7f Supp
Item No.: 7f_supp Meeting Date: September 8, 2015 Liability Insurance Renewal Update 2015-2016 Renewal Coverage Process Coverage will run 10/1/2015 to 9/30/2016 Risk Management department compares coverage terms and costs with other port and airport entities to validate the coverage we are selecting and to ensure we leave no gaps in coverage. Quotes on coverage are reviewed and final costs are discussed with Division Finance and Budget Bind coverage on September 30, 2015 The Port uses a licensed broker to access insurance markets to obtain quotes on coverage which Risk Management then reviews during the renewal process. Several policies are placed in London. Port's Liability Insurance Coverage Coverage Description of Exposure Covered Law Enforcement Police operations Public Officials Wrongful acts of Port employees Employment Practices Wrongful acts of Port with respect to employees Non-Aviation Non-aviation operations (marine, cruise) Aviation Airport operations only Auto Automobile liability (Above what is selfinsured or $ 1 Million per claim) In 2014, Risk Management handled 116 auto claims; liability costs were $23,000 and physical damage costs were $80,000. Port's Liability Insurance Coverage Coverage Description of Exposure Covered Fiduciary Liability of managing employee benefit plans Foreign Port employees who are in foreign countries Crime Dishonest acts of Port employees Vessel Police boat and other Port vessels Bonds Self-insured pension bonds, notary bonds, custom bonds, etc. Excess Workers Compensation Not purchasing The Port has not purchased excess workers compensation in recent years due to cost. Insurance Premium Factors Insurance markets Strength of Port indemnity agreements/leases Amount of Port's deductible Limits requested Special coverage requests Number of open claims and litigation Reserves on claims and litigation Port reserves at the end of second quarter totaled $3.2 Million, down from $3.5 Million in Q1. Expiring Premium: 2014-2015 Coverage Line Limits Deductible Expiring Premium 10/1/2014 -9/30/2015 Non-Aviation $50 Million $1,000,000 $460,000 Airport $300 Million $50,000 $282,000 Police $10 Million $1,000,000 Included in Non-Aviation Auto Self Insured First Million Self-Insured No Premium Self insured Vessels $ 1 Million $5,000 $21,000 Public Officials $10 Million $1,000,000 Included in Non-Aviation Employment Practices Cyber $5 Million Varies - $50,000 $48,000 Other Coverage: Crime, Varies Varies $38,000 Fiduciary, Foreign, Bonds Total = $849,000 The Port added cyber coverage on 12/1/2014 last year's renewal saw no major increases. $700,000,000 $1,400,000 Liability Insurance Premium Versus Total Revenue 2005 to 2016 Est $600,000,000 $1,200,000 $500,000,000 Liability Premium $1,000,000 Port Revenue $400,000,000 $800,000 $300,000,000 $600,000 $200,000,000 $400,000 $100,000,000 $200,000 $- $- 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 Est The Port's increase in the cost of liability insurance is tracking with revenue growth. Liability Coverage Issues For 2015-2016 (To Be Finalized In Discussion With Divisions prior to 10/1/2015) Terrorism The TRIA Act was reauthorized in 2015 (Terrorism Risk and Insurance Act) Continue to purchase for non-aviation liability policies but looking at stand-alone coverage Airport Liability Limits Staying at $500 Million Public Entity General Liability Initial quote from insurer is a 22% increase in premium Increase due to reserves on litigation claims the insurance company is carrying First premium increase since October 1, 2013. Marine Excess Liability Limits Staying at $50 Million Adding the Northwest Seaport Alliance as an additional insured onto this policy Excess Worker Compensation Not pursuing Cyber Liability Coverage Added as new coverage on 12/1/2014 Will renew on October 1, 2015 with $5 Million in limits The Port's increase in the cost of public entity liability insurance is 22% or ~ $75,000. Renewal Estimate For 2015-2016 (To Be Finalized In Discussion With Divisions prior to 10/1/2015) Renewal Estimate ~ $940,000 to $960,000 Overall total insurance costs for 2015 will be at or slightly less than budget. Through end of July, insurance costs are roughly $72,000 below budget year to date. The Port's favorable property insurance renewal on July 1, 2015 will offset most of the increase to the liability insurance.
Limitations of Translatable Documents
PDF files are created with text and images are placed at an exact position on a page of a fixed size.
Web pages are fluid in nature, and the exact positioning of PDF text creates presentation problems.
PDFs that are full page graphics, or scanned pages are generally unable to be made accessible, In these cases, viewing whatever plain text could be extracted is the only alternative.