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HomeMy WebLinkAboutResolution - 2022-R0400 - City of Lubbock Property InsuranceResolution No. 2022-RO400 Item No. 5.5 September 27, 2022 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 purchase for and on behalf of the City of Lubbock, property insurance coverage with Lloyd's of London, Hallmark Specialty Ins Company, Kemah, Zurich Ins Group, Fidelis Ins Company, Arch Specialty Ins Company, Rivington, Markel Ins Company, StarStone/Core Specialty Ins Company, James River Ins Company, Harleysville Ins Company, Mitsui Sumitomo Ins Company, RSUI Group, Intact Ins Group, Liberty Ins Company and Hiscox Ins Group, for a premium amount not to exceed a rate of .2817 per $100.00; and THAT the City Manager may execute any routine documents and forms associated with said insurance coverage. Passed by the City Council on September 27, 2022 ATTEST: Reb4cca Garza, City Secr APPROVED AS TO CONTENT: f4 7 t�7t� D. B1u�Koste ich, Chief Financial Officer i Jeff Hkrtsell, Deputy City Attorney vw:ccdocs/RES.Risk Mgmt-Property Insurance Coverage September 13, 2022 Resolution No. 2022-RO400 Commercial Property —City of Lubbock Insurance Company: Policy Term: Coverage: Annual Premium: Options to get to 4/1: Coverage: Policy Form: Certain Underwriters at Lloyds of London 10/01/2022to 04/01/2024 Property insurance covers your interest against direct physical loss or damage by covered perils to named property that you own or are required to insure. See attached schedule for covered locations. $2,618,732.13 Including Taxes & Fees (0.2817 Rate) $4,182,472.00 Including Taxes & Fees (0.2817 Rate) to expire 4/1/2024 All Risk Agreed Expiring From subject to Mandatory Zurich amendments and endorsements Perils: Risks of direct physical loss or damage including Flood and including Earthquake but excluding locations in California, Alaska, Hawaii or Puerto Rico and excluding Boiler and Machinery Breakdown subject to the policy form and exclusions and endorsements noted herein. Coverages: Real Property, Personal Property, Extra Expense, and other sub -limits as noted in the policy form. Territory: United States of America, Puerto Rico and the United States Virgin Islands. Locations: As per schedule of locations on file received by us on 8/10/2022 This quotation is based on the following values reported: Coinsurance: Property: nil% Time Element: nil% Valuation: - Real and Personal Property Replacement Cost; - Actual Loss Sustained on Time Element; - Contractor's Equipment, Vehicles and Trailers — 5 years or newer to be valued on RCV basis, older than 5 years on an ACV basis Limit: $400,000,000 Total Insured Value: $989,932,789 This proposal is merely a descriptive summary of coverage provided by the insurance companies being proposed and should be used for reference purposes only; it is not a binder and does not amend or alter the insurance contract. Please refer to the policy contract for specific terms, conditions, limitations, and exclusions. Proposal date: 09/06/2022 Prepared for City of Lubbock Confidential. © 2021 USI Insurance Services. All rights reserved. usi � 18 100% Sublimits: $50,000,000 Per Occurrence and Annual Aggregate as respects Flood except; $ 5,000,000 Per Occurrence and Annual Aggregate as respects Flood occurring within Special Flood Hazard Areas (SFHA), areas of 100-Year Flooding, as defined by the Federal Emergency Management Agency, including backup of sewers and drains $50,000,000 Per Occurrence and Annual Aggregate as respects Earthquake (Excludes California, Alaska, Hawaii, Puerto Rico, New Madrid Earthquake Zone Counties, and Pacific Northwest Earthquake Zone Counties) $ 5,000,000 Accounts Receivable $ 100,000 Arson or Theft Reward $10,000,000 Automobile Physical Damage — owned or leased vehicles located at or within 1000 feet of the covered location $ 2,500,000 Automobile Physical Damage — covered vehicles while over the road $ 5,000,000 Brands and Labels $ 2,500,000 Building Materials at off premises storage for property under construction $ 750,000 Contractors Equipment — per item subject to max per occurrence sublimit of $10,000,000 $ 2,500,000 Debris Removal or 25% of direct physical damage to covered property, whichever is less $ 250,000 Deferred Payments Included Demolition and Increased Cost of Construction: Demolition Coverage A (For the loss in value of the undamaged portion of the building as a consequence of enforcement of an ordinance or law that requires demolition of undamaged parts of the same building) $ 10,000,000 Demolition and Increased Cost of Construction: Demolition Coverage B (For the cost to demolish and clear the sire of undamaged parts of the same building, as a consequence of enforcement of an ordinance or law that requires demolition of such undamaged property) $ 10,000,000 Demolition and Increased Cost of Construction: Demolition Coverage C (For the increased cost of repair or reconstruction of the damaged and undamaged property on the same or another site, limited to the cost that would have been incurred in order to comply with the minimum requirements of such law or ordinance regulating the repair of reconstruction