HomeMy WebLinkAboutResolution - 2012-R0344 - Contract - TPSJSIF - Third Party Admin Liability Claim Services - 09_13_2012Resolution NO. 2012—R034.74
September 13, 2012
Item No. 5.21
RESOLUTION
BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF LUBBOCK:
THAT the Mayor of the City of Lubbock is hereby authorized and directed to
execute for and on behalf of the City of Lubbock, Contract No. 10629 for Third Party
Administrator Liability Claim Services, by and between the City of Lubbock and Texas
Political Subdivision Joint Self Insurance Fund of Dallas, Texas, and related documents.
Said Contract is attached hereto and incorporated in this resolution as if fully set forth
herein and shall be included in the minutes of the City Council.
Passed by the City Council on September 13, 2012
GLE OBE TSON, MAYOR
ATTEST-
--V
Rebe ca Garza, City Secretary
APPROVED AS TO CONTENT:
uincMhe�)Assistant City Manager
APPROVED AS TO FORM:
Cha Weaver, Assistant City Attorney
vw:ccdocs/RES.Contract-Tex Pol. Joint Self Ins. Fund
August 22, 2012
Resolution No. 2012-RO343 Contract: 10629
TEXAS POLITICAL SUBDIVISIONS
PROPERTY/CASUALTY JOINT SELF-INSURANCE FUND
INTERLOCAL AGREEMENT
CONTRACT NUMBER 12-FO633
(Cash Flow Plan For Political Subdivisions)
This Interlocal Agreement entered into by and between the Texas Political Subdivisions
Property/Casualty Joint Self -Insurance Fund (hereinafter referred to as "Fund") and the undersigned
political subdivision of the State of Texas (hereinafter referred to as "Fund Member") is for the
purpose of providing liability, property and automobile physical damage self-insurance funding;
insurance; reinsurance; claims administration; loss control services; and other risk management
services as needed for the "Fund Members" and their employees.
WITNESSETH:
The undersigned Fund Member, in accordance with the Interlocal Cooperation Act, Chapter
791 of the Texas Government Code and the interpretation thereof by the Attorney General of the
State of Texas (Opinion #MW-347, May 29, 1981), and in consideration of other political
subdivisions executing similar Interlocal Agreements, does hereby agree to become a member of
the Fund. The conditions of membership agreed upon by and between the parties are as follows:
l . Definition of terms used in this Interlocal Agreement.
a. Allocated Loss Expense -- the costs incurred in processing claims, including but
not limited to court costs, expenses for investigation and adjustment of claims, legal
expenses, cost containment services (such as PPO discounts, rehabilitation services,
medical management services), costs in protection and pursuit of
subrogation/recovery rights, and similar expenses chargeable to a particular claim
(excluding ordinary overhead expenses of the Fund and/or its designee such as
salaries and other fixed expenses).
b. Board -- the Board of Trustees of the Texas Political Subdivisions
Property/Casualty Joint Self -Insurance Fund.
C. Loss -- the sums actually paid or payable by the Fund in the settlement or
satisfaction of any claim or suit for which a Fund Member is liable either by
adjudication or settlement made with the written consent of the Fund.
2. At the Fund's discretion, each Fund Member may adopt any or all of (1) the TPS Joint Self -
Insurance Fund General Liability Coverage, (2) the TPS Joint Self -Insurance Fund
Automobile Liability and Physical Damage Coverage, or (3) the TPS Joint Self -Insurance
Fund Property Coverage self-insurance plans. Whichever Self -Insurance Plan(s) the Fund
Member accepts, the Fund Member agrees to adopt and accept the coverages, provisions,
terms, conditions, exclusions and limitations of the applicable Self -Insurance Plan(s)
Coverage Document(s). The limits of self-insurance, optimal coverages and deductibles
selected by the Fund Member will be shown on the Declarations of each coverage
document.
3. If the Fund Member adopts the TPS Joint Self -Insurance Fund General Liability Coverage,
or the TPS Joint Self -Insurance Fund Automobile Liability and Physical Damage Coverage
self-insurance plan(s) which cover liability exposures, it is understood that by participating
in this Self -Insurance pool, the Fund Member does not intend to waive any of the
immunities that its officers or employees now possess. The Fund Member recognizes the
Texas Tort Claims Act and its limitations to certain governmental functions as well as its
monetary limitations, and that by executing this Agreement does not agree to expand those
limitations.
4. This Interlocal Agreement shall commence at 12:01 a.m. on the date shown as
"effective date" on the signatory page of this Agreement, and shall terminate at 12:01
a.m. on October 1, 2013. This Agreement may be terminated by (a) mutual consent or
by (b) either party giving sixty (60) days prior written notice of termination to the
other party or (c) as otherwise specified in this Interlocal Agreement or the Bylaws of
the Fund.
S. The Fund member agrees to execute necessary authorization form(s) permitting the Fund
and/or its designee to obtain from other parties experience rating information for the Fund
Member.
6. The newly enrolling Fund Member who has not previously been a member of this Fund or
the Fund Member who has not previously operated under this Cash Flow plan agrees to pay
the Fund, on or before the inception date of this Interlocal Agreement, an initial payment of
one (1) month's estimated Claims Administration Fee plus 1/12 of the estimated annual
Contractor Charges such as Administrative Services Fees, Loss Control Services, or other
charges as set forth in Exhibit A attached hereto. On or before the commencement of the
third month after the inception date of this Interlocal Agreement, the Fund Member agrees
to pay an amount equal to the actual Claims Administration Fee, the total Field Service Fee
(if any) of the first month of membership plus any other associated Claims Administration
Fee plus 1/12th of the estimated annual Contractor Charges. On or before the
commencement of the fourth month of this Interlocal Agreement, a similar payment based
upon the actual Claims Administration Fee of the second month shall be paid to the Fund,
with subsequent monthly payments to be paid each and every month thereafter, based on the
actual Claims Administration Fee and applicable charges. The actual Claims
Administration Fee of the Fund Member are those fees paid by the Fund on behalf of the
Fund Member in the month which is two months prior to the billing month. However, the
Fund and the Fund Member may agree to a different payment plan.
7. The Fund Member who was a member of this Fund immediately prior to the inception date
of this Interlocal Agreement and has operated under this Cash Flow plan agrees to pay the
Fund for those services described in this Agreement and the charges listed in Exhibit A
attached hereto. Each month's billing will include 1/12th of the estimated annual Contractor
Charges as described in Paragraph 6 above. Also included in this billing will be an amount
equal to the actual Claims Administration Fee of the Fund Member plus any other
associated Claims Administration Fee as set forth in Exhibit A.
8. The Fund will invoice the Fund Member monthly for these amounts due and the payment
by the Fund Member is due in the office of the Fund and/or its designee on or before the
beginning of the month. In the event the Fund Member fails or refuses to make the
payments of charges as herein provided, the Fund reserves the right to terminate such Fund
Member by giving ten (10) days written notice and to collect any and all outstanding
charges or other required payments which were incurred prior to the date of the
Interlocal Agreement termination.
9. It is further agreed that the Fund Member will create on or before the inception date of the
Interlocal Agreement a loss deposit with the Fund equal to a minimum of two months
estimated paid losses. This deposit will be adjusted periodically to accurately reflect
realistic monthly loss payments and/or timely invoice payments.
10. After termination of this Agreement, the Fund will continue to handle claims with an
accident date occurring during the term of this Agreement until such claims are ultimately
and finally disposed of or closed. After termination of this Agreement, the Fund Member
will pay the Fund each and every month, until all claims handled by the Fund are disposed
of, the monthly claims administration charge calculated as described herein, and the
monthly reimbursement of actual claims losses paid on behalf of the Fund Member as
determined herein. The Fund Member also agrees to maintain with the Fund the loss
deposit as determined herein. Upon expiration of this contract, the Fund or its designated
agent will continue to adjust claims which occurred or are made during the Agreement
Period.
11. In the event the Fund Member fails or refuses to make any required payment on a timely
basis as described herein, the Fund reserves the right, by giving ten (10) days written notice,
to cease all payments on behalf of the Fund Member and return any files on active
property/casualty claims to the Fund Member. In such event, the Fund Member agrees to
assume all liabilities and claims handling responsibilities on those claims from the date of
notification forward. The Fund Member agrees to pay the Fund all charges and other
required payments which were incurred prior to the date of notification.
12. After termination of this Agreement, the Fund is not obligated to provide any of the services
as described herein except for claims administration services as described in Paragraph 12
above.
13. Loss Control Services will be supplied by the Fund and/or its designee to Fund Members to
assist them in following a plan of loss control that may result in reduced losses. The
undersigned Fund Member agrees that it will cooperate in instituting any and all reasonable
loss control recommendations for the purpose of eliminating or minimizing hazards that
would contribute to losses. The loss control services provided are, however, optional for
the Fund Member. If the Fund Member elects this service, its election shall be indicated on
Exhibit A attached hereto.
14. Pursuant to the terms and conditions of the applicable Self -Insurance Plan(s) Coverage
Documents, the Fund and/or its designee, agrees to administer any and all claims after
notice of claim has been given and to provide a defense where appropriate. The Fund
Member hereby appoints the Fund and/or its designee as its agent to act in all matters
pertaining to processing and handling of all claims and shall cooperate fully in supplying
any information needed or helpful in the administration of those claims. The Fund and/or
its designee shall carry on all negotiations with any third parties or their attorneys and
negotiate within authority granted by the Fund. The Fund and/or its designee shall retain
and supervise legal counsel on behalf of and at the expense of the Fund as necessary for the
prosecution and defense of any litigation.
15. At the option of the Fund and/or its designee, a Fund Member may be allowed to choose the
legal counsel it deems most appropriate for the handling of any individual claim. However,
all decisions on individual claims shall be made by the Fund and/or its designee, which
includes the decision to appeal or not to appeal a final adjudication at the trial court level.
However, any Fund Member shall have the right to consult with the Fund and/or its
designee on any claim and have the right to appeal any decision made by the Fund and/or its
designee to the Board. Any suit brought or defended by the Fund shall be brought or
defended only in the name of the Fund Member and/or its officers or employees.
16. The Fund Member will be solely responsible for future benefits payable and for funding its
net reserve. The Fund Member agrees to hold the Fund harmless from any and all claims
(including attorney fees) that may be asserted against the Fund for the non-payment of any
claim due to the failure of the Fund Member to maintain adequate reserves for the payment
of claims.
17. The Fund agrees that all Fund transactions will be audited annually by a certified public
accounting firm.
18. The Fund Member agrees that it will appoint a coordinator of department head rank or
higher, and that the Fund and/or its designee shall not be required to contact any other
individual except this person. Any notice to or any agreements with the Coordinator shall
be binding upon the Fund Member. The Fund Member may change the Coordinator by
giving written notice to the Fund.
19. The Fund Member acknowledges that it has received a copy of the Bylaws of the Fund, and
it agrees to abide by these Bylaws and any amendments thereto and any and all policies and
procedures of the Fund.
20. The Fund Member shall have the right to appeal any decision or recommendation of the
Fund and/or its designee to the Board whose determination will be final. Any appeal shall
be made in writing to the Fund Secretary within 60 days of decision or recommendation of
the Fund and/or its designee.
21. Any party hereto paying for the performance of governmental functions or services shall
make payments from current revenues available to the paying party.
22. The Fund Member shall take no action to release, discharge or impair its right to seek
recovery of any amounts paid under this Agreement from any person or entity legally
responsible for the bodily injury, sickness or disease, or death for which such payment is
made. Nor may the Fund Member assign such rights without the express, written approval
of the Fund.
23. This Interlocal Agreement, together with all the Amendments, Supplements and other
attachments hereto, including but not limited to Exhibit "A", Amendments 1, 2 and 3,
constitutes the entire agreement between the parties and supersedes all previous Interlocal
Agreements, promises, representations, understandings and negotiations, whether written or
oral, between the parties with respect to the subject matter hereof.
24. If any portion of this Interlocal Agreement shall be declared illegal or held unenforceable
for any reason, the remaining portions shall continue in full force and effect.
25. It is the intent of the Parties that the Fund and/or its designee and the Fund Member each
shall bear responsibility for any of its own negligence or its own error or omission,
including, but not limited to, claims alleging violations of the Texas Insurance Code, the
Deceptive Trade Practices and Consumer Protection Act, and the common law duty of good
faith.
26. The Fund and/or its designee shall not be held accountable for any increased cost or expense
to the Fund Member involving payments of claims, under any contention by the Fund
Member that a claim service, risk management service, loss control service, or
administrative service could have been handled differently.
27. The Fund Member agrees to timely provide all necessary information to the Fund and/or its
designee and to timely execute all necessary documents as may be needed or required for
the administration of the Fund.
28. Periodically each Fund Member will be provided a computer printout containing a
statement of claims cumulative for said Fund Member by Effective Date of that Fund
Member.
City of Lubbock
Fund Member Name
Date
ATTEST:
TO BE COMPLETED BY FUND MEMBER
Sig t of A;fRo7ized Official
Glen C. Robertson
Type Name
Mayor
Title
Rebec Garza, City Secretary
THE PROPERTY/CASUALTY COORDINATOR FOR THE FUND MEMBER IS:
Coordinator Name & Title: Ms. Leisa Hutcheson
Mailing Address: 1625 1 P Street, Lubbock, TX 79457
Street Address: (same as above
Telephone Number: (806) 775-2277
Fax Number: (806) 775-2164
TO BE COMPLETED BY TPS FUND OFFICE
October I, 2012
Effective Date of Agreement
Signature of Fund Secretary
APPROVED AS TO CONTENT
uincy W it , Assistant City Manager
12-FO633
Contract Number
August 21, 2012
Date
APP D A TO FORM
Chad Weaver, Assistant City Attorney
EXHIBIT A
Section E: Fees & Expenses
Liability Claims Administration
TPS proposes to provide claims administration services for the City of Lubbock claims
management program per the following schedule. Stated fees do not include loss or
allocated loss adjustment expense (ALAE) payments. A sample listing of ALAE items is
included at the end of this section.
Life of Contract Handling*
General Liability
Property Damage <$25,000
Property Damage >$25,000
Bodily Injury
Auto Liability
Property Damage
Bodily Injury
Med Pay/PIP
Collision/Comprehensive
Property
<$25,000
>$25,000
Business Interruption
Extra Expense
Other Coverages
E&O
Professional Liability
Garage Keeper
Public Official Liability
Law Enforcement Liability
Crime
Tail File (take-over) Handling
AL/physical Damage
BI (GL or AL)
PD (GL or AL)
Property
Other: Professional Liability
$300 per claim
$350 per claim
$375 per claim
$245 per claim
$415 per claim
$335 per claim
$175 per claim
$265 per claim
$330 per claim
$300 per claim
$285 per claim
$665 per claim
$665 per claim
$570 per claim
$665 per claim
$665 per claim
$570 per claim
$125 per claim
$175 per claim
$235 per claim
$200 per claim
$510 per claim
TPS
48
Additional Service Fees
Administration Fee
$2, 500
Information Services
Claims System Viewing I.D.'s, Training, On-line
Access $Included
Total conversion of prior claims data $3,900
EC
49
Allocated Loss Adjustment Expenses
The following items are examples of allocated loss adjustment expenses, and are in
addition to the stated per -claim service fees. They will be charged to the file "as vended".
❑ Independent medical examinations and medical records
❑ Medical cost containment services including hospital bill audit, provider bill audit,
PPO utilization, telephonic and field nurse case management services
❑ Court costs and fees for service of process, outside attorney fees, court reporter and
stenographer services and transcripts
❑ Witness fees and expenses
❑ Bond premiums
❑ Printing costs related to trials and appeals
❑ Testimony, opinions, appraisals, reports, surveys and analysis of professionals
and/or experts
❑ Trial and hearing attendance fees
❑ Depositions, video statements
❑ Private investigator fees
❑ Vocational rehabilitation fees
❑ Crisis management vendor fees
❑ Alternate dispute resolution fees
❑ Other vended services including, but not limited to field investigation
❑ Loss Control Services $115 per hour
Invoicing
Invoicing for claim service fees will be done monthly on an "as incurred" basis for per
claim fees. The administration fee will be billed in full during the first months billing. All
ALAE including any managed care fees will be paid though the file.
