Resolution No. 2012-093RESOLUTION NO. 2012-93
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF
VERNON APPROVING AND AbTHORIZING THE PURCHASE OF
EXCESS WORKERS' COMPENSATIO14 INSURANCE FROM NEW
YORK MARINE AND GENERAL INSURANCE.COMPANY THROUGH
ARTHUR J. GALLAGHER & CO.
WHEREAS, the City's current Excess Workers' Compensation
Insurance Policy ("Workers Comp Policy") with New York marine and
General Insurance Company ("New York") expires on June 30, 2012; and
WHEREAS, the City used the services of Arthur J. Gallagher &
Co. Insurance Brokers of California, Inc. ("Arthur J. Gallagher") to
act as the City's broker to structure and obtain the appropriate
insurance coverages; and
WHEREAS, by memo dated May 23, 2012, the Risk Manager has
recommended that the Workers Comp Policy be purchased from New York
through Arthur J. Gallagher based on the quote from New York in the
amount of $122,901.00, exclusive of surplus lines taxes and fees; and
WHEREAS, the City desires to renew the Workers Comp Policy.
with New York to protect the City and its employees; and
WHEREAS, the City Council of the City of Vernon has
determined that, pursuant to the provisions of Section 2.27(b)(1) of
the Vernon City Code, it is in the public interest and necessity to
approve the purchase of the Workers Comp Policy through Arthur J.
Gallagher.
NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE
CITY OF VERNON AS FOLLOWS:
SECTION 1: The City Council of the City of Vernon hereby
finds and determines that the recitals contained hereinabove are true
and correct.
SECTION 2: The City Council of the City of Vernon hereby
approves the purchase of the Workers Comp Policy through Arthur J.
Gallagher.
SECTION 3: The City Council of the City of Vernon hereby
authorizes the City Administrator, or his designee, to execute any and
all documents necessary for the purpose of securing the Workers Comp
Policy on behalf of the City of Vernon and to take whatever actions
are deemed necessary or desirable for the purpose of implementing and
carrying out the purposes of this Resolution and the transactions
herein approved or authorized.
SECTION 4: The City Council of the City of Vernon hereby
approves the payment of the annual premium for the Workers Comp Policy
at the quoted cost of $122,901.00 plus surplus lines taxes and fees,
if applicable.
SECTION 5: The City Council of the City of Vernon hereby
directs the City Clerk, or the City Clerk's designee, to send a copy of
this Resolution to:
Arthur J.,Gallagher & Co.
Insurance Brokers of California, Inc.
Attn. Nasreen Kopecky, Account Manager
15 Enterprise, Suite 200
Aliso Viejo, CA 92656
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SECTION 6: The City Clerk of the City of Vernon shall
certify to the passage, approval and adoption of this resolution, and
the City Clerk of the City of Vernon shall cause this resolution and
the City Clerk's certification to be entered in the File of
Resolutions of the Council of this City.
APPROVED AND ADOPTED this 5 th day of June, 2012
Name: wildam J. Davis
Title: -MM76?/ Mayor Pro-Tem
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STATE OF CALIFORNIA
) ss
COUNTY OF LOS ANGELES
I, Willard G. Yamaguchi, City Clerk of the City of Vernon, do
hereby certify that the foregoing Resolution, being Resolution
No. 2012-93, was duly passed, approved and adopted by the City Council
of the City of Vernon at a regular meeting of the City Council duly
held on Tuesday, June 5, 2012, and thereafter was duly signed by the
Mayor or Mayor Pro-Tem of the City of Vernon.
Executed this day of June, 2 at Vernon, California.
-I- In
(SEAL)
City Clerk
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OFFICE OF THE CITY CLERK
4305 Santa Fe Avenue, Vernon, Califomia 90058
Telephone (323) 583-8811
June 7, 2012
Arthur J. Gallagher & Co.
Insurance Brokers of California, Inc.
ATTN: Nasreen Kopecky, Account Manager
15 Enterprise, Suite 200
Aliso Viejo, CA 92656
Re: Excess Workers' Compensation Insurance from New York Marine and General Insurance
Company
Dear Ms. Kopecky:
Transmitted herewith is a copy of Resolution No. 2012-93 that was approved by City Council on
June 5, 2012.
If you have any questions regarding this matter, please call Mr. Willard Yamaguchi at.(323) 583-
8811 ext. 175.
Ver truly yours,
e-
�W ARD
City Clerk
WGY:dj
Enclosure
c: Justin Arriola
Ana Barcia
Resolution No. 2012-93
E)Ccfusivefy industrid
RFECEIVED
MAY 2 4 2012
CITY CLERK'S OFFICE
DA: May 23, 2012
Staff Report
Risk Management
TO: Honorable Mayor Pro Tem and City Council
FR: Willard G. Yamaguchi, Risk Manager M
RE: Excess Workers' Compensation Insurance Renewal 2012-13
RECEIVED
MAY 2 3 2012
CITY ADMINISTRATION
In the case of workers' comp claims, the City of Vernon is self insured for the initial $1 million
of a claim ("SIR"), after which an excess workers' comp insurance policy is in place for the next
$50 million, per occurrence. The current carrier is New York Marine & General Insurance
Company ("NY Marine"). The cost of the current NY Marine policy is $111,835.00.
The purpose of such a large amount per occurrence is for example; both police and fire respond
to a catastrophic incident and a large number of personnel are injured during the event.
For fiscal year 2012-13, our insurance broker, Arthur J. Gallagher, was able to secure a quote
from NY Marine. Arch Specialty Insurance Company declined to quote due to heavy police &
fire exposures in an industrial city. Star/Meadowbrook declined to quote as Vernon was viewed
as too small of an account. Midwest declined to quote due to underwriting reasons, that is,
police and fire in California. ACE declined to quote for inability to compete with the current
pricing.
NY Marine submitted a bid in the amount of $122,901.00. While this represents an increase of
9.89% over the current fiscal year, the rate is lower than 4 years ago.
Fiscal impac
Adequate funds have been budgeted for this expenditure.
Recommendation
Risk Management recommends the renewal of the workers' comp insurance policy with New
York Marine & General Insurance Company at a cost of $122,90 1.00.