Board approves property-insurance approach that trades short-term premium for contingent district exposure

Trustees approved a renewal package for the district’s insurance coverage that will reduce the district’s annual property and casualty premium by roughly $1 million, administration told the board, in exchange for a larger contingent exposure on catastrophic claims.

CFO Dr. Pete Poppe and insurance broker McGriff presented the options; administration recommended “Option 5,” a program that retains a self‑insured share equal to 35% of losses on a claim up to a $25 million event. Under that structure the carrier handles 65% of the claim up to $25 million; the district would be responsible for the 35% share of that $25 million band, producing a maximum cash exposure of $8,750,000 in the event of such a large loss.

Why it matters: The district said its campuses are geographically dispersed, which lowers the probability that a single event would similarly damage many campuses; using that layout and a shared‑risk structure produced a lower premium. Poppe said the property renewal premium would drop from approximately $3.2 million to about $2.19 million under the recommended option.

Administration said the district’s maximum potential outlay on a qualifying declared disaster would likely be reimbursable through FEMA, and staff described a plan to use fund balance as an interim resource pending reimbursement.

Board action: Trustees voted to approve the recommended insurance renewal package. The motion passed without recorded opposition; administration characterized the approach as a calculated tradeoff between lower recurring premium costs and higher contingent liability tied to major disasters.

Ending: Administration said it will finalize policy language with the broker, continue the TASB bundle for other coverages, and present any final contract documents to the board as required.