Definitions of Injury categories
Incident Only Claim: A claim reported for record only purposes. No contacts, bill
payments, acknowledgements, or any other claim handling is anticipated or required.
Indemnity Claim: Any claim which requires any one of the following: medical payments
in excess of $5000; subrogation (or other offset) investigation or recovery;
compensability investigation and/or dispute; fraud investigation; extent of injury disputes;
payment of indemnity benefits of any kind; or lost time from work beyond the waiting
period.
Medical Only Claim: A claim that does not meet the definition of either an Incident Only
or Indemnity claim.
TPS
50
Page 1 of 2
AMENDMENT NO 1 -- TO THE INTERLOCAL AGREEMENT
TEXAS POLITICAL SUBDIVISIONS PROPERTY CASUALTY
JOINT SELF-INSURANCE FUND
CASH FLOW PLAN
It is hereby agreed the Interlocal is amended to include the following wording:
The City shall not consider this service contract claim proposal complete unless the
service company's planned contract specific to the City of Lubbock, Texas is attached as
part of the proposal with proposed terms, conditions and pricing.
The service company warrants that all adjusters assigned to work on the City account
shall be properly licensed to do business in the state of Texas.
3 The City will retain the right of approval regarding the assignment of personnel to
service their account.
4 The City prefers an annual contract renewable for two (2) additional one year terms.
However, the service company must agree that services may be terminated without cause
upon thirty (30) days written notice. In the event of termination, the service company
may be required to provide the necessary best effort to transfer records and cumulative
loss data to a superseding service company for the City.
5 The service company shall be responsible and held accountable and responsible for any
all erroneous payments and overpayments caused by the service company, its employees
and subcontractors.
6 The service company shall notify the City of any imminent or pending court actions at
the earliest opportunity.
The service company shall be responsible and held accountable for any and all payments
to third -parties and legal expenses resulting from errors and omissions of the service
company, its employees and subcontractors related to the claim handling process for
Automobile, General and Other liability claims.
8 The service company shall defend, hold harmless and indemnify the City for any acts,
error or omissions of their firm, employees, associates, or subcontractors arising out of
the services provided. Insurance protection carried by the servicing company for
services rendered shall be primary to policies that may be carried by the City.
9 Non -Arbitration - The City reserves the right to exercise any right or remedy available to
it by law, contract, equity, or otherwise, including without limitation, the right to seek
any and all forms of relief in a court of competent jurisdiction. Further, the City shall
not be subject to any arbitration process prior to exercising its unrestricted right to seek
judicial remedy. The remedies set forth herein are cumulative and not exclusive, and may
be exercised concurrently. To the extent of any conflict between this provision and
another provision in , or related to, this document, this provision shall control.
08/21 / 12 PCCF
Page 2 of 2
10 Any and all materials/documents gathered or produced are the sole property of the City
and shall be retained or destroyed in accordance with the laws of the State of Texas and
approval of the City Risk Management Coordinator.
11 Allocated expenses DO NOT include office operating expenses, telephones, and
expenses for salaried employees of the service company or the subcontractor.
IN WITNESS WHEREOF, this Agreement is executed as of the Effective Date.
CITY OF LUBBOCK, TX
Glen ertson, ay -or
ATTEST
Rebecc Garza, City Secretary
APPROVED AS TO CONTENT:
uincy White, sistant City Manager
APPROVE" AS TO FORM:
Chad Weaver, Assistant City Attorney
City of Lubbock
Name of Member
12-FO633
CONTRACTOR
Signature
Mr. Richard Petree
Print Name
Secretary
Title
October 1, 2012
Effective Date:
0& 21 12 PCCF
Page 1 of 16
AMENDMENT NO 2 -- TO THE INTERLOCAL AGREEMENT
TEXAS POLITICAL SUBDIVISIONS PROPERTY CASUALTY
JOINT SELF-INSURANCE FUND
CASH FLOW PLAN
It is hereby agreed the Interlocal is amended to include the following wording:
Resolution No. 2005-80196
May 12, 2005
Item No. 30
RESOLUTION
WHEREAS, by Resolution dated December 11, 1986 (Resolution No. 2481), the
City of Lubbock established the City of Lubbock Self Insurance Fund;
WHEREAS, by Resolution dated October 22, 1987 (Resolution No. 2672), the
City of Lubbock repealed Section 5 of Resolution No. 2481, and in its stead adopted a
new statement of coverage for the City of Lubbock Liability Self Insurance Program;
WHEREAS, by Resolution dated December 13, 2001 (Resolution No. 2001-
R0517), the City of Lubbock further amended Resolution No. 2481 in certain respects not
affected herein;
WHEREAS, the City Council of the City of Lubbock now desires to amend
Resolution No. 2672, regarding the Statement of Coverage Liability Self Insurance
Program, attached to such Resolution as Exhibit "A'; NOW THEREFORE:
BE IT RESOLED BY THE CITY COUNCIL OF THE CITY OF LUBBOM
Section I. THAT Section 2 of Resolution No. 2672 is hereby deleted in its
entirety, and replaced with the following:
THAT the City of Lubbock Statement of Self Insurance Risk Program Coverage
attached to this Resolution as Exhibit "A" and made a part hereof for all purposes
is hereby adopted as the coverage to be afforded under the City of Lubbock's Self
Insurance Fund.
Section 2. THAT Exhibit "A' to Resolution No. 2672 is hereby deleted in its
entirety and replaced with Exhibit "A", attached hereto.
Section 3. Except as amended herein, Resolution No. 2672 shall remain in full
force and effect as originally provided.
Passed by the City Council this t ?jrh_ day of May 2005.
ARG- c UGAL, MAYOR
ATTEST:
Reb cca Garza, City Secretary
08/21 / 12 PCCF
Page 2 of 16
Af PROVED AS TO CONTENT:
:�� `�
Leisa Hutcheson, Risk Manager
APPROVED AS TO FORM:
JeWartsqll, Assistant City Attorney
ml/ccdocsSclf Insurancc Fund.res
May 2, 2005
08/21 / 12 PCCF
Page 3 of 16
Resolution No. 2005—RO196
May 12, 2005
Item No. 30
CITY OF LUBBOCK
Statement of Self Insurance Risk Program
Coverage
I. DEFINITIONS
The words and phrases in italics in this policy have special meanings:
A. Actual Cash Value — Replacement cost less depreciation.
H. Contractual Disputes — A dispute to a legally enforceable promise
made by agreement between the City and another vendor.
Contractual Disputes shall not include salaries, overhead or
sufficiently budgeted items for the fulfillment of the contract.
C. Covered Party — A person or organization set forth in Section H.
D. City —The City Of Lubbock,
E. Defense Expense — Fees and expenses related to the adjustment,
investigation, defense or litigation of a claim, including attorney's fees,
filing fees, court costs, arbitration/mediation costs, expert and
consultation fees, and travel. Defense Expense shall not include the
salaries, overhead or normally budgeted items such as training of
employees of any Covered Party.
F. First Party Claims — Damages to property (not including City owned
fleet that has a value of less than $50,000) owned/leased by the City
and within the City's self -insured retention. Such damages must be
sudden and accidental in nature and not caused by failure to properly
maintain. First Party Claims costs shall not include the salaries,
overhead or normally budgeted items of employees of any Covered
Party.
G. Program — The City of Lubbock Self Insurance Risk Program
H. Self -Insured Retention — Any deductible associated with insurance for
property and casualty coverages purchased by the City.
I. Subrogation — The recovery of money for loss to City assets, by the
Risk Management Department for all other departments, as a result
of another's legal liability.
L Subrogation Expense — Fees and expenses related to the investigation
and pursuit of recovery, including litigation expenses. Litigation
expenses include attorney's fees, court costs, arbitration/mediation
costs, expert and consultation fees and travel, but shall not include
salaries, overhead or normally budgeted items of any Covered Party.
08/21/12 PCCF
Page 4of16
X Workers' Compensation — Coverage provided by the City to secure the
payment of compensation in accordance with all provisions of Title 5
of the Texas Labor Code. Coverage may be obtained through
conventional insurance, use of a municipal pool or self-insurance, at
the direction of the Council.
II. WHO IS COVERED
Each of the following is a covered party under the program:
A. The City.
B. While acting in the course and scope of their duties, current and
previous:
a. Elected or appointed officers and officials of the City.
b. Board or commission members, either Officer of the City or
Advisory, appointed by the City where no other commercial errors
and omissions or directors and officers coverage exists.
c. Employees or authorized volunteers of the City.
C. Any person in B above when serving on boards, agencies or commissions
of any ldnd at the direction of the City or with the consent of the City.
D. Any entity the City is obligated by virtue of a written contract to provide
any property and/or casualty coverage, but only with respect to
operations performed by or on behalf of the City or facilities owned or
used by the City.
M. 'V"irHAT IS COVERED
The program will pay:
A. Coverage provided by the City to secure the payment of property and
casualty coverages. Coverage may be obtained through conventional
insurance, use of a municipal pool or self-insurance. Premiums for
commercial or municipal pool excess or primary insurance for property
and casualty coverages as necessary to protect the City and subject to
approval by the City Manager or designee if the premium amount is less
than $25,000 or Council if the premium amount exceeds $25,000.
B. Self -Insured Retentions or self-insurance, at the direction of the Council,
or at the direction of a commercial insurance carrier, if required by
written contract, on claims in accordance with the coverage document of
excess liability or at the direction of the court, to include judgment and
interest.
08/21/12 PCCF
Page 5 of 16
C. Self -Insured Retentions or self-insurance, at the direction of the Council,
on Automobile Medical Payments and Uninsured/Underinsured Bodily
injury on vehicles owned/leased by the City.
D. Self -Insured Retentions or self-insurance, at the direction of the Council,
on first party claims in accordance with the type and scale below:
PR OPER T'Y DED UCT IBL ES
a. Minimum $10,000 per occurrence
b. Claims over $25,000 would have an additional 10% of additional
total cost
c. Maximum $50,000 per occurrence
Deductibles outlined above may be reduced or increased upon the
approval of the City Manager if such deductible would create an
extraordinary financial hardship to the departmental budget.
E. AU other sums not covered by insurance, that the covered party shall
become legally obligated to pay up to $1,000,000 per occurrence. Such
obligations may include contractual disputes or other issues not covered
by conventional insurance. The limit under this section is intended as
seed money only and is designed to protect the program from being totally
depleted for those items that are of such a nature as to require an
increase in taxes or issuance of bonds. This would include contractual
disputes or other issues not covered by conventional insurance. In all
such instances that the department budgeted sufficient funds on any
contractual dispute, the funds will be paid from the department's budget.
F. Workers' Compensation liability under Title 5 of the Texas Labor Code,
if Council has elected to self -insure workers' compensation during any
given budget year.
G. On matters covered by A, B, C, D, E and F above, defense expense
incurred by the City or incurred with the consent of the City.
H. On matters covered by A, B, C, D, E and F above, loss adjustment
expenses.
I. Defense Expenses associated with Civil Service arbitration or other legal
actions.
J. Defense Expenses associated with any claim.
K Subrogation Expenses associated with efforts to recover money for loss to
City assets; however, any subrogation expenses paid will reduce the
amount of recovery to the affected Fund.
L. The actual cash value of damage to an employee's automobile, if such
damage arises from the authorized use of the automobile on City business
and only if there is no other collectable insurance. If there is other
collectible insurance, the City shall only be liable for that portion that is
not otherwise covered.
08/21 12 PCCF
Page 6 of 16
M. Comprehensive safety measures, including equipment, repair of facilities
and training for items that are an immediate risk to the general public or
the City's work force that are not normally budgeted operating
expenditures.
N. Operational costs of the Risk Management Department, and assuciated
departments, as approved annually in the budget.
IV. WHAT IS HOT COVERED
The program does not apply to:
A. Liability under disability benefits, unemployment compensation, health
benefits or similar laws.
B. Damages covered by insurance or other self-insurance programs applying
to a covered party.
C. City police officers while employed by others and not performing City law
enforcement functions.
D. A covered parry's damages or defense expense arising from a claim
origioaUy asserted by a covered party against another covered party.
E. Penalties, fines or associated fees relating to permitting or regulatory
findings.
F. Defense expenses associated with the collection of past due tax liens or
uncoUectible receivables (excluding subrogation accounts).
G. A covered parry's salaries, overhead or normally budgeted item.
08/21/12 PCCF
Page 7 of 16
Resolution No. 2001-RO51
December 13, 2001
Item No. 31
RESOLUTION
WHEREAS, the City of Lubbock has heretofore on December 10, 1986, enacted
Resolution No. 2481 establishing the City of Lubbock Self Insurance Fund; and
WHEREAS, the City Council of the City of Lubbock deems it to be in the best
interests of the citizens of the City of Lubbock to amend such Resolution with regard to
the procedures for approval of disbursements from said fund in amounts of more than
$50,000 and certain other administrative matters; NOW THEREFORE:
BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF LUBBOCK:
SECTION 1. THAT subparagraph 1 of Section 7 of Resolution No. 2481 is
hereby amended to read as follows:
1. To keep the City Manager fully informed as to all aspects of the self-
insurance fund and the City Manager also shall keep the City Council fully
informed as to all aspects of the self-insurance fund. The claims settlement
procedures contained in this Section shall have no application to workers
compensation claims.
SECTION 2. THAT subparagraph 3(b) of Section 7 of Resolution No. 2481 is
hereby amended to read as follows:
(b) In cases where the claim is more than ten thousand dollars but less than
twenty thousand dollars, the administrator shall secure the approval of the
Assistant City Manager over Finance.
SECTION 3. THAT subparagraph 3(c) of Section 7 of Resolution No. 2481 is
hereby amended to read as follows:
(c) In cases where the claim is for twenty thousand dollars but less than fifty
thousand dollars, the administrator shall secure the approval of the City
Manager.
SECTION 4. THAT a new subparagraph 3(d) is hereby added to Section 7 of
Resolution No. 2481 which shall read as follows:
(d) In all claims where the City Manager is alleged to be primarily a
responsible party under the claim, the City Council's approval or rejection
shall be secured in an open meeting of the City Council as required by the
Texas Open Meetings Law.
08/21 / 12 PCCF
Page 8 of 16
SECTION 5. THAT a new subparagraph 3(e) is hereby added to Section 7 of
Resolution No. 2481 which shall read as follows:
(e) In cases where the claim is for fifty thousand dollars or more, the City
Manager shall submit the claim to the City Council for approval or
rejection in an open meeting of the City Council as stated above.
Passed by the City Council this 13tb day of December , 2001
1P A
WINDY SITTO , MAYOR
ATTEST:
QA'11� on\�
Rebecca Garza, City Secretary
APPROVED AS TO CONTENT:
2. �'
Bob Cass, City Manager
APPROVED AS TO FORM:
13�ld G. Vandiver, First Assistant
City Attorney
DDms/5d11nLkmead.ms
November 28, 2001
08/21/12 PCCF
First Heading
December 3, 2001
Item No. 21
Page 9 of 16
Second Reading
December 13, 2001
Item No. 17
ORDINANCE NO. 2001-00095
AN ORDINANCE AMENDING SECTION 2-37 OF THE CITY OF LUBBOCK CODE
OF ORDINANCES WITH REGARD TO APPROVAL AND PAYMENT OF CLAIMS
AGAINST THE CITY; PROVIDING A SAVINGS CLAUSE; AND PROVIDING FOR
PUBLICATION.
WHEREAS, the City Council finds that it would be in the best interest of the
citizens of the City of Lubbock to amend Section 2-37 of the Code of Ordinances of the
City of Lubbock with regard to the procedures for approval of claims against the City of
Lubbock; NOW THEREFORE:
BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF LUBBOCK:
SECTION 1. THAT Section 2-37 of the Code of Ordinances, City of Lubbock,
Texas, is hereby amended to read as follows:
Sec. 2-37. Approval of claims.
The City Manager and/or the administrator of the City of Lubbock Self
Insurance Fund shall make disbursements from the City of Lubbock Self
Insurance Fund in settlement of claims (except workers compensation claims) in
the following manner:
1) In cases where the self insurance claim is ten thousand dollars or less,
the administrator of the City of Lubbock Self Insurance Fund shall have full
authority.
