R2019-144 Resolution Authorizing Property and Liability Insurance Coverage for the City of Decatur, Illinois for the Policy Period October 1, 2019 to October 1, 2020

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City Qf Decatur � Gallagher ��X,�+C�RE 3�Q. 9.., �§'" !, ``.;r; ' " ",� _.�. . .., <_ _ �4 x. ... �- . . . � ,..., Arthur J.Gallagher Risk Management Services,Inc.appreciates the opportunity to present this proposal far your cansideration. Mr. Gregg Zientara Ci#y Treasurer&Director of Finance City of pecatur One Gary K.Anderson Plaza Decatur, 1�62523-1196 RE:October 1,2Q79 insurance Program Renewai Dear Gregg, Gailagher Globai Brokerage is pleased to present your October 1, 2019 Insurance Pragram Renewal for your Property/Casualty and Workers"Compensation renewals. The state of the insurance marketplace continues ta show characteristics of a hardening market after nearly 10 years of snft market cycles. In particular,the Midwest property market is changing daily due to the catastraphic claims of flaods,tarnadoes, and severe canvective storms that bring strong winds and large devastating hai1. The property reinsurance marketplace has continued to#ighten their underwriting guidelines, as storm modeling is making the Midwest less profitabEe.These macro-economic developments are resulting in significant coverage and pricing changes being passed on to policy halders. Since January 1, 2019 every property risk in the Midwest will see a change in caverage and rate. Profitable risks with little claims ar catastrophic claim activity have seen property rate increases exceeding 1p°fo.Thase risks with poor loss history ar are located in high hazard CAT madeling zones are seeing properky rates increase 100%or more and deductibles and SE�F Insured Retentions are being raised. In regards ta the Casualty marketplace,#hat is also showing signs af hardening.Many insurers far Municipalities have heightened concems of sexual abuse/molestation, sexual harassment in the workplace,excessive force/shootings in law enforcement,and empioyment practice liability claims.These factars have caused insurers#o look ciosely at each individual risk and make necessary adjustments in limits and deductibles. The State of iilinois Warlcars'Compensation marketplace con#inues to evolve.A few af the factors that are changing the Illinois Wori�ers'Campensation�andscape are as follows: • The 2018 Electians will have a huge impact.We elected a new Governor which means there will be new regulators and new Gommission members which could change#he Warkers'Compensation practice in Illinois. • Use of opiaids continues to rise. Empinyers and insurerslclaims personal are addressing the issue by inteoducing pain phitasaphy into their programs.Same insurers are crea#ing various pain assessment tools and incarporating these inta their claim handling procedures for injured employees. • Use of Medical Marijuana in treatment pians is increasing, In regards to the City's 2019 Worker's Compensation renewal,we appraached our incumbent carrier Liberty Mutual. In spite of the City seeing develapment in claims for prior years, Liberky gave us competitive renewal terms.We are recommending the City renew with Liberty Mutual. When we began#he renewal process,we requested a meeting with our Package carrier,AIX Specialty Insurance Company.The purpose of the meeting was to review with the underwriter, the City's exposures and loss history over the past five years.The gaal of the meeting was to get a commitment of a competitive renewai from the carrier, in spite of the City's law enfprcement claims over the years—if we received that commitment from the carrier,we would make a commitment ta them to not shop them.We are pleased to report that our carrier gave us a relatively flat renewal. It is our recommendation that we renew wiih AIX Speciaity. �� y', „ ,r9,.5 "'t`%k � 3 ,.w��. -,,�: a .�a�r.': =e�w u :.�. ,��kt%r: 2�F.: �' ��y .._.,.�+�* T.;�'"