Watertown insurance premiums rise 13%; council asks staff to seek bids for next cycle

Watertown officials authorized payment for the city's liability, property and other insurance renewals on Aug. 18 after staff reported a 13% increase in premiums. Finance Officer Kristin Bobzine told the council the increase reflected several factors: the addition of equipment and buildings to coverage, a 7.5% increase in insured values to reflect market inflation and the loss of a loss‑ratio credit because of hail and other claims in 2024. The net effect will be an increase in annual premiums of about $101,000 compared with last year. Council direction and procurement questions Council members asked how long the city has been with the South Dakota Public Assurance Alliance and whether staff had recently shopped the insurance externally. Bobzine said the city has used the Alliance for many years and that staff could undertake a request for proposals for future cycles; she noted in past experience it can be difficult to attract bidders for municipal insurance packages. The council approved the insurance renewals and authorized the chief financial officer to issue a special check to pay the premiums. Several council members asked staff to begin a bid/RFP process in the next renewal cycle so the council can evaluate alternatives. Discussion vs. decision Discussion only: drivers of premium increase, history with current insurer, and feasibility of soliciting bids. Decision: approval of insurance renewals and authorization to pay premiums now; direction to staff to explore competitive proposals for the next cycle.