2) In cases where the self insurance claim is more than ten thousand
dollars but less than twenty thousand dollars, the administrator shall secure the
approval of the Assistant City Manager over finance.
3) In cases where the self insurance claim is more than twenty thousand
dollars but less than fifty thousand dollars, the administrator shall secure the
approval of the City Manager.
4) In all self insurance claims where the City Manager is alleged to be
primarily a responsible party under the claim, the City Council's approval or
rejection shall be secured in an open meeting of the City Council as required by
the Texas Open Meetings Law.
5) In cases where the self insurance claim is fifty thousand dollars or
more, the City Manager shall submit the claim to the City Council for approval or
rejection in an open meeting of the City Council as required by the Texas Open
Meetings Law.
0&21 12 PCCF
Page 10 of 16
SECTION 2. THAT should any paragraph, sentence, clause, phrase or word of
this Ordinance be declared unconstitutional or invalid for any reason, the remainder of
this Ordinance shall not be affected thereby.
SECTION 3. THAT the City Secretary is hereby authorized to cause publication
of the descriptive caption of this Ordinance as an alternative method provided by law.
AND IT IS SO ORDERED.
Passed by the City Council on first reading this 3rd day of December , 2001.
Passed by the City Council on second reading this 13th day of December , 2001.
ATTEST:
Rebecca Garza, City Secretary
APPROVED AS TO CONTENT:
. & Q(6
Bob Cass, City Manager
AP OVED AS TO FORM:
Z 4-rj�- 21.
Wald G. Van 'ver, First Assistant
City Attorney
DDOnWlaim Approval.ord.doc
November 21, 2D01
08/21/12 PCCr
JCR:da
RESOLUTION
Page 11 of 16
KesoiuTion a[b!e
October 22, 1987
Agenda Item #29
A RESOLUTION AMENDING RESOLUTION NO. 2481 BY REPEALING SECTION 5
THEREOF WHICH ADOPTED SELF INSURANCE COVERAGE FOR THE CITY OF LUBBOCK AS
PROVIDED BY THE TEXAS MUNICIPAL LEAGUE JOINT SELF INSURANCE FUND AND IN ITS
STEAD ADOPTING A NEW STATEMENT OF COVERAGE FOR THE CITY OF LUBBOCK
LIABILITY SELF INSURANCE PROGRAM.
WHEREAS, the City of Lubbock did heretofore by Resolution No. 2481
create the City of Lubbock's Self Insurance Fund; and
WHEREAS, in said Resolution No. 2481 the City of Lubbock did adopt as
its standard coverage a coverage heretofore provided by the Texas Municipal
League Joint Self Insurance Fund; and
WHEREAS, the City of Lubbock deems it to be in the best interest of
the City of Lubbock to repeal the coverage adopted under Resolution No.
2481 and in its stead to substitute a new statement of coverage for the
City of Lubbock Self Insurance Fund; NOW THEREFORE:
BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF LUBBOCK:
SECTION 1. THAT Section 5 of Resolution No. 2481 adopting the Texas
Municipal League Joint Self Insurance Fund as the coverage document for the
Lubbock Self Insurance Fund is hereby in all things repealed.
SECTION 2. THAT the City of Lubbock Statement of Coverage Liability
Self Insurance Program attached to this Resolution as Exhibit A and made a
part hereof for all purposes is hereby adopted as the coverage to be
afforded under the City of Lubbock Self Insurance Fund.
SECTION 3. Save and Except as herein repealed or amended, Resolution
No. 2481 shall remain in full force and effect.
Passed by the City Council this 22nd day of
Ranett oyd, City Secretary
APPROVED AS TO CONTENT:
I Robert Massengale( Assistant
City Manager for Financial Services
APPCR O�VED AS TO
4 `J"
C. Ross, Jr., City Attorney
October , 1987,
B.C. McMINN, MAYOR
08/21 / 12 PCCF
Page 12 of 16
Res. #2672
1Q-22-g7
'9/25/87
CITY OF LUBBOCK
STATEMENT OF COVERAGE
LIABILITY SELF-INSURANCE PROGRAM
1. WHAT I$ COV$RED
The program will pay:
A. All sums the covered party shall become legally obligated to
pay as damages.
B. On matters covered by A above, defense expense incurred by
the City or incurred with the consent of the City.
C. The actual cash value of damage to an employee's automobile,
if such damage arises from the authorized use of the automo-
bile on City business.
[I. WHAT
I$ NOT COVERED
The program does not apply to:
A.
Liability under workers' compensation, disability benefits, un-
employment compensation or similar laws.
B.
Damage to property owned by the City.
C.
Damages covered by insurance or other self-insurance pro-
grams applying to a covered party.
D.
City police officers while employed by others and not per-
forming City law enforcement functions.
E.
A covered party's damages or defense expense arising from a
claim originally asserted by that covered party against another
covered party.
111. WHO IS COVERED
Each of the following is a covered party under the program:
A. The City.
08/21 / 12 PCCF
Page 13 of 16
B. While acting in the scope of their duties, current and previous:
1. Elected or appointed officers and officials of the City.
2. Board or commission members appointed by the City.
3. Employees or authorized volunteers of the City.
C. Any person in B above when serving on boards, agencies or
commissions of any kind at the direction of the City or with
the expressed or implied consent of the City, subject to that
board, agency or commission in B(2) above having paid its
allocated share of the self insurance cost.
D. Any entity the City is obligated by virtue of a written con-
tract to provide liability coverage, but only with respect to
operations performed by or on behalf of the City or facilities
owned or used by the City.
IV, DEFINITIONS
The words and phrases in italics in this memorandum have special
meanings:
A. Actual cash value - replacement cost, less depreciation.
B. City - the City of Lubbock.
C. Covered party - a person or organization set forth in Section
III.
D. Defense expense - fees and expenses related to the adjustment,
investigation, defense or litigation of a claim, including attor-
ney's fees, court costs and interest due on judgments. Defense
expense shall not include the salaries and overhead of employ-
ees of any covered party.
E. Program - the City of Lubbock Liability Self -Insurance Pro-
gram.
V. .5UBROGATION
In the event of payment by the program, the City shall be subrogated
to all of the covered party's rights of recovery against any entity.
The covered party shall do whatever is necessary to secure such rights
and shall do nothing after a loss to prejudice such rights.
PCCF
08/21/12
JCR:da
RESOLUTION
Page 14 of 16
Resolution #2481
December 11, 1986
Agenda Item #27
A RESOLUTION CREATING AND ESTABLISHING THE CITY OF LUBBOCK SELF
INSURANCE FUND; PROVIDING THE COVERAGE TO BE AFFORDED BY SUCH FUND AND
PROVIDING FOR THE MAINTENANCE AND ADMINISTRATION OF SAID FUND.
WHEREAS, the City of Lubbock has heretofore obtained liability
insurance coverage through the Texas Municipal League Joint Self
Insurance Fund; and
WHEREAS, the cost of maintaining such liability insurance through
the Texas Municipal League Joint Self Insurance Fund has dramatically
risen over the past three years due to the unavailability to said fund of
reasonable reinsurance; and
WHEREAS, the premium cost to the City of Lubbock to maintain
liability insurance with the Texas Municipal League Joint Self Insurance
Fund for the fiscal year 1986-1987 will be approximately one third of the
coverage limit provided; and
WHEREAS, the City Council of the City of Lubbock finds that it
would be wise and expedient to establish a liability self insurance fund
for the City of Lubbock and to set forth the coverage to be provided by
such fund; and
WHEREAS, the City Council finds that it would be in the best
interest of the citizens of the City of Lubbock to establish the City of
Lubbock Self Insurance Fund, set forth the coverage to be provided by
said fund, and to provide for the administration of said fund; NOW
THEREFORE:
BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF LUBBOCK:
SECTION 1. THAT there is hereby created a fund within the City of
Lubbock to be known as the City of Lubbock Self Insurance Fund.
SECTION 2. THAT the City Manager is hereby directed to transfer
the sum of Five Hundred Thousand Dollars ($500,000) from the City of
Lubbock Insurance Fund to the City of Lubbock Self Insurance Fund here
now created to establish said fund.
SECTION 3. THAT the City Manager shall, in preparing the annual
budget for the City of Lubbock, recommend to the City Council an
appropriation to be made to said fund in order that the fund shall be
maintained and increased to an amount sufficient to provide an actuarily
sound fund.
08/21/ 12 PCCF
Page 15 of 16
SECTION 4. THAT the City Manager is further authorized to transfer
additional funds from the City of Lubbock Insurance Fund to the City of
Lubbock Self Insurance Fund to the extent such funds are not needed for
other insurance coverage.
SECTION 5. THAT the City of Lubbock Self Insurance Fund shall
provide liability insurance coverage to the City, its employees,
officers, Board members and volunteers upon the same terms and conditions
as hereto afforded to said named individuals by the Texas Municipal
League Joint Self Insurance Fund all as set forth in the Texas Municipal
League Joint Self Insurance Fund Liability Coverage Document dated
October 1, 1985, a copy of which shall be deemed an official City
document and filed with the City Secretary.
SECTION 6. THAT the City of Lubbock Self Insurance Fund shall be
authorized to pay for all necessary services to adjust and defend all
liability claims made against the City of Lubbock for which no other
policy of insurance exists and said fund is further authorized to, in the
appropriate case, settle all such claims or to pay any judgments based
upon such claims.
SECTION 7. THAT the City Manager shall designate an officer or
employee of the City of Lubbock to act as the administrator of the City
of Lubbock Self Insurance Fund with the following powers and duties:
1. To keep the City Manager fully informed as to all aspects of
said Self Insurance Fund.
2. To make all disbursements from said fund for claims adjusting
and legal defense costs.
3. To make disbursements from said fund in settlement of claims
In the following manner:
(a) In cases where the claim is ten thousand dollars or
less he shall have full authority.
(b) In cases where the claim is more than ten thousand
dollars but less than twenty thousand the administrator
shall secure the approval of the Assistant City Manager
for Finance.
(c) In cases where the claim is for twenty thousand dollars
or more the administrator shall secure the approval of
the City Manager.
SECTION 8. THAT the City Manager is further authorized to issue
requests for proposals to insurance consultants to review and update
coverage to be extended by this plan as well as its actuarial soundness.
08.21 12 PCCF
Page 16 of 16
SECTION 9. THAT the City Manager is further authorized to issue
requests for proposals to secure claims adjusting and related services
necessary for this fund.
SECTION 10. THAT all claims handled under and through the City of
Lubbock Self Insurance Fund shall be considered insured claims.
Passed by the City Council this 11th day of December , 1986.
B. C. McMINN, MAYOR
ATTEST:
rezary
APPROVED AS TO CONTENT:
Robert Massengale, Astistant
City Manager for Financial Services
APPROVED AS TO FORM:
—John C. Ross, Jr., City Attorney
08/21 / 12 PCC F
Page 1 of 51
AMENDMENT NO 3 -- TO THE INTERLOCAL AGREEMENT
TEXAS POLITICAL SUBDIVISIONS PROPERTY CASUALTY
JOINT SELF-INSURANCE FUND
CASH FLOW PLAN
It is hereby agreed the Interlocal is amended to include the following wording:
I. Corrected wording regarding RFP question J: Does your company have the
ability to write checks locally and deliver them same day? Normal claims
checks will print from our Dallas office. However, your adjuster will have the
ability to write checks on -site for emergencies only.
II. TPS proposal and response to RFP 12-10629-DT:
CONFIDENTIAL SERVICES PROPOSAL FOR
THIRD PARTY LIABILITY CLAIMS ADMINISTRATION
SERVICES
PREPARED EXCLUSIVELY
for
luWty ock
TEMAS
01
TEXAS POLITICAL SUBDIVISIONS
PO Box 803356
DALLAS, TEXAS 75380
(800) 588-0013
WWW.TPSPOOL.ORG
08/21/12 PCCF
Page 2 of 51
Table of Contents
Section A
TPS Overview
Executive Summary
Section B
Scope of Services (detailed outline of handling procedures)
Claims Reporting
Best Practices — Property & Liability
Claims Administration
Client Services
Loss Prevention & Control
Section C
Required Information
RFP Cover Sheet
Suspension 8 Debarment Certification
Insurance Affidavit
Conflict of Interest Questionnaire
RFP Questions
Section D
Supporting Materials
Sample Contract
Insurance Certificate
References
Financial Statements
Section E
Fees & Expenses
Property & Liability Claims Administration Fees
Additional Service Fees
Allocated Loss Adjustment Expenses
08/21/ 12 PCCF
Page 3 of 51
Section A: TPS Overview
Executive Summary
Texas Political Subdivisions has served Texas public entities since 1983. We offer a
number of services ranging from fully insured workers' compensation and
property/casualty insurance to loss control, managed care, financing and claims
administration for self -funded programs. We have a total risk management package
that delivers the highest quality products and services that give you more.
The Trustees made a ground breaking decision in 2008 to bring all services in-house,
and eliminate all administration by its Third Party Administrator (TPA). Their decision
commenced the sweeping events over the next three years' time which shaped the
Fund into the success it is today. Their first order of business was to secure an
Executive Director (ED) in October 2008. Their ED soon after coordinated the transition
of marketing, loss control and accounting in April 2009. Continuing the transition,
underwriting came in-house December 2009, PC claims January 2011 and finally WC
claims in May 2011.
Since this transition TPS developed a comprehensive, well -structured and expertly
managed approach to handle every claim. Its claims professionals communicate clearly
with all parties involved and continuously monitor and manage all of the issues that can
affect the cost of a claim. Through its experience in all aspects of claims management,
TPS developed an exemplary set of best practices for the day-to-day conduct of the
business. The result is a cohesive, consistent service delivery from the first report of a
claim through to its successful resolution.
TPS Loss Control focuses on prevention by identifying areas of risk through surveys and
assessments. Recommendations generated by these surveys are followed by member
consultations, education and training on ways to implement programs/procedures that
will minimize hazards & exposures.
TPS is governed by a nine -member Board of Trustees, all active and committed
volunteers representing local governments all across Texas. Trustees are Fund
Members themselves and operate the Fund on behalf of the Fund Members pursuant to
TPS Bylaws. Trustees are elected by the membership to 4 year staggered terms. TPS
is headquartered in Dallas. We also have claims offices in Austin, Dallas, Houston and
Lubbock.
TPS is committed to a long-term partnership and we're confident the services provided
by TPS will not only meet, but exceed your expectations of what workers' compensation,
liability and managed care administration should be.
We appreciate your time and consideration.
09/21/12 PCCF
Page 4 of 51
Section B: Scope of Services
Claims Reporting
Minutes can be critical when an injured employee is on the way to an emergency room
or primary care facility. In a matter of days, a great deal of medical treatment may
occur, and if not managed properly, that treatment can cost more than it should or may
be inappropriate for the injury. Industry statistics indicate that for each day a loss report
is delayed, the average total cost of the claim is increased by $1,600-$2,100. The
sooner a claim is reported, the sooner we can gather and assess the facts, develop a
plan of action for resolution and help you contain costs.
The first report to injury can be received by the claims offices in the following manner:
• Internet/web base reporting: claims t s ool.or
• Facsimile: 1-866-888-3633
• 24/7 emergency toll free reporting service
• Mail: P O Box 803356 Dallas, TX 75380
Initial Set Up
Upon receipt of the first report of injury, a claim number will be established and all
pertinent claims data will be entered into the computer file within one (1) business day.
A supervisor/manger will review for severity and assignment.
08! 21 12 PCCF
Page 5 of 51
Best Practices — Property & Liability
Overview
This Best Practices Guide is intended to provide the foundation for the thought process
that goes into good claim handling. It is not a checklist to be used on every single claim.
The Best Practices Guide is designed to assist adjusters in finding the best ways to
bring those claims to a timely and fair conclusion. There are three major questions we
ask ourselves when reviewing a claim file for proper handling:
1. Did the adjuster THINK?
2. Did the adjuster exercise sound JUDGMENT?
3. Was the best overall RESULT achieved?
Critical Components
There are three critical components of good claim handling:
1. Coverage
2. Investigation
3. Evaluation/Disposition
When the adjuster thinks and applies sound judgment in these three areas, we see a
positive impact to results.
