10/26/2017. Insurance Limits and Deductibles What s In Your Policies? Annual Renewal Assessment. Changes in the District

Size: px

Start display at page:

Download "10/26/2017. Insurance Limits and Deductibles What s In Your Policies? Annual Renewal Assessment. Changes in the District"

Pierce Reed
5 years ago
Views:

1 Insurance Limits and Deductibles What s In Your Policies? MASBO Fall Conference November 3, 2017 Kerry Leider Risk Management Consultant, Property and Casualty Marsh & McLennan Agency 7225 Northland Drive North Suite 300 Minneapolis, MN John Siffert Risk Management Consultant, Property and Casualty Marsh & McLennan Agency 7225 Northland Drive North Suite 300 Minneapolis, MN Changes in the District Transportation Vehicles School Board Dynamics Human Resources Property Value Emerging Risks Market Conditions Instructional & Academic Administrators & Staff Annual Renewal Assessment : INSURANCE PROPOSAL Package Coverage Carrier s Proposal COVERAGE LIMITS - DEDUCTIBLE PROPERTY Blanket Buildings, Personal Property and In Open $48,593,703 Deductible $5,000 Blanket Business Income & Extra Expense $125,000 $1,000,000 Earthquake $100,000 Flood $100,000 Building Ordinance Policy Limit - Undamaged Portion $250,000 - Demolition $250,000 - Increase Cost of Const. INLAND MARINE Musical Instruments $187,000 Band Uniforms $50,000 Scheduled Equipment $48,719 Commercial Articles-Audio Visual $159,000 Athletic Equipment $50,000 Fine Arts $50,000 Dwellings Under Construction $100,000 Computers (EDP) $1,090,000 Data Compromise $100,000 1

2 : INSURANCE PROPOSAL Package Coverage Carrier s Proposal COVERAGE LIMITS - DEDUCTIBLES GENERAL LIABILITY Each Occurrence $1,000,000 Aggregate $2,000,000 Fire Damage Liability $300,000 Medical Payment (excludes students) $15,000 Employee Benefit Liability $1M/$3M Sexual Misconduct $1,000,000 Innocent Party Response $300,000 Violent Event Response - Each Person Limit Loss - Each Violent Event Limit - Aggregate Limit $25,000 $300,000 $300,000 CRIME Employee Dishonesty $100,000 Forgery or Alterations $100,000 Money & Securities $50,000 Computer Fraud $100,000 Deductible $ : INSURANCE PROPOSAL Package Coverage Carrier s Proposal COVERAGE LIMITS - DEDUCTIBLEs SCHOOL LEADERS LEGAL Limit of Liability $1,000,000 - Per Claim $1,000,000 - Aggregate Non-Monetary Relief Defense $100,000 Deductible per claim $5,000 AUTOMOBILE Comprehensive Ded. $500 Collision Ded. $1,000 UMBRELLA Limit of Liability $1,000,000 Self-Insured Retention $0 YOUR Public Schools 2017 to 2018 STATEMENT OF VALUES & LOCATION SCHEDULE LOC. # OCCUPANCY ADDRESS BUILDING BUSINESS PERSONAL PROPERTY PROPERTY IN OPEN BUSINESS INC. & EXTRA EXP HS/MID School 100 North Ave, ANY Town, MN $ 48,000,90 $ 5,099,000 $ 125, Property in the Open $ 180, Grounds Storage - North $ 50,000 $ 19, Grounds Storage - South $ 50,000 $ 15, Consession/Rest Room BLDG $ 66,100 $ 5, Athletic Storage - Track Shed $ 18,000 $ 12, Football Storage - Ticket Booth $ 39,000 $ 19, Bus Garage 1110 South Ave, ANY Town, MN $ 475,000 $ 109, Bus Cold Storage $ 350,000 $ 12, ALC $ - $ 51, Elementry School 170 West Road, ANY Town, MN $ 149,000 $ 31, Property in the Open $ 10, Special Ed. Self Help Ctr. $ 50,900 $ 3, Property in the Open $ 1, Football Press Box Touchdown Street NW, ANY Town, MN $ 90,000 $ Property in the Open $ 555,000 $747,400 TOTAL $49,338,900 $5,376, Blanket Total * $55,463,100 2

3 Annual Review and Assessment Maintain List of new and changing Maintain accurate property values Replacement Values Account for inflation Construction market conditions Gaps in coverage Who provides you this information Appraisal Ask your agent for suggestions and ideas. Annual Review and Assessment Consider Premium Basis Property Values Building Contents Enrollment by grade Teachers Total of employees by classification Foreign Trip Special curriculum (Rifle or Archery Range) Special Education Practices and Programs Auto / Drivers Carrier Specific Supplemental Requests Annual Review and Assessment Appraisals Values at replacement cost Updated every 2-3 years Value of departmental equipment Musical Technology Are your foundations covered Appraisal exclusions? 3

4 Annual Review and Assessment Maintain database of typical carrier required information. Work with your agent to obtain copies of carrier required supplemental information Standard Rating data ( Loss Runs) Type of Construction Location of Fire Department & Water 4 - Basic Liability Policies Educators Legal Liability (School Leaders) General Liability Umbrella/Excess Liability Commercial Auto Liability Common Policy Sections Coverages Exclusions Supplementary Payments Who is Insured Limits Conditions Definitions 4