of the damaged property of the same site. However, this Company shall not be liable for any increased cost of construction loss unless the damaged property is actually rebuilt or replaced) $ 5,000,000 Errors and Omissions $ 5,000,000 Expediting Expenses $ 5,000,000 Fairs and Exhibitions $ 1,000,000 Fine Arts ($100,000 per item limitation) This proposal is merely a descriptive summary of coverage provided by the insurance companies being proposed and should be used for reference purposes only; it is not a binder and does not amend or alter the insurance contract. Please refer to the policy contract for specific terms, conditions, limitations, and exclusions. Proposal date: 09/06/2022 Prepared for City of Lubbock Confidential. © 2021 USI Insurance Services. All rights reserved. USI js $ 500,000 Fire Brigade Charges & Extinguishing Expenses $ 1,000,000 Installation Coverage $ 1,000,000 Land & Water Clean -Up $ 100,000 Locks & Keys $ 5,000,000 Miscellaneous Unnamed locations $ 50,000,000 Newly Acquired Property $ 500,000 Outdoor Property Included Pairs or Sets $ 1,000,000 Personal Property Not at a Covered Location $ 1,000,000 Preservation of Property $ 250,000 Professional Fees $ 5,000,000 Property in the Course of Construction. $ 100,000 Property Removed from a Covered Location $ 500,000 Salespersons Samples $ 5,000,000 Service Interruption $ 2,500,000 Spoilage $ 1,000,000 Transit $ 1,000,000 Upgrade to Green Construction. 25% of amount payable for direct physical loss or damage, subject to maximum of $1,000,000. This includes any Time Element loss attributed to Upgrade to Green. $ 5,000,000 Valuable Papers and Records Sublimits Applicable to Additional Time Element Coverages (part of and not in addition to the Policy Limit) $ 1,000,000 Attraction Property (30 days) $ 100,000 Contractual Penalties $ 100,000 Crisis Management (30 days) $ 25,000,000 Extra Expense $ 1,000,000 Ingress & Egress (30 days) $ 1,000,000 Interruption by Civil or Military Authority (30 days) $ 100,000 Logistics Extra Cost $ 1,000,000 Rental Value $ 100,000 Royalties $ 1,000,000 Service Interruption (Qualifying Period: 24 hrs) $ 1,000,000 Soft Costs This proposal is merely a descriptive summary of coverage provided by the insurance companies being proposed and should be used for reference purposes only; it is not a binder and does not amend or alter the insurance contract. Please refer to the policy contract for specific terms, conditions, limitations, and exclusions. Proposal date: 09/06/2022 Prepared for City of Lubbock Confidential. © 2021 USI Insurance Services. All rights reserved. ,� 10 Deductibles: $250,000 per occurrence except as follows: With respect to Flood: $250,000 per occurrence, except as follows: $500,000 per Building, plus $500,000 Contents per Building, plus $100,000 Time Element per Occurrence for locations that are wholly or partially within High Hazard Flood Zones. With respect to Earth Movement: $250,000 per occurrence, except as follows: No Coverage for locations in California, Alaska, Hawaii, Puerto Rico, New Madrid Earthquake Zone Counties, and Pacific Northwest Earthquake Zone Counties. With respect to Windstorm or Hail: 3% per occurrence With respect to Airport Buildings: Bldg ID #154 — LIA Hanger Building #310 (Chaparral)— 5417 N. Walnut: $50,000 per occurrence Bldg ID #204 — LIA Hanger #32 (G&G Avionics)— 5902 N. Cedar: $50,000 per occurrence Bldg ID #292 — LIA Warehouse Building #710 (Nortec) — 2828 E. Dubuque: $50,000 per occurrence Bldg ID #294 — LIA Warehouse Building #714 (Marco)— 5612 N. David Avenue: $50,000 per occurrence Bldg ID #295 — LIA Warehouse Building #716 (Marco Steel) - 5618 N. David Ave.: $50,000 per occurrence With respect to Contractor's Equipment: $25,000 per occurrence (applies to equipment less than $250,000 in value) $50,000 per occurrence (applies to equipment valued at $250,000 or greater) With respects to Automobile Physical Damage — Covered Vehicles Over the Road $250,000 per occurrence With respect to Time Element: 24 Hours If two or more deductible amounts provided in this policy apply to a single occurrence, the total to be deducted shall not exceed the largest deductible applicable unless otherwise stated in the policy. However, if: 1) The Time Element deductible and another deductible apply to a single Occurrence, then the Company shall apply both deductibles to the Occurrence; and 2) Covered Loss or Damage by Flood arises out of a Named Storm, then the Company shall apply the Flood deductible or the Named Storm deductible, whichever is greater This proposal is merely a descriptive summary of coverage provided by the insurance companies being proposed and should be used for reference purposes only; it is not a binder and does not amend or alter the insurance contract. Please refer to the policy contract for specific terms, conditions, limitations, and exclusions. Proposal date: 09/06/2022 Prepared for City of Lubbock Confidential. © 2021 USI Insurance Services. All rights reserved. .