Set forth below are the Basic Questions and Best Practices for each Critical
Component. While the Basic Questions must be satisfied for each Critical Component,
the Best Practices should be considered on a file -by -file basis. They are designed to
provide the adjuster with a foundation for critical thinking in order to bring the claim to a
proper and timely conclusion. Remember that one of our main goals is to utilize our
resources wisely in resolving claims. If completion of any of the Best Practices is
required to satisfy any of the Basic Questions, then that activity should be completed
and evaluated in light of the facts of the claim. If completing any of the Best Practices is
redundant, or would not contribute to a proper resolution of the claim, then that activity
should not be undertaken.
Each claim file must speak for itself. It is the responsibility of the adjuster to document
the claim file in a manner that demonstrates that all of the Basic Question of each
Critical component have been answered satisfactorily and that the information contained
in those answers has been utilized properly. This embodies the concept of file strategy.
08 21 � 12 PCCF
Page 6 of 51
Critical Component One. Coverage
Each file needs to answer these Basic Questions:
1. Was the coverage in force?
2. Did the policy/contract cover the loss?
3. Was there other insurance or were other sources available? If so, was the other
insurance applied properly to the loss?
4. Was the coverage determination made in a timely manner?
Best Practices: Coverage
The following are points to consider in answering the Basic Questions:
• Confirm that the policy was in force. Verify the effective dates, limits,
endorsement numbers and titles, edition dates, terms and conditions of the
policy in accordance with established procedures. Review the policy language
as appropriate.
• Determine whether occurrence or claims made with appropriate trigger data.
• Be sure the Special Account Instructions are reviewed for special coverage
provisions. For example, concisely address special account provisions such as
deductible amounts, SIRs, excess coverage/carrier(s).
• Determine if:
o The individual or entity seeking coverage qualifies as a claimant;
o The allegations against the insured are within the coverage delineated by
the insuring agreement, exclusions, and definitions;
o The type of damages claimed are the kind the policy covers; and
o The policy conditions have been adhered to
• Advise the account immediately if further information is required before a final
coverage determination can be made. Also advise the account to protect its
interests, e.g., obtain an extension of time to avoid default, consider retaining
own counsel. Conduct additional investigation on a priority basis, subject to a
Non -waiver Agreement or Reservation of Rights. Indicate in the Reservation of
Rights Letter that a final coverage determination will be communicated as soon
as the coverage investigation has been completed.
• Upon completion of the coverage investigation, take a final coverage position
involving the account manager as required by existing procedures. If a
Disclaimer is approved, communicate that decision promptly to the account by
letter. If the decision is to continue handling while reserving our rights under the
policy, forward a final Reservation of Rights Letter to the insured. Be sure to
follow the Special Account Instructions for the account. Make sure the letter
specifically references all reasons under the policy for the disclaimer or
reservation of rights. The letter should not cite policy provisions that are
irrelevant to the claim.
• First communicate personally, (i.e., phone) and explain our coverage position to
the account/personal representative, agent/broker (producer).
• Determine whether there is additional insurance (excess or reinsurance) that
would cover the loss. Communicate with the representative of the other carrier
with respect to cost sharing, if appropriate.
08/21 12 PCCF
Page 7 of 51
Critical Component Two: Investigation
Our objective is to achieve a level of investigation that will enable us to evaluate both the
liability and damage exposures properly and timely. Tailor the investigation to the
exposure, taking into consideration what value is added prior to expending resources.
Keep in mind our obligation to protect the interests of our account.
The file needs to answer these Basic Questions:
1. What happened? What are the facts?
2. Who is responsible and why?
3. What are the verified damages?
4. Are the damages related to the loss in question?
5. Was the investigation done in a timely manner?
Best Practices: Investigation Of Liability
• Avoid liability assumptions and tailor investigation to magnitude of exposure
(e.g., rear -enders are not always 100% liability, left turns are not always 75%--
25% liability)
• Consider obtaining recorded statements that would add value in the following
instances:
o When liability is unclear
o When there is a potentially responsible third party and a right to
contribution or subrogation
• When investigating suspicious claims:
o Obtain copies of reports when they may be used to clarify or assist in
evaluating the client's liability exposure. Examples of these reports are:
police reports, fire department reports, weather reports, and the reports
of investigations by private or governmental agencies.
o Obtain tangible records, such as contracts, certificates of insurance,
leases, maintenance records, driver's logs, maps, or other evidence that
may be relevant to the event.
• If the claim arose out of a condition of land or premises, the investigation should
address the following:
The relationship of all persons or entities relating to the ownership, maintenance,
use, management and control of the land or premises
The existence of contracts or agreements between the persons or entities which
may affect their respective obligations
A description (photo/diagrams if warranted) of the condition out of which the claim
arose.
Consider the applicability of building codes, local ordinances, statutes, etc.
The facts surrounding the last time the premises were inspected and maintained
prior to the time of the loss.
If necessary, an expert's opinion regarding the condition out of which the claim
arose.
If the claim arose out of the client's products or warranty, the following areas should be
explored:
What is the product? Was it manufactured or distributed by the client?
Understand the basic application and use of the product.
What is the specific nature of the defect alleged?
08/21/12 PCCF
Page 8 of 51
How was the product being used at the time of loss?
Was it being used according to, or contrary to, instruction and/or warnings (obtain all
labels, instructions, warnings, if appropriate).
Was the product modified in any way? If so, how was it modified, when, and by
whom?
Was the product produced by our client the "end product" or was it a component part
for another end product? If the product was a component part, what is the
significance?
Is there vendor's coverage or are there hold harmless agreements?
If possible, secure and preserve the product, including labels, instructions. Consider
contacting counsel for guidance.
Is there a history of claims, recalls, or the like?
Consider statutes of repose.
Consider whether retention of expert is appropriate.
Best Practices: Investigation Of Damages
Bodily Injury Investigation
Obtain all necessary information from medical service providers concerning the nature
and extent of all claimed injuries, their causal relationship to the accident, the date of
treatment, whether there were any pre-existing injuries or conditions, probable
length of work disability, prognosis, and potential permanent disability.
Consider obtaining a medical/wage authorization from claimant to obtain medical
records directly from the medical providers.
Verify all claimed economic (past and future) injury damages.
Consider a peer review, association of an HSR, the use of vendor services, or an
independent medical examination.
Confirm income loss directly with the employer, where warranted.
Secure appropriate IRS returns. Consider obtaining personnel records from the
employer where appropriate. In claims of long-term disability, review Workers' comp
file or discuss with WC adjuster. Obtain copies of IRS returns for two years prior to
the accident, the year of the accident, and for each year subsequent to the accident.
Consider whether cost -sharing arrangements are appropriate.
Property Damage Investigation
Secure itemization of all claimed damages, including repair costs, loss of use, loss of
profits, damage to business reputation, loss of business opportunities, and another
direct or consequential damage.
Consider retaining appraisers, accountants or experts if damages are questionable or
significant.
Consider whether cost -sharing arrangements are appropriate.
Consider reductions for actual cash value (rather than replacement cost value) and
salvage.
Critical Component Three: Evaluation/Disposition
The file needs to answer these Basic Questions:
0821 12 PCCF
Page 9 of 51
What is the exposure?
Was the proper amount paid?
Were reasonable means and resources used to mitigate and negotiate the loss?
Were the evaluation and disposition accomplished in a timely manner?
Were reserves accurate?
Were reserves timely?
Best Practices: Evaluation
Once the investigation has addressed the appropriate issues, evaluate the claim in light
of your investigation, the venue of the claim, the opposition and any other factors
that should be considered.
Be realistic in evaluation the liability and damage exposures. Consider the value added
of further investigation; e.g., retention of experts, litigation, mediation and the like.
Use Colossus as an aid in evaluating the bodily injury component of the claim. (In
offices where Colossus is not being used, use the Evaluation Guide or equivalent
format).
Consider benefits of a face-to-face meeting of the claimant to evaluate the condition and
demeanor.
The use of developed mitigation opportunities is implicit in the proper disposition of a
claim. (Mitigation is discussed below.)
Best Practices: Mitigation Opportunities
Analyze coverage, liability, and damage investigation to identify all mitigation
opportunities.
Contact the claimant periodically to maintain control. When telephone or written contact
is inappropriate, involve an independent adjuster for a face-to-face meeting.
Screen bills, wage claims, and other items of damages to be sure those damages are
appropriate and reasonable.
Consider the applicable doctrines of negligence and joint and several liabilities. Seek
contribution or indemnity where it is appropriate.
Determine if a per -existing injury or condition caused or contributed to the claimed
damages.
If appropriate, arrange an independent medical examination of the claimant. Provide
the examining physician with copies of the claimant's medical records prior and
subsequent to the loss involving our insured. Consider having a physician or peer
review examine the claimant's medical records and provide an opinion regarding
causation, disability, etc.
Utilize the Central Index Bureau returns when information can assist current loss
assessment.
Consider activity checks to assist in determining a claimant's current physical activities
and condition in the absence of medical documentation, or where the disability
continues beyond a reasonable period.
Refer claim to the Fraud Unit if fraud is suspected.
Best Practices: Reserving
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Establish reserves timely for a current reflection of exposure. Be guided by the
following:
Avoid unnecessary file creation. The initial loss and damage description should justify a
file's creation.
Promptly establish proper loss/expense reserves. Continually evaluate appropriateness
of loss/expense reserves.
Establish the expense reserves.
Avoid minor reserves changes (stair -stepping) and overpayment where payments
exceed reserves.
Consider need for excess letter to account (copy to agent/broker).
Best Practices: Disposition
The disposition process should be objective, timely, and designed to produce good
results.
Once you have evaluated the claim, form an appropriate strategy (considering the
nature and the size of the claim) to bring the claim to a proper conclusion.
Consider whether aggregate limits are an issue.
Follow the special account procedures in disposition efforts.
Proactively pursue settlement.
Adequately document the negotiation process to show how the end results were
achieved.
Confirm verbal offers in writing.
Communicate, in writing, the basis of your decision when disclaiming coverage or
denying the claim.
Consider resolution through med pay where appropriate.
Consider first -call settlements, supported by telephone verification of specials. Project
medical expenses to facilitate resolution.
Conduct face-to-face settlement discussions when beneficial.
Diary according to claim needs to ensure timely claim resolution.
Consider advance payments when appropriate.
Alternative Dispute Resolution may provide an effective means for negotiating face-to-
face with the claimant's attorney.
Use proper litigation management techniques to avoid paying unnecessary legal
expenses.
Best Practices: Documentation/Reporting
Electronic or paper file will reflect concise documentation of activities, including dates,
times and sources.
Concisely address facts, allegations and plans in the activity log. Comments are to be
professional, objective and factually based.
08/21/12 PCCF
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For the purpose of focus (not necessarily for Supervisor Review), adjuster should
prepare a File Strategy within 30 days of assignment. This summary of activity
should address coverage, liability, damages, settlement values, reserves, costs, and
a disposition plan. Plans for future handling should include time frame for
completion. The file strategy should be revised and updated as necessary to
address the impact of new development and/or outstanding issues.
The length and depth of the file strategy should depend on the nature and the size of
the case.
Briefly summarize supporting documentation (i.e., medical, police, and other
investigative reports) in the adjuster notes. Verbatim copying of reports and
documents is not necessary.
Document photographs by providing the date and hour the photo was taken, the location
of the scene, the direction the camera was facing, and the distance from the subject.
Do not write on the photographs themselves since that may affect their admissibly
as evidence.
File submissions should set forth the reason for the submission, an analysis of pertinent
issues, including reserve adequacy and recommendations, if necessary, and plans
for disposition.
File Risk Alerts to identify any undesirable risk characters and/or premium return
considerations.
Concisely address special account provisions such as deductible amounts, SIRs, excess
cove rage/carriers(s).
Best Practices: Data Integrity
Maintain data integrity throughout the life of the claim file. Update the claim system
promptly.
Utilize the proper nature of benefit code, location code and tax reportable codes when
applicable. Accurate expense codes are critical to our profitability.
Record the date the loss notice was received as the reported date.
Utilize claim description code that accurately reflects the factual description without an
over reliance on "NOC" codes. (Update codes when facts clarify information.) Be
sure to enter the actual description of loss as opposed to examples supplied. This
will provide specific information for loss control purposes.
Select claim injury codes and coverage ID codes that accurately reflect the injury
sustained and update via element change as needed.
Ensure that the proper policy number, policy period, limit, aggregate and deductible are
entered for the loss.
If a claims -made policy, and a claim has actually been made, insert the claims -made
data.
Utilize directory tables for attorneys and medical providers.
Claims Administration
08/21 / 12 PCCF
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Claim Management
TPS is proud of our 27 year history of attentive service in managing claims for our
clients. Our philosophy in delivering claim service is simple: the customer is number
one. Our goal is to consult with each customer regarding his legal responsibilities to
injured workers and inform him of his options. We work with you to make sure the
options chosen are executed efficiently and cost-effectively. We work to achieve the
maximum positive impact on medical treatment, with the ultimate goal of returning your
injured employee to workplace as soon as possible.
TPS Claim Protocols
From the moment the call is made to our FirstCall hotline, an experienced professional
begins processing your claim immediately. Our adjusters are trained and their
performance evaluation is based on all aspects of solid claims management, including:
Aggressive claims handling
Prompt and thorough investigation
Recorded statements taken on questionable files
3-point contact within 24 hours of assignment
Supervisory review of all claims
Individual loss reserving
Payments made for all related workers' compensation benefits
Medical management provided on each file
Applicable state filings made
Recovery of third party and second injury fund claims included
In addition to superior claims management, TPS offers the following:
Experienced Claim Teams
Average claim experience of 20 years
Account —specific, state specific adjuster assignments
Adjuster assignment levels average 125 lost time files
Supervisor to adjuster ratio is 1:3 or 4
In-house continuing education program
Legal Services
In-house attorney as a resource and legal bill review
File coordination with defense counsel
Information Systems
Full -service claims administrative computer system, using a proprietary system
Web -based, on-line access to adjuster notes and financial information
Pre -formatted reports as well as an ad hoc reporting facility
Records retention program
08/2 112 PCCF
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Most of our services are performed by our claim professionals. However, when a
vended services partner is necessary, we understand that it remains our responsibility to
direct and control the assignment to assure that a timely, cost-effective, quality product
is delivered. Claim files are fully documented to indicate the reason for using outside
resources and authorization to use them. Invoices are carefully reviewed to assure
charges are reasonable, necessary and justified.
Adjuster Experience
We select our claims adjusters very carefully. Throughout the TPS system, we recruit
and hire the very best adjusters available. We look for experienced candidates who
exhibit leadership ability along with knowledge of claims, ambition, and excellent
communication skills.
The careful selection of adjusters has resulted in a claims team with an average of 20
years experience. With such a high level of professional expertise on the job, TIPS has
devised extremely effective management procedures that maximize our adjusters' time,
allowing them the opportunity to apply their abilities throughout the company.
Our adjusters work in teams of three and four, led by a veteran supervisor. This team
leader carries a reduced caseload so that he or she can mentor and supervise the team.
This approach has two
Important advantages:
It enables seasoned adjusters to maintain claim management proficiency while staying
current on the latest legislative, statutory and healthcare developments
It allows the veterans to share their expertise and knowledge with less experienced
adjusters, ensuring that all team members' benefit.
Our innovative team approach allows us to promote and reward our best adjusters while
allowing them the opportunity for enhanced professional growth. At the same time, they
share their knowledge and experience throughout the TIPS family of claims adjusters,
ensuring that our clients have the benefit of all levels of expertise within our company.
Reserving
Our reserving philosophy is simple —our adjusters promptly set reserves equal to the
probable ultimate exposure of each claim. For large, complex cases, the adjuster will
consult the supervisor and office manager to ensure that reserves are appropriate and
that the full range of claim management and resolution options are explored.
The reserve exposure is documented in the claim file and communicated to our clients
as specified by the claim handling instructions. Reserves are refined, as necessary,
when new developments that impact exposure occurs.
08 21 12 PCCF
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TPS reserving philosophy, procedures, and quality assurance help prevent both under -
and over -reserving. Our reserving practices are designed to head -off potential reserve
surprises.
