, the Risk Manager has
15 recommended that the Crime Policy coverage be increased from $100,000
16 to $1 million in light of the type and size of some of the
17 transactions in the Finance Department, and the Crime Policy be
18 purchased through Arthur J. Gallagher based on the quote of American
19 International Group, Inc. ("AIG") in the sum of $4,784.00; and
20 WHEREAS, in order to meet the urgent need to purchase .the
21 Crime Policy to meet the expiration deadline and protect the City's
22 interests, the Risk Manager submitted the required application and
23 .payment, subject to ratification by the City Council; -and
24 WHEREAS, the City Council of the City of Vernon desires to
25 ratify the actions taken to obtain the necessary insurance coverage
26 for the Crime Policy before expiration; and
27 WHEREAS, the City Council of the City of Vernon has
28 determined that, pursuant to the provisions of subsection (a) of
1 Section 2.27 of the Vernon City Code, it is in the public interest and
2 necessity to approve the purchase of the Crime Policy through Arthur
3 J. Gallagher.
4 NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE
5 CITY OF VERNON AS FOLLOWS:
6 SECTION 1: The City Council of the City of Vernon hereby
7 finds and determines that the recitals contained hereinabove are true
8 and correct.
9 SECTION 2: The City Council of the City of Vernon hereby
10 approves and ratifies the actions of the Risk Manager in purchasing
11 the Crime Policy through Arthur J. Gallagher with AIG and authorizes
12 the City Administrator, or his designee, to execute any-and all
13 .documents necessary for the purpose of securing the Crime Policy and
14 to implement and carry out the purposes specified in this Resolution
15 on behalf of the City of Vernon.
16 SECTION 3: The City Council of the City of Vernon hereby
17 approves-and ratifies the payment of the annual premium for the Crime
18 Policy in accordance with the terms of the insurance purchase in an
19 estimated amount of $4,784.00 plus fees, if applicable.
20 SECTION 4: The City Council, of the City of Vernon hereby
21 directs the City Clerk, or her designee, to send a copy of this
22 Resolution to:
23 Arthur J. Gallagher & Co.
Insurance Brokers of California, Inc.
24 Attn. Nasreen Kopecky, Account Manager
25 15 Enterprise, Suite 200
Aliso Viejo, CA 92656
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1 SECTION 5: The City Clerk of the City of Vernon shall
2 certify to the passage of this resolution, and thereupon and
3 .thereafter the same shall be in full force and effect.
4 APPROVED AND ADOPTED this 29th day of June, 2009.
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~ Name: Hilario Gonzales
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Title: Mayor ~ Mali^r Prn~
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ATTEST:
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14 ANUELA GIRON, Ci y Clerk
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1 STATE OF CALIFORNIA )
ss
2 COUNTY OF LOS ANGELES )
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4 I, MANUELA GIRON, City Clerk of the City of Vernon, do hereby
5 certify that the foregoing Resolution, being Resolution No. 9997, was
6 duly adopted by the City Council of the City of Vernon at a regular
7 meeting of the City Council. duly held. on Monday, June 29, 2009, and
8 thereafter was duly signed by the Mayor or Mayor Pro-Tem of the City of
9 Vernon.
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MANUELA GIRO , City Clerk
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13 (SEAL)
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4305 Santa Fe Avenue, Vernon, California 90058
Telephone (323) 583-8811
June 29, 2009
Arthur J. Gallagher & Co.
Insurance Brokers of California, Inc.
ATTN: Nasreen Kopecky, Account Manager
15 Enterprise, Suite 200
Aliso Viejo, CA 92656
Re: Public employee Crime Policy
Dear Ms. Kopecky:
.Transmitted herewith. is a copy of Resolution No. 9997 that was
approved by City Council on June 29, 2009.
If you, have any questions regarding this matter, please call Ms.
Avigal Horrow at (323).583-88.11 ext. 315.
Very truly yours,
~'Y`-,_.
'l y i on
City Clerk
NG:dj
c: Willard Yamaguchi
Karina Rueda
Resolution No. 9997
ExcCusiveCy IndustriaC
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~u~ ~ i ~oo~ STAFF REPORT aPP~avECa' '09 ci~Y co~l~c~l_
CITY CLERK'S OFFICE Risk Management
~ITY CL RK D RIBl1 IC)I~d
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DA: June 8, 2009
TO: Honorable Ma or and Cit Council
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FR: Willard G. Yamaguchi, Risk Manager
RE: Employee Crime Policy 2009-10
Currently, the City has an Employee Crime policy with Hartford Insurance that includes
$100,000 coverage and a $25,000 deductible. The cost of the policy is $2,172. The policy
automatically renews on its own terms on June 22"d of each year.
Budget
Risk Management had budgeted $2,172 for this policy. However, after speaking with our broker
and describing the type and size of some electronic transactions, it was recommended that
coverage be increased.
Options
AIG Insurance provided 4 options for $500,000 and $1,000,000 coverage. The options presented
were $lmm coverage with a $25,000 deductible at a cost of $4,784; $lmm coverage with a
$5,000 deductible at a cost of $6,249; $500,000 coverage with a $25,000 deductible at a cost of
$2,420; and $500,000 coverage with a $5,000 deductible a cost of $3,803.
Recommendation
Since the difference in cost between the current policy and the AIG options presented is nominal,
coupled with the additional amount of coverage, Risk Management recommends that the City
accept the AIG proposal of $lmm coverage with a $25,000 deductible at a cost of $4,784.
This recommendation also includes increasing the amount budgeted for this item from $2,172 to
$4,784, a difference of $2,612.
cc: Dona10'Callghan
Avigal Horrow
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JuN 11 zoos Inter Office Memorandum
CITY CLERK'S OFFICE .Risk Management
DA: June 8, 2009
TO: Donal O'Callaghan, City Administrator
FR: Willard G. Yamaguchi,. Risk Manager
RE: Employee Crime Policy 2009-10
Attached is a Staff Report to the City Council recommending the purchase of an Employee
Crime policy for 2009-10. AIG has presented a very favorable premium/policy that increases the
current coverage from $100,000 to $1,000,000. The increase in coverage was recommended by
our broker due to the type and size of some transactions in the Finance Department. The cost of
the $1,000,000 policy with a $25,000 deductible is $4,784. The policy is effective from June 22,
2009 to June 22, 2010.
Please note that the current policy is with Hartford Insurance for $100,000 coverage with a
$25,000 deductible. The cost of the policy is $2,172.
13udg_et Amendment
Further, this will require an amendment to the Risk Management budget to increase this item by
$2,612.
Recommendation
It is recommended that the City Council approve of the Employee Crime Policy in the amount of
$4,784.
cc: Avigal Horrow
soot s n Nnc