� 11 Conditions: Remove Liberalization All Risk of Direct Physical Damage Time Element — Must be due to " physical loss or damage of the type insured against" Livestock, Animals — Animal Mortality excluded Standing timber— excluded Growing Crops excluded Spacecraft/Satellites and Associated launch vehicles and any property contained therein excluded Watercraft or Aircraft excluded Land & Water excluded Transmission and Distribution lines situated beyond 5,000 ft excluded Civil/Military Authority must have prohibited access wording Service Interruption - Must include exclusion for Satellites; it is satisfactory to have an exclusion of Satellites at part of property not covered with lead in wording in the Service interruption clause that states; "This extension of coverage applies only when such interruption of service is caused by direct physical loss or damage insured by this POLICY to any property of the type insured by this POLICY of the supplier of such services if such property is situated within the Policy Territory." Hostile Acts/War and Weapons Civil War Subject to satisfactory review and acceptance of all terms conditions and language in the manuscript policy form. Satisfactory inspections at key locations and compliance with essential recommendations. This applies to business that we write or share on a primary basis. Minimum Earned Premium: 35% Minimum earned premium applies. Applicable Law; Court Jurisdiction The laws of the State of New York, without regard to any conflict of laws rules that would cause the application of the laws of any other jurisdiction, shall govern the construction, effect, and interpretation of this insurance agreement. This proposal is merely a descriptive summary of coverage provided by the insurance companies being proposed and should be used for reference purposes only; it is not a binder and does not amend or alter the insurance contract. Please refer to the policy contract for specific terms, conditions, limitations, and exclusions. Proposal date: 09/06/2022 Prepared for City of Lubbock Confidential. © 2021 USI Insurance Services. All rights reserved. 12 The parties irrevocably submit to the exclusive jurisdiction of the Courts of the State of New York, and to the extent permitted by law the parties expressly waive all rights to challenge or otherwise limit such jurisdiction. Terrorism Risk Insurance Act of 2002, as amended 2015 (TRIPRA) - Notice of Premium Amount; Notice of Program Cap This quotation offers coverage for Insurer's share of liability for loss caused by certified acts of terrorism as defined in the Terrorism Risk Insurance Program Reauthorization Act of 2015 (TRIPRA). Coverage provided for losses resulting from certified acts of terrorism may be partially reimbursed by the United States government under a formula established by federal law. However, your policy may contain other exclusions which might affect coverage, such as an exclusion for nuclear events. Under the formula, the United States government generally reimburses a specified percentage of covered terrorism losses exceeding the statutorily established deductible paid by the insurance company providing the coverage. The percentage of covered terrorism losses exceeding the deductible paid by the insurance company providing the coverage for which such insurance company will be reimbursed by the United States government is: •85% for losses occurring in 2015; •84% for losses occurring in 2016; •83% for losses occurring in 2017; •82% for losses occurring in 2018; •81% for losses occurring in 2019; •80% for losses occurring in 2020 The premium charged for the coverage quoted herein does not include any charge for that portion of any terrorism loss to be paid by the United States government. TRIPRA contains a USD100 billion cap limiting United States government reimbursement as well as insurers' liability for losses resulting from certified acts of terrorism when the amount of such losses exceeds USD100 billion in any one calendar year. If the aggregate insured losses for all insurers exceed USD100 billion, insured losses up to that amount are subject to pro rata allocation in accordance with procedures established by the Secretary of the Treasury. That part of the total premium amount quoted herein by Insurer that is attributed to coverage pursuant to TRIPRA is provided above in Premium section of this quotation. In the event that the Insured declines to purchase TRIPRA coverage, the policy will contain a Terrorism Exclusion. Cancellation: 90 days except 10 days for nonpayment of premium This proposal is merely a descriptive summary of coverage provided by the insurance companies being proposed and should be used for reference purposes only; it is not a binder and does not amend or alter the insurance contract. Please refer to the policy contract for specific terms, conditions, limitations, and exclusions. Proposal date: 0 022 Prepared for City of Lubbock Confidential. C�J 2021 021 USI Insurance Services. All rights reserved. .l 13 SUBJECTIVITIES: - Confirmation if accepting/rejecting TRIA There are subjectivities that: 1) must be complied with or resolved before the contract becomes binding, 2) apply both before or after inception, compliance with which is a condition of all or part of the coverage; and 3) apply after the formation of the contract as conditions of