Factors used to establish the reserves include:
Coverage
Compensability
Negligence and Damages
Nature of Injury
Extent of Injury, damage or loss
Anticipated Medical Treatment
Age/Gender/Occupation
Lost Wages
Anticipated Permanent Disability
Pre-existing Medical Conditions
Mitigating Factors
Litigation Management
Litigation management is another key component of TPS cost containment strategy.
Our goal is to reduce overall legal expense without increasing indemnity expense. Our
claim professionals retain responsibility for managing the litigation process -- it is never
abdicated to the defense attorney.
The TPS Legal Department helps you reduce defense costs in litigated cases and can
virtually eliminate defense costs in some cases. Our internal Legal Department provides
the services normally received from outside counsel, up until the filing of a lawsuit.
To achieve the best possible results, we manage litigation as follows:
Review claim files with adjusters and determine potential for subrogation of third party
matters.
When appropriate, pursue subrogation through negotiation and/or filing a motion to
intervene in the third party action, following it to a conclusion
Prepare documents and attend hearings for court -approved settlements of claims
Participate in settlement negotiations with plaintiff attorneys, when appropriate
Prepare and coordinate material for referral to outside defense attorney, thereby
reducing outside attorney fees
Legal research and review of files
Opinions as to issues of employee status, compensability, etc.
Coordinate outside defense, including negotiating fees, when claims proceed into
litigation
If necessary, review and process bills from outside attorneys on litigation matters
Review of files and reports
Fraud Detection & Deterrence
08/21 / 12 PCCF
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Each year an estimated $145 billion dollars is lost to claim fraud. Fraudulent claims
increase your costs, which ultimately are reflected in the price of your products and
services. Fraud is theft, but ironically, not all fraudulent claims begin dishonestly. In
fact, studies show that the great majority of workers' compensation fraud begins as
legitimate claims.
Fraud has its roots in poor claims management, such as:
Poor, irregular communication
Lack of a return -to -work game plan
Fragmented medical care.
It is our responsibility to pay attention to these details.
TPS offers aggressive fraud detection and prevention. Our claim professionals are
highly skilled in the identification and investigation of fraudulent claims. The process
begins with prevention through utilization of proactive claims management procedures.
However, our skilled adjusters maintain a thorough recognition and understanding of the
various fraud indicators, and if questions arise, will refer suspect claims to our Fraud
Unit for further examination.
Employees left at home without a work schedule and little to do between doctors'
appointments can develop what we call "disability syndrome", in which the employee
decides not to return to work. Our experience proves that care and concern for an
injured worker on the part of the employer can decrease the frequency of "disability
syndrome" and fraud. TPS claims protocols provide guidance for managing the
psychological, as well as physical health of the injured worker.
Our staff attorney, who has developed a package of Fraud Protocols and trained our
adjusters on their appropriate application, heads the TPS Fraud Unit. It is the position of
TPS that no claim is fraudulent until sufficient evidence exists to substantiate and
document the fraud. The TPS adjuster assigned to each case evaluates it for possible
fraud only when the case falls outside the template of "normal" cases described by the
TPS Claims Protocol system.
Once a case is referred to the Fraud Unit, an appropriate course of action will be
determined. A claims committee may review the claim and/or discuss it with the
adjuster managing it. The client will be notified, given information regarding the claim,
and will make the final decision of whether to deny it or pursue investigation.
Surveillance of the claimant may be utilized, with the client's approval.
Should the client choose to deny the claim and investigate, TPS will report the claim to
the proper authority for investigation and possible prosecution of fraud. TPS will not
take action against an employee without the recommendation and approval of the client.
We will never accuse anyone of making a fraudulent claim, but will simply present
whatever evidence or documentation we have to the proper authorities so they can
make a determination. Handling matters in this way, we preclude any claim of libel,
slander, or malicious prosecution.
08/21 / 12 PCC F
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Throughout the initial referral to the Fraud Unit, the investigation of the claim, and the
possible prosecution, TPS Legal Department and Fraud Unit provides consultation and
support to our clients.
08/21/12 PCCF
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Client Services
Account Management
TPS understands that open, ongoing communication is the key to a mutually successful,
long-term relationship. Our account management program is carefully designed to be
an extension of your risk management department. We assign an Account Manager to
you prior to the program inception. Your Account Manager is your single point of
contact and acts as your advocate on all service issues. The Account Manager's
primary responsibility is to ensure delivery of world -class service in addition to
overseeing all aspects of your program.
Your Account Manager is responsible for:
Developing and implementing (jointly with your Risk Management Staff) the service plan
for your account;
Monitoring your on -going claim service;
Addressing questions, issues, concerns, and needs;
Communicating your special account instructions to our claim offices;
Coordinating with your primary or excess carrier;
Attending periodic meetings and file reviews; and
Initiating renewal activities after the first cycle of service.
Service Plan
Led by your Account Manager, our team works with you develop a detailed Service Plan
that defines our commitment to you. The Service Plan details the services we will
provide, our responsibilities, and timetables specifying delivery dates and points of
service. Your Service Plan includes:
Claim management procedures, including mutually agreed upon claim management
requirements
Communication procedures
Loss control strategies
Managed Care services and objectives
Risk Management Information Systems and Services
Special Account Instructions
Prior to program inception, your Account Manager will work with you and your broker to
define your unique program preferences, standards and requirements. Your
requirements are integrated with our critical core standards to create your customized
account instructions. These written instructions become an integral part of your Service
Plan and should be revised in writing if necessary.
Your account instructions will cover a series of topics including:
Client and claim related contacts, including who to contact when a loss occurs;
08/21 12 PCCF
Page 18 of 51
Location coding information;
Reserve and settlement consultations, consultation levels;
Subrogation notification;
Interval reporting;
Loss run distributions;
Managed care instructions;
Litigation management instructions;
Denial/Reservation of Rights Advisories; and
Vendor assignments (surveillance, etc.)
The written instructions are distributed to all involved claim offices so that your claim
representatives have immediate access to your account instructions. A sample copy of
your Claim Service Instructions follows.
Quality Assurance
TPS utilizes its operations management and client audit staffs to conduct internal audits
of our claims operations. We conduct annual branch audits and adjuster audits on an
ongoing basis. Supervisors are required to adhere to the following audit procedures:
Total file sample should equal at least 5 per month per adjuster;
A minimum of 15 files per individual should be reviewed quarterly;
40% of total files reviewed should be closed files;
Files selected should cover a range of settlement amounts; and
File sample should include cases in litigation.
A Supervisor Checklist has been created for use in the review of claim files for
compliance with the Best Practices and quality control standards established by TPS.
Standards of satisfactory performance are outlined as well as standards for quality
performance. All areas are essential elements of proper claims handling. The Checklist
is used to assist in measuring compliance with company standards by individual
performances, as well as overall performance by unit, office and division. Identification
of strengths and weaknesses will assist in prioritizing training needs.
The Regional Manager is also required to review a minimum of two files per Adjuster
each quarter. The file selected for review will be from files previously reviewed by a
Supervisor. The purpose of the Regional Manager review is to validate the results of
the Supervisory Review.
Who is Evaluated and Frequency of Evaluations
Managers perform ongoing evaluations of Supervisors and Adjusters as required. If you
desire, we will provide you with a complete copy of our review guidelines.
In an effort to provide uniformity and consistency to a workers' compensation claim
audit, each area of performance will be commented on by the Manager. The fact that
acceptable scores for each area of performance varies should not be construed as
meaning any area is not an essential element of proper claim handling.
08/21/12 PCCF
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Procedures for selecting workers' compensation audit files are identical to our internal
audit procedures presented above.
A Supervisor Checklist is used in the review of claim files. Standards of satisfactory
performance are outlined as well as standards for quality performance. All areas are
essential elements of proper claim handling. A checklist is used to assist in measuring
compliance with company standards by individual performances, as well as overall
performance by unit, office and division. Identifying strengths and weaknesses assists
with prioritizing training needs. Each category is rated as follows:
N No or not satisfactory
Y Yes or satisfactory
N/A Not applicable
A "No" rating requires an explanation.
Best Practices Compliance
When reviewing the claim files for compliance with the company's Best Practices
standards and guidelines, the following issues are considered:
1. Coverage/Client Standards
Timeliness: It is our policy to investigate the facts and issue Reservation of Rights and
declinations where appropriate within the first thirty days from receipt of the loss. Our
coverage defenses must not be waived or stopped due to inaction by the claim handler.
A copy of the employer's first report and doctor's first report will be contained in the file.
The claims will be entered in the system in a timely manner.
Quality: Coverage issues must be recognized, properly analyzed, investigated and
addressed, in prompt fashion. Where reservations are issued, the claim handler must
remain aware that an open coverage issue exists and reanalyze the situation as new
information is received. This follow-up analysis should lead to one of the following
actions:
Rescinding of the reservation;
Denial of coverage; or
Notice to the client that the coverage issue remains open and all or part of our
Reservation of Rights remains in effect.
2. 24-Hour Contact
Timeliness: The insured, physician and injured worker (or their attorney) must be
contacted within 24 hours of receipt of the notice of loss. Witnesses must be contacted
as early in the investigation as possible. Follow-up contact must be completed in a
timely manner.
08/21,12 PCCF
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Quality: Contact is to secure as much information as possible regarding facts, injuries,
etc. The quality of the contact must be meaningful. Questions from the client and
injured workers must be answered including explanation of benefits. Issues of
compensability and coverage must be explained. We must explain what type of
documentation will be required and establish a date when we will be back in touch with
them. Contact must be documented in the file notes with date indicated, and signed by
the claim handler. Follow-up contact must be meaningful.
3. Investigation
Timeliness: The basic investigation should be substantially complete prior to the file
being case reserved. The investigation should start at the time of the initial contact with
all parties. Recovery must be pursued vigorously.
Quality: Each investigation must be specific to the individual situation. Form letters to
the client, injured worker or witnesses are not an acceptable means of conducting an
investigation. The pursuit of information must be aggressive and information cannot be
developed entirely through "discovery" if the case is in suit. Each case must be
investigated to the point where the claim handler can make a sound, reasoned decision
to either pay, compromise, or deny the claim.
4. Reserves/Indemnity Benefits
Timeliness: A reserve must be assigned at creation, which reflects the proper
evaluation at that time. The claim must be reserved no later than 90 days from the date
it is created. All revisions must be done within three days of developed additional
information, which would necessitate a reassessment of exposure. TTD benefits should
be paid timely and correctly utilizing wage information form. All notices according to
state statute for TTD, Permanent Impairment and MMI should be filed timely.
Quality: The reserve established must be supported by an evaluation prepared by the
Adjuster. The reserve must be broken out between indemnity, medical and expense if it
appears expenses will be incurred on the file. The reserve must be re-evaluated if
information upon which the reserve is based changes. Any change in the reserve must
be explained and reasons justifying the change documented in the claim file. The
reserve must reflect our best estimate of the ultimate exposure for indemnity and
expense. Over reserving and under reserving must be avoided. The process requires
that the wage information be obtained within three (3) days from creation and payments
be made with notices filed within the time frame of the state statute.
5. Subsequent Reporting/Delays and Denials
Timeliness: The process begins when the initial assignment is made to the claim
handler, at which time the Supervisor should highlight points to be covered. There
should be a discussion on the salient points of the claim file between the claim handler
and the Supervisor. These discussions should continue at critical stages in the
development of the file. The necessary reports are to be completed timely and detailed
to assist in the evaluation of the file. Any delay should be reasonable and notice made
in a timely manner. The appropriate forms should be filed and the denial supported with
accurate information released in a timely fashion.
08/21 / 12 PCCF
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Quality: The process must be a collaborative effort between the Supervisor and the
claim handler. The fact that the process occurred and the substance of the discussion
must be clearly documented in the file. During the process, and at critical points in the
file, there must be clear documented evidence of value added by the Supervisor. In
addition, there must be evidence that the claim handler is an active participant in the
discussion and reporting. The denial process should not be delayed, the investigation
should be completed and the denial filed within the guidelines of the statute. The
reason for the denial must be explained and within the confines of the state statute.
6. Medical Management
Timeliness: The process of verification of injuries should start at the time of initial
contact. Documentation of injuries must start as soon as the decision to either pay or
compromise the claim is made. The Adjuster must start medical management from the
creation of the file. The Adjuster is to maintain contact with the injured with the injured
party and work with the Medical Manager to accelerate recovery and return to work.
Quality: All medical treatment must be reviewed for appropriateness, causal
relationship and cost. Medical reports must be reviewed and scrutinized for proper care.
File documentation and interchanges are essential and must be in detail.
All cost containment measures must be taken. All claim files must be supported by
documentation of medical bills, medical reports and injuries. It is not acceptable to
simply take the worker's word on expenses. The amount must be verified either through
hard copy or telephone contact with provider. Severity of injuries and other aspects of
claim will determine which method is required.
7. Litigation Management
Timeliness: Initial instructions to counsel must be confirmed within two weeks of
assignment. All litigation must be handled in an aggressive, proactive style.
Quality: There must be a written, documented plan for handling the litigation. A
comprehensive legal plan must be evident and litigation management techniques
applied. The file must reflect communication between the claim handler and defense
counsel on litigation planning. The claim handler must discuss any problem with
unsatisfactory legal service with the claim Supervisor who in turn must address the
problem with the Managing Attorney or Senior Partner of the firm.
8. Vendor/Expense Control
Timeliness: In order to control expenses, proper instructions to vendors must be given
at time of assignment. Bills must be reviewed and paid or discussed with the vendor
within 2 weeks.
Quality: Effective claim handling includes obtaining quality work from vendors for a
reasonable price. Vendors must know what is expected. We must communicate our
expectations to our vendors and then review all billings prior to payment. Questionable
items must be challenged and payment refused when explanations do not bring the
billing within our guidelines.
08/21 / 12 PCCP
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9. Subrogation/Second Injury Fund/Deductibles & Retentions
Timeliness: Any potential source for recovery must be identified as soon as the first
report is reviewed and the investigation started. Recovery must be pursued vigorously
whether it is subrogation, second injury fund or apportionment.
Program information on coverage should be investigated to determine if a deductible
exists or if there is a retention level to consider.
Quality: The handler must complete the investigation and evaluate the recovery
potential. Timely notice of recovery rights must be filed. Assignment to counsel, if
needed, must be made in a timely manner. Final disposition with recovery must be
clearly documented in the file. The confirmation of a deductible or retention should be
completed within 24 hours of receipt of the claim and documented on the system and in
the claim file.
10. CIB/File Man agement/Reinsurance
Claim Forms: Must be utilized and entries readable, dated and signed. The claim
forms should be kept in date order in the file.
Diary: There is no such thing as a standard diary. Each case must be diaried based
upon the specific situation as evidenced in the individual claim file. The file must be
diaried for specific reasons. A file will be judged not satisfactory if there is no current
diary date.
Index Bureau Report: Use of the index system is mandatory. Indexing must be done
initially when the claim is reported and when additional information is obtained and
semi-annually during the life of the claim. If there is a specific reason for not filing a
CIB, the file should be properly documented. Information requests must be sent to
identified carriers when appropriate.
Mail Date Stamped: All mail must be date stamped to reflect the date it is received and
handled as required by state statutes or unfair claim practices.
Special Handling Requirements Met: Special handling requirements must be
documented in the file and followed. It is not possible to follow the requirements if
they are not known.
State Filings: Complete all state reports in the time prescribed by the legislative/judicial
law including Unfair Claim Practices.
File Notes: The file must have current file and progress notes with meaningful
information documented.
CIBs: The initial and follow-up CIB's should be completed when the file is created and
every six months thereafter depending on the type of file.
Supervisory Diary: The file should have a supervisory diary on all files over the
Adjuster's authority threshold.
11. File Disposition
Timeliness: The case should be resolved properly and the award paid in a timely
manner. A structured settlement should be considered where appropriate. The file
should be closed in a timely manner and approved by the Supervisor. All coding should
be accurate and Large Loss Report procedures followed.
08/21 / 12 PCCF
Page 23 of 51
Quality: The award should be paid according to the statute and proper notification sent.