5 Common / Usual Exclusions Intentional Injury Contractual Work Comp. Employers Liability Pollution War Terrorism Supplementary Payments Cost of defending an indemnitee will not reduce the policy limit. (Defense outside of policy limits?) OTHERS Who is Insured Your District Your Board members, Administrators, employees, volunteers Property Managers? Permissive users of an auto (commercial auto policy) 5

Conditions Section Outlines the responsibilities of both the insured and insurer Reporting of claims If more that one policy applies Law suits filed against the insurer Audits Cancellation

6 Conditions Section Outlines the responsibilities of both the insured and insurer Reporting of claims If more that one policy applies Law suits filed against the insurer Audits Cancellation Provisions, Ect. Liability Insurance Provides protection for: Civil Torts Unintentional Injury to third parties Resulting from negligence Contractual liability Negligence is not required for Medical Payments coverage. Educators Legal Liability Usually written claims made basis What is covered School Board, Directors & officers Employment Practices Educators Errors and omissions Media Liability 6

7 Educators Legal Liability Directors and Officers Losses caused by financial mismanagement Improprieties associated with fund raising Negligent management of endowment funds Antitrust claims Employment practices Wrongful termination Failure to hire Failure to promote Denial of tenure Discrimination Educators Legal Liability Educators errors & omissions Failure to educate Negligent career or academic counseling Wrongful dismissal on academic/disciplinary Discrimination in financial aid grants Sexual Harassment Non-monetary Defense Media Infringement of Copyright Infringement of trademark Plagiarism Libel Umbrella/Excess Liability Connecting it all together Purpose Provides coverage for catastrophic events Umbrella to extend limits of primary liability policies. Excess Replace primary coverage once the primary limits have been exhausted. Unique to Umbrella to afford broader coverage (for some risks) than primary policies provide subject to a retention amount (second deductible). 7

8 Umbrella/Excess Liability Connecting it all together But MN has Tort Caps so why UL/Excess Tort caps do not apply to claims brought outside of the MN court system. Do school representatives travel outside the state? Is it possible you might hire a contractor from out of state? Cases brought under Federal Law? Ways to Cut Cost? Property Valuation Property Deductibles Inland Marine Crime Liability Automobile School Leaders Legal Liability Good Insurance Companies Good Insurance Agent 8

9 Property Valuation Co-insurance taking on more risk 80% 90% 100% Agreed Amount Property Deductibles Taking on Part of Loss $2,500 $5,000 $10,000 $50,000 Flood/Earthquake Inland Marine Why place risk under here Limit Exposure Mobility of asset Change in deductible $250 $500 $1,000 9

10 Crime Drivers of risk Employee Dishonesty Forgery Money & Securities Taking on more risk Casinos $250 and $500 deductible Liability Statutory Caps $1.5M per occurrence Out of State Claims? Deductible Limit Exposure Certificate of Insurance Equal to State Cap or more Automobile Change in deductible $250 $500 $1,000 Glass Coverage? 10

11 School Leaders Legal Liability Limited by State Statute Non-monetary defense Timely reporting Application of Deductible Defense in addition to Liability Limit Umbrella Excess Liability over other lines Satisfy Statutory Compliance Deductible / Retention? Effects of multiple companies And their financial strength Good Insurance Companies Fast Service and Responsive Stable and Solid Rated Loss prevention program Promotes a culture of safety 11

Good Insurance Agent Represents your interest - Trusted Appointed with all the School Carriers Seeks full market competition Strong knowledge of school Culture Environment Challenges Consistent

12 Good Insurance Agent Represents your interest - Trusted Appointed with all the School Carriers Seeks full market competition Strong knowledge of school Culture Environment Challenges Consistent High Level of Service Emerging Risks Drone Liability Builders Risk Cyber/Security International/Travel and accident TULIP Building lease or use by others Opioids Separate limits or sub limits 12

13 Questions & Considerations John Siffert, CSRM Risk Management Consultant, Property and Casualty Marsh & McLennan Agency 7225 Northland Drive North Suite 300 Minneapolis, MN PHONE: Kerry Leider, CSRM Risk Management Consultant, Property and Casualty Marsh & McLennan Agency 1502 London Road Suite 210 Duluth, MN PHONE: This document and any recommendations, analysis or advice provided by representatives of Marsh & McLennan Agency during its presentation are intended solely for the participants of this workshop. Any statements concerning accounting, financial, or legal matters are based solely on our experience as insurance agents or brokers, risk consultants and general subject advisors, and are not to be relied upon as accounting, financial or legal advice for which you should consult your own professional advisors in these areas as circumstances surrounding this subject matter varies. The information contained herein is based on sources we believe reliable, but we make no representation or warrantee as to its accuracy and Marsh & McLennan Agency have no obligation to update these materials, or any liability to you or any other party with regard to these published or presented materials and information. Copyright 2017 Marsh & McLennan Agency LLC 13

Coverage Comparison for USD#489

Coverage Comparison for USD#489 May 11, 2015 This presentation is designed to give you an overview of the insurance coverage we recommend for your company. It is meant only as a general understanding of