continued coverage. SPECIAL CONDITIONS / OTHER COVERAGES: NO FLAT CANCELLATIONS ALL FEES ARE FULLY EARNED AT INCEPTION Please note that this is a quote only, and the Insurer reserves the right to amend or withdraw the quote if new, corrected or updated information creating a material difference from the previously provided underwriting material is received. This quote summary, the fees quoted and our advice, is confidential. If you need further information about the quote, our fee or the Insurer that is proposing to provide your insurance, please contact us. We will need a written request in order to bind coverage. If the Insurer binds the risk following your written request, the terms of the policy currently in use by the Insurer will govern the Insurer's quote. TAXES & FEES: IMPORTANT NOTE: The Home State of the Named Insured shall be determined in accordance with the provisions of the Nonadmitted and Reinsurance Act of 2010,15. U.S.0 §8201, etc. ("NRRA"), and the applicable law of the Home State governing cancellation or non -renewal of insurance shall apply to this Policy. Taxes are provisional based on the insureds acceptance of TX as their home state. Surplus lines taxes quoted may be subject to change based up on updated risk information or changes to tax rates or governmental fees. State surcharges and/or fees charged by the Insurer may not be included herein and will be billed at a later date. GENERAL TERMS In all cases, policy and carrier wordings take precedence. DEPOSIT PREMIUM The deposit premium is the minimum portion of premium due to the carrier at the inception of the policy. The premium for the policy term will be adjusted according to the provisions stated in the policy. MINIMUM PREMIUM The minimum premium is the LEAST amount of premium retained by the carrier if the policy is in effect for the full term. This proposal is merely a descriptive summary of coverage provided by the insurance companies being proposed and should be used for reference purposes only; it is not a binder and does not amend or alter the insurance contract. Please refer to the policy contract for specific terms, conditions, limitations, and exclusions. Proposal date: 09/06/2022 Prepared for City of Lubbock Confidential. © 2021 USI Insurance Services. All rights reserved. .� 14 MINIMUM EARNED PREMIUM The minimum earned premium is the LEAST amount of premium that will be retained by the carrier in the event of cancellation. The actual amount of earned premium retained will be the GREATER of the actual premium developed based on the time the policy was in effect OR the minimum earned premium as stated in the policy. MINIMUM EARNED PREMIUM: 35% Minimum earned premium applies. Building Vacancy Provision - Coverage may be restricted or excluded for any Building found to be vacant for a minimum of 30 consecutive days or longer subject to all other policy terms and conditions. If any of your covered buildings meet this description at any time during the policy period, please contact us so we can assist you in maintaining appropriate R coverage. Protective Safeguard Endorsement - Failure to maintain the protective safeguards in good working order or failure to notify the insurer of even a temporary impairment in protection suspends coverage until the protection is restored. Property — Coinsurance Coinsurance is a policy provision requiring the insured to carry insurance equal to a specified percentage of the value of the property covered. It provides for the full payment, up to the policy limit, of all losses if the insured has insurance at least equal to the specified percentage of the value of the property covered. The loss payment, in the case of most partial losses, is reduced proportionately if the amount of insurance falls short of the named percentage. The formula: Amount purchased Amount required x Loss = Amount paid - Deductible Example: If you have a $100,000 value building insured with an 80% coinsurance clause, you are required to carry a limit of at least $80,000. Failure to do so would penalize you in the event of a loss. Here's how a $25,000 loss would be settled if you insured the building for $70,000. $70,000 amount carried x $25,000 = $21,875 less applicable deductible $80,000 Amount required (80% of $100,000) You would collect only $21,875 less the deductible. Please be sure you understand this important clause. Insure property to the limit required by the coinsurance clause. Excluded coverage or other coverages sought may be available: please discuss with USI Other exclusions and policy limitations may apply. Please refer to the actual policies for specific terms, conditions, limitations, exclusions and sublimits that will govern in the event of a loss. This proposal is merely a descriptive summary of coverage provided by the insurance companies being proposed and should be used for reference purposes only; it is not a binder and does not amend or alter the insurance contract. Please refer to the policy contract for specific terms, conditions, limitations, and exclusions. Proposal date: 09/06/2022 Prepared for City of Lubbock Confidential. C) 2021 USI Insurance Services. All rights reserved. .� 15