Structured settlements, where economically feasible, should be considered. File closure
should be documented with an explanation of the closure and settlement reasoning. All
Large Loss Reports should be in detail and filed in accordance with account
agreements.
08/21 / 12 PCCF
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Loss Prevention & Control
No one wants to see accidents happen —that's why loss control is at the core of the TPS
philosophy. Our loss control professionals focus on prevention. By eliminating or
mitigating potential causes of injury for our customers and their employees, we reduce
the overall cost of loss. By listening to you and learning about your operations, we can
design and implement a customized safety and loss prevention program that will
significantly reduce the frequency and severity of injuries
Our loss control professionals are concerned with the human cost of loss. By
addressing safety issues before they cause injuries, we help protect our employer
partners and their employees from the uncertainty and worry that accompanies every
on-the-job injury. We care about safety and it shows in our work.
Our team of loss control professionals averages over 33 years of experience in safety
and loss prevention, workers' compensation, liability and property protection in a broad
range of industries, including:
Energy production and transmission
Petrochemical production
School Transportation
School Safety
Manufacturing
Retail
Construction
Healthcare — including JCAHO standards
Governmental entities
Safety School Kitchens
Transportation
TPS offers comprehensive Loss Prevention and Control services. Our loss prevention
professionals work closely with you to identify actual and potential workplace problems
and causes, design safer workplaces and help you navigate today's complex and
changing regulatory and environmental issues. Services provided include:
Periodic loss control visits to your site to complete a safety survey and evaluation.
Providing the results in a Client Service Report, identifying hazards, procedures, and
operations that present potential dangers to employees. Suggestions and
recommendations are made to help develop, implement, and enhance your in-house
employee safety program.
Working with client staff to design and implement a successful employee safety
program as an integral part of the workers' compensation plan.
Assistance in safety training for management, supervisors, and employees
Hazard recognition and response training
Accident investigation training
Assistance in addressing required safety compliance standards
Loss control services are offered on an ad hoc or regularly scheduled basis, and are
charged at a flat hourly or daily rate. Pricing specifics are included in the service fee
section of this document.
08/21 / 12 PCCF
Page 25 of 51
08/21 / 12 PCCF
Page 26 of 51
Section C: Required Information
RFP Cover Sheet
SUBMIT TO:
CITY OF LUBBOCK
toyCITY
OF LUBBOCK,TEXAS
Purchasing Contract
lubblock
Managementt
rlras REQUEST FOR
1625 13'h Street, Rm 204
Lubbock, Tx 79401-3830
AN EQUAL
OPPORTUNITY
EMPLOYER
PROPOSAL
12-10629-DT
CONTACT PERSON:
D'Ana Torres
TEL: 806.775.2167
FAX: 806.775.2164
hUpJ/purchasing.ci.lubbock.tx.us
TITLE: Third Party Administrator Liability
Claim
SUBMITTAL DEADLINE:
Services
June 20, 2012, at 3:00 p.m. CST
PRE PROPOSAL MEETING DATE, TIME AND LOCATION: June 13,
Any proparals received after the time and dale fisted above, regardless ajrhe
2012 at 3:00 at City Hall, 2"d Floor Conference Rm 1625
13'h St.
mode ofdrilvery, shall be rclumed nnapened
RESPONDENT �
5 / f S/ TS.RF
IF RETURNING AS A "NO RESPONSE", PLEASE STATE REASON.
_Lg4g
MAILING ADDRESS-
0 h . DG3, U1 `f 7
CITY — STATE — ZIP:
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`74
THE CITY OF LUBBOCK RESERVES THE RIGHT TO ACCEPT OR REJECT ANY
l ei [ K rT
AND ALL PROPOSALS IN WHOLE OR IN PART AND WAIVE ANY
INFORMALITY IN THE COMPETITIVE PROPOSAL PROCESS. FURTHER, THE
TELEPHONE NO:
CITY RESERVES THE RIGHT TO ENTER INTO ANY CONTRACT DEEMED TO
BE IN THE BEST INTEREST OF THE CITY.
IT IS THE INTENT AND PURPOSE OF THE CITY OF LUBBOCK THAT THIS
FAX NO:
'9W ` 3,5�3 ' d
P5I
REQUEST PERMITS COMPETITIVE PROPOSALS. 1T IS THE OFFEROR'S
RESPONSIBILITY TO ADVISE THE CITY OF LUBBOCK DIRECTOR OF
E-MAIL:
L
PURCHASING AND CONTRACT MANAGEMENT IF ANY LANGUAGE,
REQUIREMENTS, ETC., OR ANY COMBINATIONS THEREOF, INADVERTENTLY
FEDERAL TAX ID NO. OR SOCIAL SECURITY
RESTRICTS OR LIMITS THE REQUIREMENTS STATED IN THIS RFP TO A
NO.
SINGLE SOURCE. SUCH NOTIFICATION MUST BE SUBMITTED IN WRITING
AND MUST BE RECEIVED BY THE DIRECTOR OF PURCHASING AND
CONTRACT MANAGEMENT NO LATER THAN FIVE (5) BUSINESS DAYS PRIOR
TO THE ABOVE SUBMITTAL DEADLINE.
THE OFFEROR HEREBY ACKNOWLEDGES RECEIPT OF AND AGREES ITS PROPOSAL IS BASED ON ANY ADDENDA POSTED ON
BIDSYNC.COM
The City of Lubbock Charter slates that no officer or employee of the City can benefit from any contract, job, work or service for the municipality or be
interested in the sale to the City of any supplies, equipment, material or articles purchased. Will any officer or employee of the City, or member of their
immediate family, benefit from the award of this proposal to the above firm? YES NO
IN COMPLIANCE WITH THIS SOLICITATION, THE UNDERSIGNED OFFEROR HAVING EXAMINED THE REQUEST FOR PROPOSAL, AND
BEING FAMILIAR WITH THE CONDITIONS TO BE MET, HEREBY SUBMITS THE FOLLOWING. AN INDIVIDUAL AUTHORIZED TO BIND
THE COMPANY MUST SIGN THE FOLLOWING SECTION. FAILURE TO EXECUTE THIS PORTION MAY RESULT IN PROPOSAL
REJECTION.
By my signature 1 certify that this offer is made without prior understanding, agreement, or connection with any corporation, firth, business entity, or person
submitting an offer for the some materials, supplies, equipment, or service(s), and is in all respects fair and without collusion or fraud I further agree that if
the offer is accepted, the offeror will convey, sell, assign, or transfer to the City of Lubbock all right, title, and interest in and to all causes of action it may
now or hereafter acquire under the Anli-trust laws of the United States and the State of Texas for price fixing relating to the particular commodity(s) or
service purchased or acq 'red by th City of Lubbock. At the City's discretion, such assignment shall be made and become effective at the time the City
tend e na ay t to the or.
�Ik I AMA I A
Autho 'zed Signature Title
MM
Name Dales
THIS FORM MUST BE COMPLETED AND RETURNED WITH YOUR RESPONSE.
'UR/Bid Docs/RFP 12-10629-DT Page 5
08/21/12 PCCF
Page 27 of 51
Suspension & Debarment Certification
SUSPENSION AND DEBARMENT CERTIFICATION
Federal Law (A-102 Common Rule and OMB Circular A-110) prohibits non -Federal entities
from contracting with or making sub -awards under covered transactions to parties that are
suspended or debarred or whose principals are suspended or debarred. Covered transactions
include procurement contracts for goods or services equal to or in excess of $25,000 and all non -
procurement transactions (e.g., sub -awards to sub -recipients).
Contractors receiving individual awards of $25,000 or more and all sub -recipients must certify that
their organization and its principals are not suspended or debarred by a Federal agency.
Before an award of $25,000 or more can be made to your firm, you must certify that your organization
and its principals are not suspended or debarred by a Federal agency.
1, the undersigned agent for the firm named below, certify that neither this firm nor its
principals are suspended or debarred by a Federal agency.
COMPANY NAME: S'—
Signature of Company Official: ��4_2
Date Signed: 01, f Z01901-�t-
Printed name of company official signing above: I,i`K^ CAh
PUR/Bid Do&RFP 12-10629-DT Page 3
08'21 12 PCCF
Page 28 of 51
Insurance Affidavit
CITY OF LUBBOCK
INSURANCE REQUIREMENT AFFIDAVIT
To Be Completed by Offeror
Must be submitted with Proposal
I, the undersigned Offeror certify that the insurance requirements contained in this bid document have been
reviewed by me and my Insurance Agent/Broker. If I am awarded this contract by the City of Lubbock, I will be
able to, within ten (10) business days after being notified of such award by the City of Lubbock, furnish a valid
insurance certificate to the City meeting all of the requirements defined in this bid.
Contractor roriginal Si nature) Contractor (Print)
CONTRACTOR'S BUSINESS NAME: 11�/iCQ S 'Hzs 1i ti ((,A
(Print or Type)
CONTRACTOR'S FIRM ADDRESS: 15—teW ply' &III,
NOTE TO CONTRACTOR
If the time requirement specified above is not met, the City has the right to reject this proposal and award the
contract to another contractor. If you have any questions concerning these requirements, please contact the
Director of Purchasing & Contract Management for the City of Lubbock at (806) 775-2572.
RFP 12-10269-DT THIRD PARTY ADMINISTRATOR LIABILITY CLAIMS SERVICES
08/21 / 12 PCCF
Page 29 of 51
Conflict of Interest Questionnaire
CONFLICT OF INTEREST QUESTIONNAIRE FORM CIQ
For vendor or other person doing business with local governmental entity
This quastlonnalre reflects changes made to the law by H.B. 1491, 80th Leg., Regular Session.
OFFICEUSEONLY
This questionnaire is being filed in accordance with Chapter 176, Local Govemment Code
DWc Recelved
by a person who has a business relationship as defined by Section 176,001(1-a) with a local
governmental entity and the person meets requirements under Section 176.006(a).
By law this questionnaire must be filed with the records administrator ofthe local governmental
entity not later than the 7th business day after the date the person becomes aware of facts
that require the statement to be filed. See Section 176.006, Local Government Code.
A person commits an offense if the person knowingly violates Section 176.006, Local
Government Code. An offense under this section is a Class C misdemeanor.
1 Name of person who has a business relationship with local governmental entity.
I iltS kAt � r �' w� �'S I !r
Z
❑ Check this box If you are filing an update to a previously filed questionnaire,
(The law requires that you file an' updated completed questionnaire with the appropriate filing authority not
later than the 7th business day after the date the originally filed questionnaire becomes incomplete or inaccurate.)
3
Name of local government officer with whom filer has employment or business relationship.
Name of Officer
This section (item 3 including subparts A, B. C & D) must be completed for each officer with whom the filer has an
employment or other business relationship as defined by Section 176.001(1-a), Local Government Code. Attach additional
pages to this Form CIQ as necessary.
A. Is the local government officer named in this section receiving or likely to receive taxable income, other than investment
income, from the filer of the questionnaire?
F] Yes 71 No
B. Is the filer of the questionnaire receiving or likely to receive taxable income, other then investment income, from or at the
direction of the local government officer named in this section AND the taxable income is not received from the local
governmental entity?
Yes E-1 No
C. Is the filer of this questionnaire employed by a corporation or other business entity with respect to which the local
government officer serves as an officer or director, or holds an ownership of 10 percent or more?
a Yes F1 No
D. Describe each employment or business relationship with the local government officer named in this section.
�y1 '-
Signature of person doing buss ess with the governmental entity Date
Adopted 06/29/2007
08/21 / 12 PCCF
Page 30 of 51
RFP Questions
YES
NO
%
COMMENTS
1. CLAIM -HANDLING COMPANY
UALIFICATIONS
A. Does your company carry Professional Liability Insurance in
the aggregate amount of $1,000,000 that would apply to this
activity? If so, please provide a current certificate of
�(
insurance.
C. Are you a member of the Claim Index Bureau Reporting
,[
System?
i
D. Does your company have a Formal Quality Control program
�f
in place? Explain.
r
E. Does your company have an Automated Claim Reporting
System? If so, can the client have access? Is there a charge
1�
NO G(r
for client access? If so, how much?
F. Does your company have a 24-hour emergency number with
an adjuster that can respond in 30 minutes or less?
G. Can Loss Runs be provided monthly in an electronic format
compatible to Microsoft Excel? Is there an additional cost
'�
`,� CI�'
for this?
0
H. Does your company have the ability to act as the Account
Manager and Account Designee under Section l l l of the
MMSE Act of 2007? If not, who will you contract with?
What will the additional cost be to the City?
I. Does your company have the ability to act as the Reporting
Agent under Section I I I of the MMSE Act of 2007? If not,
who will you contract with? What will the additional cost
be to the City?
J. Does your company have the ability to write checks locally
and deliver them same day?
�^ M+r
tt��/--)•
08/21/ 12 PCCF
Page 31 of 51
YES
NO
%
COMMENTS
2. STAFFING AND TRAINING
A. Does have in-house
�JL �[ S��,/A,, Co�+C,��
your company an or ongoing training
for Explain.
c
Qum %' �P� `t-Z_
program claims personnel?
B. Does your company have an in-house or ongoing training
program regarding MMSE? Explain.
C. What is your average case load per adjuster per line of
p ��
fT
business? Please indicate the mix of claims that your
adjusters handle. For example, does your Liability adjuster
[00d u�OLI�Qj Its.
handle a mix of cases that would include both minor and
serious claims?
• General and Other Liability
• Automobile Liability
D. Does your company have caseload guidelines? If so, what
are they by line of business?
• General and Other Liability
y
• Automobile Liability
!�
Are they adhered to?
E. What is your average turnover rate for supervisors?
B�✓
F. What is your average turnover rate for adjusters?
6)
G. What is your average turnover rate companywide?
4�
H. Can we designate key adjusters to handle our losses?
1. Can we designate key supervisors to handle our losses?
08/21/12 PCCF
Page 32 of 51
YES
NO
%
COMMENTS
3. CONTACT PERSONNEL
A. Will your company provide a key person to:
• Assist in claim problem resolution?
• Coordinate activities?
Is there an addition fee? If so, how much?
C. Will the contact person have the:
• Authority to implement changes requested by the City
Risk Management?
• Authority to meet with City of Lubbock Risk Management
quarterly to discuss outstanding problems and issues?
• Is there a charge for these activities? If so, how much?
YES
NO
%
COMMENTS
4. BILLING AND COST
A. Are you willing to quote a fee for?
Option I
Option II
Option III
Option IV
B. Specifically, what are considered allocated expense? Please
SP qp�
list.
YES
NO
%
COMMENTS
5. CLAIM MANAGEMENT
A. Does your company have written claim handling standards
for:
• General and Other Liability
• Automobile Liability
`
X
If so, please forward a copy.
• Are recorded statements taken?
• What is the maximum diary allowed?
• Are action plans developed and followed on files?
08/21 12 PCCF
Page 33 of 51
YES
NO
%
COMMENTS
6. CLAIM HANDLING
y ST cc"e'.s bt
A. Are claims handled by telephone or field adjuster?
B. Is there additional costs for field adjusters? If so, what is the
No e-"5tG-W BUA-
unit used? What is the cost per unit?
t
U'
n
C. Will all claimants and the City Risk Management contacts
be made within 24-hours from the date notice received?
D. Does your company have written claim handling standards
that include:
• When recorded statements taken?
• What is the maximum allowable diary?
• Action plans being developed and followed on files?
A. What is your reserving philosophy?
B. Who is responsible for establishing reserves?
C, How soon are initial reserves set?
D. Is a reserve analysis contained in every file?
Please provide a
E. How often are reserves reviewed?
wsethor 13
10 p two
L
08/21/12 PCCF
Page 34 of 51
YES
NO
%
COMMENTS
8. REPORTING
A. Are captioned reports completed on files? If so,
• At what level?
• How often?
• provide sample
B. Are captioned reports sent to client? To insurance carrier if
required? If so, how often? Is there a fee? If so, how
�(
much?
f v
C. Are clients notified timely and in writing of hearings and
trials?
D. Will the City Risk Management Coordinator be kept
f
apprised of all claims as they deem necessary?
r
E. Are riles actively supervised? If so:
g D Odt�o
• How often?
• What reserve level?
