R2018-117 Authorizing Property and Liability Insurance Coverage for the City for the Policy Period Oct. 1, 2018 - Oct. 1, 2019

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City Of Decatur Executive Summary Mr. Gregg Zientara City Treasurer& Director of Finance City of Decatur One Gary K. Anderson Plaza Decatur, IL 62523-1196 RE: October 1, 2018 Insurance Program Renewal Gallagher Global Brokerage is pleased to present your October 1, 2018 Property/Casualty and Workers Compensation renewal. The Property/Casualty marketplace is beginning to show signs of tightness in both the Property and General Liability lines of coverage. From a property standpoint, over the past 18 months carriers have seen a number of catastrophe claims such as floods, forest fires, hurricanes, and mudslides. What this means to us, is that carriers on January 1, 2018 reinsurers treaty costs have increased on average by 15%-20%. This increase to the carriers is being passed on to the insureds regardless of what that individual risk's loss experience has been. In regards to the liability, that coverage is beginning to see slight increases due to increases in law enforcement claims throughout the United States. In addition, many carriers are seeing "MeToo" incidents such as sexual harassment and sexual abuse claims, along with employment practice liability issues being filed as claims. The state of the workers compensation marketplace for public entities continues to be limited. The severity claims continue to rise. This is attributable to a few of the following facts: • Medical cost inflation is expected to rise 6% year over year • Continued lack of light duty return to work programs in place • The opioid epidemic continues to have a negative impact on workers compensation claims In regards to the city's 2018 workers compensation renewal, we approached our incumbent carrier Liberty Mutual. In spite of the city's loss history seeing a slight increase from prior years, our incumbent carrier Liberty Mutual gave us a competitive renewal with a premium decrease. We are recommending to the city that you renew with Liberty Mutual. Our incumbent package carrier, AIX Specialty Insurance Company has given us a competitive renewal in spite of your exposures (property TIV) increasing slightly and the city's history of law enforcement incidents over the past few years. It is our recommendation that we renew with AIX Specialty. In regards to the city's cyber coverage, we did an extensive marketing effort last year. This resulted in the ACE American Insurance Company giving us a competitive renewal. We recommend that we renew with ACE. Due to rising claims activity in this Arthur J.Gallagher Risk Management Services,Inc. 2