It
F. Are files supervised by both branch and regional personnel?
x
YES
I NO
%
COMMENTS
9. CLAiiMSX]lLE REVIEWS
A. Does your company allow claim file reviews? If so, is there
an additional cost? What is the cost?
✓
N D Ce75'V
B. Does your company allow physical audits of claim files?
YES
NO
%
COMMENTS
10. STRUCTURED SETTLEMENTS
A. Does your company utilize structured settlements?
J
I�
B. Have you established guidelines when considering this
approach to settlement? If so, please provide a copy of these
guidelines.
C. Are there separate costs associated with this service? If so,
please provide your pricing structure
08/21/12 PCCF
Page 35 of 51
("You" in the text below refers to the Offeror; "We" refers to the City's Excess Insurer.)
I . You must give us prompt notice of any accident which may result in a claim or suit seeking an amount for
loss in excess of the City's "bodily injury by accident" retention. The notice must be no later than 30
calendar days from the date you are notified of such accident. The notice should include:
a. How, when and where the accident took place;
b. The names and addresses of any injured persons and witnesses; and
c. Complete details of the injury or death. iahlk D IL6�__
Authorized Signa e
2. You must furnish us with:
a. A monthly report which provides the following information (by claim year) for each claim or suit
which was outstanding, opened, revised or closed during the previous month: the identify of the
claimants or injured parties; the dates, places, description and cause of injuries; the amounts of
reserves for such claim or suit; claims expenses (both paid and outstanding) and payments of
claims; judgments or settlements. This report must be furnished not later than the 10'" day after the
end of each month.
b. Written notification of each claim or suit which has, should have, or is likely to have; without
regard to liability, a reserve equal to or exceeding fifty percent (50%) of theCity's retention.
Written notice must be provided as soon as possible, but no later than fifteen (15) calendar days
from the date you have sufficient knowledge of facts surrounding such claim or suit which could
put the City on notice that such reserve or payment is indicated. Complete files on such claim or
suit must be given to us within thirty (30) calendar days from the date we request such files.
c. Written notification of each claim or suit which involves serious injury. This notice must be
provided as soon as possible, no later than then (10) business days from the date you have
knowledge of such claim or suit. Serious injuries include, but are not limited to:
(1) Cord Injury —paraplegia, quadriplegia;
(2) Amputations — requiring prosthesis;
(3) Brain damage affecting mentality or central nervous system — such as permanent
disorientation, behavior disorder, personality change, seizures, motor deficit, inability to
speak (Aphasia), hemiplegic or unconsciousness (Comatose);
(4) Blindness;
(5) Burns — involving over 10% of body with third degree or 30% with second degree;
(6) Multiple fractures — involving more than one member or non -union of any part of the body;
(7) Fracture of both heel bones (Fractured or Bilateral OS Calcis);
(8) Nerve damage causing paralysis and loss of sensation in arm and hand (Brachial Plexus
Nerve Damage);
(9) Massive internal injuries affecting body organs;
(10) Injury to nerve at base of spinal canal (Cauda Equina) or any other back injury resulting in
incontinence of bowel or bladder;
(11) Fatalities;
(12) Any claim or suit not specified above that presents an unusual exposure to the coverage.
Examples include: sexual molestation, AIDS, rape, class actions and bad faith allegations;
or
(13) Any other serious injury which may involve our liability.
d. Individual written loss reports of all serious injuries must be given to us within thirty (30) calendar
days from the date you have knowledge of any claim or suit which involves serious injuries. This
�:PUR/Bid Docs/RFP 12-10629-DT Page 33
08/21 / 12 PCCF
Page 36 of 51
report must contain the facts surrounding the claim or suit, a description of injuries, suggested
reserves, recommendations for future claims handling.
Authorized Signa e
3. You must:
a. Immediately send us and the City copies or any demands, notice, summonses or legal papers
received in connection with the claim or "suit" or action involving a sum in excess of the City's
retention;
b. Authorize us to obtain records and other information;
c. Assist us, the City Attorney or others to furnish us with information we may request to evaluate the
"accident"; and
d. Fairly evaluate the value to settle the claim or "suit within tthe City' retention.
1 WoC �--
Authorized Sig ture Item
0821,12 PCCF
Page 37 of 51
Section D: Supporting Materials
Sample Contract Property/Casualty
TEXAS POLITICAL SUBDIVISIONS
PROPERTY/CASUALTY JOINT SELF-INSURANCE FUND
INTERLOCAL AGREEMENT
CONTRACT NUMBER
(Cash Flow Plan For Political Subdivisions)
This Interlocal Agreement entered into by and between the Texas Political
Subdivisions Property/Casualty Joint Self -Insurance Fund (hereinafter referred to as
"Fund") and the undersigned political subdivision of the State of Texas (hereinafter
referred to as "Fund Member") is for the purpose of providing liability, property and
automobile physical damage self-insurance funding; insurance; reinsurance; claims
administration; loss control services; and other risk management services as needed for
the "Fund Members" and their employees.
WITNESSETH:
The undersigned Fund Member, in accordance with the Interlocal Cooperation Act,
Chapter 791 of the Texas Government Code and the interpretation thereof by the Attorney
General of the State of Texas (Opinion #MW-347, May 29, 1981), and in consideration of
other political subdivisions executing similar Interlocal Agreements, does hereby agree to
become a member of the Fund. The conditions of membership agreed upon by and
between the parties are as follows:
Definition of terms used in this Interlocal Agreement.
Allocated Loss Expense -- the costs incurred in processing claims,
including but not limited to court costs, expenses for investigation and
adjustment of claims, legal expenses, cost containment services (such as
PPO discounts, rehabilitation services, medical management services),
costs in protection and pursuit of subrogation/recovery rights, and similar
expenses chargeable to a particular claim (excluding ordinary overhead
expenses of the Fund and/or its designee such as salaries and other fixed
expenses).
Board -- the Board of Trustees of the Texas Political Subdivisions
Property/Casualty Joint Self -Insurance Fund.
C. Loss -- the sums actually paid or payable by the Fund in the settlement or
satisfaction of any claim or suit for which a Fund Member is liable either by
adjudication or settlement made with the written consent of the Fund.
2. At the Fund's discretion, each Fund Member may adopt any or all of (1) the TPS
Joint Self -Insurance Fund General Liability Coverage, (2) the TPS Joint Self-
08/21/ 12 PCCF
Page 38 of 51
Insurance Fund Automobile Liability and Physical Damage Coverage, or (3) the
TPS Joint Self -Insurance Fund Property Coverage self-insurance plans.
Whichever Self -Insurance Plan(s) the Fund Member accepts, the Fund Member
agrees to adopt and accept the coverages, provisions, terms, conditions,
exclusions and limitations of the applicable Self -Insurance Plan(s) Coverage
Document(s). The limits of self-insurance, optimal coverages and deductibles
selected by the Fund Member will be shown on the Declarations of each coverage
document.
3. If the Fund Member adopts the TPS Joint Self -Insurance Fund General Liability
Coverage, or the TPS Joint Self -Insurance Fund Automobile Liability and Physical
Damage Coverage self-insurance plan(s) which cover liability exposures, it is
understood that by participating in this Self -Insurance pool, the Fund Member does
not intend to waive any of the immunities that its officers or employees now
possess. The Fund Member recognizes the Texas Tort Claims Act and its
limitations to certain governmental functions as well as its monetary limitations, and
that by executing this Agreement does not agree to expand those limitations.
4. This Interlocal Agreement shall commence at 12:01 a.m. on the date shown
as "effective date" on the signatory page of this Agreement, and shall
terminate at 12:01 a.m. on . This Agreement may be
terminated by (a) mutual consent or by (b) either party giving sixty (60) days
prior written notice of termination to the other party or (c) as otherwise
specified in this Interlocal Agreement or the Bylaws of the Fund.
The Fund member agrees to execute necessary authorization form(s) permitting
the Fund and/or its designee to obtain from other parties experience rating
information for the Fund Member.
6. The newly enrolling Fund Member who has not previously been a member of this
Fund or the Fund Member who has not previously operated under this Cash Flow
plan agrees to pay the Fund, on or before the inception date of this Interlocal
Agreement, an initial payment of one (1) month's estimated Claims Administration
Fee plus 1/12 of the estimated annual Contractor Charges such as Administrative
Services Fees, Loss Control Services, or other charges as set forth in Exhibit A
attached hereto. On or before the commencement of the third month after the
inception date of this Interlocal Agreement, the Fund Member agrees to pay an
amount equal to the actual Claims Administration Fee, the total Field Service Fee
(if any) of the first month of membership plus any other associated Claims
Administration Fee plus 1/12th of the estimated annual Contractor Charges. On or
before the commencement of the fourth month of this Interlocal Agreement, a
similar payment based upon the actual Claims Administration Fee of the second
month shall be paid to the Fund, with subsequent monthly payments to be paid
each and every month thereafter, based on the actual Claims Administration Fee
and applicable charges. The actual Claims Administration Fee of the Fund
Member are those fees paid by the Fund on behalf of the Fund Member in the
month which is two months prior to the billing month. However, the Fund and the
Fund Member may agree to a different payment plan.
08 21 12 PCCF
Page 39 of 51
7. The Fund Member who was a member of this Fund immediately prior to the
inception date of this Interlocal Agreement and has operated under this Cash Flow
plan agrees to pay the Fund for those services described in this Agreement and
the charges listed in Exhibit A attached hereto. Each month's billing will include
1/12th of the estimated annual Contractor Charges as described in Paragraph 6
above. Also included in this billing will be an amount equal to the actual Claims
Administration Fee of the Fund Member plus any other associated Claims
Administration Fee as set forth in Exhibit A.
8. The Fund will invoice the Fund Member monthly for these amounts due and the
payment by the Fund Member is due in the office of the Fund and/or its designee
on or before the beginning of the month. In the event the Fund Member fails or
refuses to make the payments of charges as herein provided, the Fund reserves
the right to terminate such Fund Member by giving ten (10) days written notice and
to collect any and all outstanding charges or other required payments which were
incurred prior to the date of the Interlocal Agreement termination.
9. It is further agreed that the Fund Member will create on or before the inception
date of the Interlocal Agreement a loss deposit with the Fund equal to a minimum
of two months estimated paid losses. This deposit will be adjusted periodically to
accurately reflect realistic monthly loss payments and/or timely invoice payments.
10. After termination of this Agreement, the Fund will continue to handle claims with an
accident date occurring during the term of this Agreement until such claims are
ultimately and finally disposed of or closed. After termination of this Agreement,
the Fund Member will pay the Fund each and every month, until all claims handled
by the Fund are disposed of, the monthly claims administration charge calculated
as described herein, and the monthly reimbursement of actual claims losses paid
on behalf of the Fund Member as determined herein. The Fund Member also
agrees to maintain with the Fund the loss deposit as determined herein. Upon
expiration of this contract, the Fund or its designated agent will continue to adjust
claims which occurred or are made during the Agreement Period.
11. In the event the Fund Member fails or refuses to make any required payment on a
timely basis as described herein, the Fund reserves the right, by giving ten (10)
days written notice, to cease all payments on behalf of the Fund Member and
return any files on active property/casualty claims to the Fund Member. In such
event, the Fund Member agrees to assume all liabilities and claims handling
responsibilities on those claims from the date of notification forward. The Fund
Member agrees to pay the Fund all charges and other required payments which
were incurred prior to the date of notification.
12. After termination of this Agreement, the Fund is not obligated to provide any of the
services as described herein except for claims administration services as
described in Paragraph 12 above.
13. Loss Control Services will be supplied by the Fund and/or its designee to Fund
Members to assist them in following a plan of loss control that may result in
reduced losses. The undersigned Fund Member agrees that it will cooperate in
instituting any and all reasonable loss control recommendations for the purpose of
08/21/12 PCCF
Page 40 of 51
eliminating or minimizing hazards that would contribute to losses. The loss control
services provided are, however, optional for the Fund Member. If the Fund
Member elects this service, its election shall be indicated on Exhibit A attached
hereto.
14. Pursuant to the terms and conditions of the applicable Self -Insurance Plan(s)
Coverage Documents, the Fund and/or its designee, agrees to administer any and
all claims after notice of claim has been given and to provide a defense where
appropriate. The Fund Member hereby appoints the Fund and/or its designee as
its agent to act in all matters pertaining to processing and handling of all claims
and shall cooperate fully in supplying any information needed or helpful in the
administration of those claims. The Fund and/or its designee shall carry on all
negotiations with any third parties or their attorneys and negotiate within authority
granted by the Fund. The Fund and/or its designee shall retain and supervise
legal counsel on behalf of and at the expense of the Fund as necessary for the
prosecution and defense of any litigation.
15. At the option of the Fund and/or its designee, a Fund Member may be allowed to
choose the legal counsel it deems most appropriate for the handling of any
individual claim. However, all decisions on individual claims shall be made by the
Fund and/or its designee, which includes the decision to appeal or not to appeal a
final adjudication at the trial court level. However, any Fund Member shall have
the right to consult with the Fund and/or its designee on any claim and have the
right to appeal any decision made by the Fund and/or its designee to the Board.
Any suit brought or defended by the Fund shall be brought or defended only in the
name of the Fund Member and/or its officers or employees.
16. The Fund Member will be solely responsible for future benefits payable and for
Funding its net reserve. The Fund Member agrees to hold the Fund harmless
from any and all claims (including attorney fees) that may be asserted against the
Fund for the non-payment of any claim due to the failure of the Fund Member to
maintain adequate reserves for the payment of claims.
17. The Fund agrees that all Fund transactions will be audited annually by a certified
public accounting firm.
18. The Fund Member agrees that it will appoint a coordinator of department head
rank or higher, and that the Fund and/or its designee shall not be required to
contact any other individual except this person. Any notice to or any agreements
with the Coordinator shall be binding upon the Fund Member. The Fund Member
may change the Coordinator by giving written notice to the Fund.
19. The Fund Member acknowledges that it has received a copy of the Bylaws of the
Fund, and it agrees to abide by these Bylaws and any amendments thereto and
any and all policies and procedures of the Fund.
20. The Fund Member shall have the right to appeal any decision or recommendation
of the Fund and/or its designee to the Board whose determination will be final. Any
appeal shall be made in writing to the Fund Secretary within 60 days of decision or
recommendation of the Fund and/or its designee.
08/21 / 12 PCCF
Page 41 of 51
21. Any parry hereto paying for the performance of governmental functions or services
shall make payments from current revenues available to the paying parry.
22. The Fund Member shall take no action to release, discharge or impair its right to
seek recovery of any amounts paid under this Agreement from any person or entity
legally responsible for the bodily injury, sickness or disease, or death for which
such payment is made. Nor may the Fund Member assign such rights without the
express, written approval of the Fund.
23. This Interlocal Agreement, together with all the Amendments, Supplements and
other attachments hereto, constitutes the entire agreement between the parties
and supersedes all previous Interlocal Agreements, promises, representations,
understandings and negotiations, whether written or oral, between the parties with
respect to the subject matter hereof.
24. If any portion of this Interlocal Agreement shall be declared illegal or held
unenforceable for any reason, the remaining portions shall continue in full force
and effect.
25. It is the intent of the Parties that the Fund and/or its designee and the Fund
Member each shall bear responsibility for any of its own negligence or its own error
or omission, including, but not limited to, claims alleging violations of the Texas
Insurance Code, the Deceptive Trade Practices and Consumer Protection Act, and
the common law duty of good faith.
26. The Fund and/or its designee shall not be held accountable for any increased cost
or expense to the Fund Member involving payments of claims, under any
contention by the Fund Member that a claim service, risk management service,
loss control service, or administrative service could have been handled differently.
27. The Fund Member agrees to timely provide all necessary information to the Fund
and/or its designee and to timely execute all necessary documents as may be
needed or required for the administration of the Fund.
28. Periodically each Fund Member will be provided a computer printout containing a
statement of claims cumulative for said Fund Member by Effective Date of that
Fund Member
08/21 / 12 PCCF
Page 42 of 51
TO BE COMPLETED BY FUND MEMBER
Fund Member Name gnature of Authorized Official
Date Type Name
Title
THE PROPERTY/CASUALTY COORDINATOR FOR THE FUND MEMBER IS:
Coordinator Name & Title:
Mailing Address:
Street Address:
Telephone Number:
Fax Number;
TO BE COMPLETED BY TPS FUND OFFICE
Effective Date of Agreement
Signature of Fund Secretary
Contract Number
Date
08/21 / 12 PCCF
Insurance
Certificate
CERTIFICATE OF LIABILITY INSURANCE
Page 43 of 51
DATE (MMIDWYYYY)
O4/l WO12
THIS CERTIFICATE IS ISSUED AS A MATTER OF INFORMATION ONLY AND CONFERS NO RIGHTS UPON THE CERTIFICATE HOLDER. THIS
CERTIFICATE DOES NOT AFFIRMATIVELY OR NEGATIVELY AMEND, EXTEND OR ALTER THE COVERAGE AFFORDED BY THE POLICIES
BELOW. THIS CERTIFICATE OF INSURANCE DOES NOT CONSTITUTE A CONTRACT BETWEEN THE ISSUING INSURER(S), AUTHORIZED
REPRESENTATIVE OR PRODUCER, AND THE CERTIFICATE HOLDER
IMPORTANT: If the certificate holder Is an ADDITIONAL INSURED, the pollcy(les) must be endorsed. If SUBROGATION IS WAIVED, subject to the
terms and conditions of the policy, certain policies may require an endorsement A statement on this certificate does not confor rights to the
certificate holder in lieu of such endorsement(s).
PROWLER
CONTACT
NAME Keith Alberts
Texas Political Subdivisions JSIF
PH HE Eat 972 361-R A/C No): am-14RI-6117151
AEL
DDDRREESS
15660 N Dallas PKWY, Suite 1175
INSURER 9 AFFORDING COVERAGE
NAIC N
Dallas TX 75248
INSURER A: Navigators Seclat Insurance Company
0042791
INSURED Texas Political Subdivisions JSIF
INSURER B: Texas Political Subdivision JSID
0056978
INSURER C:
15660 N Dallas PKWY, Suite 1175
INSURER D:
ftE:
Dallas TX 75248
:N,
NEURER F:
COVERAGES CERTIFICATE NUMBER: 0050505 REVISION NUMBER: 0505000
THIS IS TO CERTIFY THAT THE POLICIES OF INSURANCE LISTED BELOW HAVE BEEN ISSUED TO THE INSURED NAMED ABOVE FOR THE POLICY PERIOD
INDICATED. NOTWITHSTANDING ANY REQUIREMENT, TERM OR CONDITION OF ANY CONTRACT OR OTHER DOCUMENT WITH RESPECT TO WHICH THIS
CERTIFICATE MAY BE ISSUED OR MAY PERTAIN, THE INSURANCE AFFORDED BY THE POLICIES DESCRIBED HEREIN IS SUBJECT TO ALL THE TERMS,
EXCLUSIONS AND CONDITIONS OF SUCH POLICIES. LIMITS SHOWN MAY HAVE BEEN REDUCED BY PAID CLAIMS.
INSR
LTR
I TYPE OF INSURANCE
POLICYNUMBER
POLIC EFF
MWO
PDLJCY EXP
MWDDYrYYI
ON0T5
B
GENERAL LIABILITY
X COMMERCIALGENERAL LABILITY
CLAIMS -MADE a OCCUR
I
I
I
F0482
10/01/2012
10101/2013
EACH OCCURRENCE
S 1 000 000
FREW S Eaoccunence
5100.000
MED EXP (Any one person)
S $ 000
PERSONAL SADVINJURY
5 1,000,000
GENERAL AGGREGATE
S 2,000,000
GEN'L AGGREGATE LIMIT APPLIES PER:
POLICY PROJECT- LIx
PRODUCTS -COMPIOP AGG
520
$
B
AUTOMOBILE
X
JX
X
LIABILITY
ANY AUTO
ALL OWNED X SCHEDULED
AUTOS NON-OAUTOSWNED
HIREOAUTO$ M AUTOS
r
I
fSINGLE
I(EaCOMBINED
10/01/2012
10101/2013
LIMIT
$ 1,000,000
BODILY INJURY (Per person)
S
BODILY INJURY(Peracddenq
PROPERTY DAMAGE
Per a-Ident
$
S
s
UMBRELLA LUAS
EXCESS LIAR
OCCUR
CLAIMS -MADE
r_
I
F_
IS
EACH OCCURRENCE
S
AGGREGATE
S
DEO I I RETENTIONS I
B
WORKERS COMPENSATION
AND EMPLOYERS' LIABILITY
ANY PROPRIETOR/PARTNERIE%ECUTIVE YIN
OFFICBMEMBER EXCLUDED? N❑
(Mandatory In NH)
If yea. describe order
INS hal_
NIA
F
H0633
10/01/2012
10101/2013
X WC STATU- OTH-
E.L. EACH ACCIDENT
S 100O
E.L. DISEASE - EA EMPLOYEES
1,000,000
E.L. DISEASE - POLICY LIMIT
S 1,000,000
A
E80
F
71
NY12MPLOO42791C
05101/2012
05101/2013
$3.000,000 Each Claim
$3,000,600 Aggregate
$10,000 Each Claim Deductible
DESCRIPTION OF OPERATIONS 1 LOCATIONS I VEHICLES (Attach ACORD 101, Additional Remarks Schedule, If mom apace Is requlredl
Texas Political Subdivisions JSIF
15660 North Dallas PKWY, Suite 1175
Dallas, Texas 75248
972-361-6303
ACORD 25 (2010/05)
SHOULD ANY OF THE ABOVE DESCRIBED POLICIES BE CANCELLED BEFORE
THE EXPIRATION DATE THEREOF, NOTICE WILL BE DELIVERED IN
ACCORDANCE WITH THE POLICY PROVISIONS.
AUTHORED REPRESENTATIVE
Keith Alberts, Sales & Marketing Director
1988-2010 ACORD CORPORATION. All rights reserved.
The ACORD name and logo are registered marks of ACORD
08 21/12 PCCF
Page 44 of 51
References (active members)
1) Jane Hays, Director of Risk Management
Temple ISD
200 North 23rd
Temple, Texas 76504
361-572-5006
2) Larry Helgeson, Director of Risk Management
Galena Park ISD
14705 Woodforest Blvd
Houston, Texas 77015
832-386-1218
3) Mark Vechione, Director of Purchasing
Socorro ISD
12440 Rojas Drive
El Paso, TX 79928
915-937-0160
4) Alphonso Perez, Business Manager
Roma ISD
608 North Garcia Street
Roma, TX 78584
956-849-1377
5) Irma Hernandez, HR Director
San Antonio ISD
141 Lavaca
San Antonio, Texas 78210
210-299-5522
08/21/12 PCCF
Page 45 of 51
Financial Statements
I CAR II 7553H*rF�hprn, ,,
LC
RI6G8 & 755]H.+IZa,'.-i.nr.l arm
CRIINGRAM A4arl#mfre AL36117
71rr Yr1_w1a
a11i?rr a?37Ib, I
dM.0 Lr tea W rl
INDE'OWEINiT AUDITOR'S REPOT i
Board of Trustees
Texas Poetical Subdivisions Joint
Self-Insuranos Funds
Dallas, Texas
We have audited the accompanying balance sheets of Texas Political Subdivisions Joint Self -
Insurance Funds (TIPS) as of December 31, 2011 and 2010, and the related statements of hoome
and comprehensive income, changes in members' equity and cash flows for the years then ended.
These financial statements are the responsibility of TPS's management Our responsibirty is to
express an opinion on these financial statements based on our audits.
We conducted our audits in anolydanoe with U.S. generally accepted auditing standards. Those
standards require that we plan and perlbrm the audits to obtain reasonable assurance about whether
the financial statements are free of material misstatement. An audit includes examining, on a test
bass, evidence supporting the amounts and disclosures in the financial statements. An audit also
includes assessing the accounting principles used end significant estfir4ates made by management
as well as evaluating the overall financial stal ment presentation. We believe that our audits provide
a reasonable basis for our opinion.
In our opinion, dw financial statements referred to above present fairly, in all material respects, the
financial position of TPS as of December 31, 2011 and 2010. and the results of its operations and its
cash flaws for the years then ended in conformity varith U.S_ generally accepted accounting principles.
Our audits were conducted for the purpose of loaning an opinion on the financial statements as a
whole_ The combining balance sheets and contrining statements of income and comprehensive
income are presented for the purpm of additional analysis and are not a required part of the
financial statements. Such information is the responsibility of management and was derived from and
relates directly to the underlying accounting and eether records used to prepare the financiaF
statements. The information has been subjected to dw auditing procedures applied in the audit of the
financial statements and certain additional procedures, including comparing and reconciling such
iMormation directly to the underlying accounting and other records used to prepare the financial
statements or to the financial statements thernsekim and other additional procedures in accordance
with auditing standards generally accepted in the United States of America In our opinion, the
irrfomnation Is fairlystated in all material respects in relation to the financial statements as a whole.
11-'tW f+aka .ev,aJ 4.4.0
Montgomery, Alabama
May 18, 2012
08121i 12 PCCF
Page 46 of 51
Texas Political Subdivisions Joint Self Insurance Funds
Balance Sheets
Qecem6er1, 2011 2010
Assets
Cash and cash equivelerds
$ 11,612,272 $
11,453,417
Investments
10,534,799
10,791,653
RecMvables from crash flaw members
293,269
303,189
Contributions receivable
1,877,051
3,332,972
Accrued interest receivable
26,851
25,058
Deferred acquisition costs
502,240
5%,659
Reinsurance receivable on paid losses
1,562,586
3MI57
Reinsurance recoverable on unpaid losses
8,256,357
4,117,859
Deductible recoverable
113,792
69,383
Prepaid reinsurance
1,416,74E
1,223,656
Otherassets
36,279
20, M
Office equipment, net
307,343
42,642
Total assets $ 36,541,587 $ 32,190,908
Liabilities and members' equity
Liabilities
Unpaid loss and loss adjustment expenses $ 19,094,792 $ 15,746,929
Unearned member contributions 7,419,346 7,036,092
Accrued expenses 322,282 247.485
Accrued payroll expenses 20,736 20,457
Dividends payable 100,082 200,000
iMember deposits held 259,906 259,905
Total Iin 27,217,143 23,512,868
Members equity
Equity 9,325,148 8,678,744
A=mulated other comprehensive income (foss) (704) (704)
Total members' equity 9,324A" 8,678,040
Total liabilities and members' equity $ 36,641,587 $ 32,190,908
See accompanying notes to financial stahwrm s
-2-
08/21/ 12 PCCF
Page 47 of 51
Section E: Fees & Expenses
Liability Claims Administration
TPS proposes to provide claims administration services for the City of Lubbock claims
management program per the following schedule. Stated fees do not include loss or
allocated loss adjustment expense (ALAE) payments. A sample listing of ALAE items is
included at the end of this section,
Life of Contract Handling*
General Liability
Property Damage <$25,000 $300 per claim
Property Damage >$25,000 $350 per claim
Bodily Injury $375 per claim
Auto Liability
Property Damage $245 per claim
Bodily Injury $415 per claim
Med Pay/PIP $335 per claim
Collision/Comprehensive $175 per claim
Property
<$25,000 $265 per claim
>$25,000 $330 per claim
Business Interruption $300 per claim
Extra Expense $285 per claim
Other Coveraaes
E&O $665 per claim
Professional Liability $665 per claim
Garage Keeper $570 per claim
Public Official Liability $665 per claim
Law Enforcement Liability $665 per claim
Crime $570 per claim
Tail File (take-over) Handling
AL/physical Damage $125 per claim
BI (GL or AL) $175 per claim
PD (GL or AL) $235 per claim
Property $200 per claim
Other: Professional Liability $510 per claim
08/21 / 12 PCCF
Page 48 of 51
Additional Service Fees
Administration Fee $2,500
Information Services
Claims System Viewing I.D.'s, Training, On-line
Access $Included
Total conversion of prior claims data $3,900
08/21/ 12 PCCF
Page 49 of 51
Allocated Loss Adjustment Expenses
The following items are examples of allocated loss adjustment expenses, and are in
addition to the stated per -claim service fees. They will be charged to the file "as
vended".
Independent medical examinations and medical records
Medical cost containment services including hospital bill audit, provider bill audit, PPO
utilization, telephonic and field nurse case management services
Court costs and fees for service of process, outside attorney fees, court reporter and
stenographer services and transcripts
Witness fees and expenses
Bond premiums
Printing costs related to trials and appeals
Testimony, opinions, appraisals, reports, surveys and analysis of professionals and/or
experts
Trial and hearing attendance fees
Depositions, video statements
Private investigator fees
Vocational rehabilitation fees
Crisis management vendor fees
Alternate dispute resolution fees
Other vended services including, but not limited to field investigation
Loss Control Services $135 per hour
Invoicing
Invoicing for claim service fees will be done monthly on an "as incurred" basis for per
claim fees. The administration fee will be billed in full during the first months billing. All
ALAE including any managed care fees will be paid though the file.
Definitions of Injury categories
Incident Only Claim: A claim reported for record only purposes. No contacts, bill
payments, acknowledgements, or any other claim handling is anticipated or required.
Indemnity Claim: Any claim which requires any one of the following: medical payments
in excess of $5000; subrogation (or other offset) investigation or recovery;
compensability investigation and/or dispute; fraud investigation; extent of injury disputes;
payment of indemnity benefits of any kind; or lost time from work beyond the waiting
period.
Medical Only Claim: A claim that does not meet the definition of either an Incident Only
or Indemnity claim.
08.2I,12 PCCF
Page 50 of 51
III. TPS response to Clarifications request:
a) 1) On page 34, question 6.13 - states no charge for field investigation, but on
page 50, field investigation is listed as an allocated cost. 1 here will be no cost
for our adjuster to perform field investigations for I ubbock. I lowever, if our
adjuster needs additional Support and needs to utilize an outside adjuster
there will be a charge I he cost will be a strait pass through and billed as an
allocated cost directly to the claim file We will work with I ubbock to create a
%,ondor panel for such sera ices.
2) There is no mention of Auto & Property Appraisers - does TPS plan to
subcontract those services & if so, with whom? 1` e do plan to contac t
appraisals and bill as an allocated cost dn•c, tl� to the c laim file. t\'v w ill work
with I ubbock to create a vendor panel foi such Services.
3) Does TPS intend to have a local property & casualty adjuster, as the RFP
requires? ii es.
4) What is TPS plan regarding claims runoff outside the contract? 11 e pla n to
take o,. er the handling of an) open claims as of the contract start date at the
rate listed on page 48 (1 ail File/ I ake-Over I landling). I fie paper files will be
transferred from the old I P-1 to our adluster. In addition, data from the old
I PA will be converted to the 1 PS claims sS stem -Nn? claims still open after
contract termination will be handled with the same care at the rate specified
on page 48.
b) 1) What does the asterisk after "Life of Contract Handling" reference? I his
must have been a typographical error in our reprographics department. I leis
asterisk does not have any relevance on the pricing provided on page 48.
2) Please define "Loss Control Services" as it relates to liability claims? I he
City will have a designated loss control manage (Leo Benford CSP, ARM,
ALCM) assigned to their account. fhe loss control manage will work with
key department heads (designated by the City) to review liability loss history,
current liability procedures and evaluate key facilities to identify areas of
risk. All recommendations generated by this process will be presented to the
designate City contact. I lie outcome may result in education and on -site
training for specific departments on ways to implement programs and/or
procedures that will minimize hazards and exposures. If the city desires these
services they will be billed at $135 per hour.
I lowever, we will provide at no cost access to our streaming safety video
library. I hese high quality videos are specific to city issues, as well as
segmented by auto liabilityand general liability topics. I Here are about 300
videos to choose from (sonie in Spanish). In addition, we will provide at no
cost our auto glove box kits (see attached). These heavy-duty envelops maybe
kept in vehicles to store insurance cards, accident report forms or related
information.
08/21/12 PCCF
Page 51 of 51
c) 1) As requested two sample loss runs are attached (PDF and Excel formats).
Both loss runs are sample runs using sample data. Please keep in mind, since
these are samples we can and will adjust these reports for the City at needed
at no cost.
08 21 12 PCCF