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Dalton board approves insurance renewal, accepts higher deductible for lower premium
Summary
Trustees approved an insurance renewal package that reduces the villagepremium but raises the self-insured retention (deductible) to $500,000; broker Cliff Taylor recommended Option 2 as a cost savings measure.
The Village of Dalton voted Aug. 4 to approve an insurance renewal recommended by broker Cliff Taylor that reduces annual premium costs in exchange for a higher self-insured retention (SIR).
Taylor told trustees the renewal would lower the village's premium from a recent level near $2.1 million to roughly $1.5 million under the proposed Option 2, producing about $600,000 in annual premium savings. Option 2 increases the villageSIR to $500,000; Taylor and the board noted the SIR functions like a deductible and applies per claim.
Trustee Stan Brown moved to approve the coverage package; Trustee Andrew Holmes seconded. The board approved the motion by roll call. Mayor and staff said the savings help the village reduce operating costs but emphasized the financial exposure created by a larger SIR, which requires the village to pay defense and settlement costs up to the retention per claim before excess coverage applies.
Taylor and trustees discussed that Cook County municipal insurance markets have been volatile, with carriers leaving the market and coverage limits shifting in recent years. The policy presented increased limits for several lines to $5 million compared with a lower coverage level in recent years; the broker also offered an option for additional excess coverage at added cost.
Trustee discussion also referenced the village's high litigation load from prior years and the effect of multiple open cases on premium and retention dynamics. Attorney Michael McGrath stated that reducing the number of active claims will help future insurance pricing and reduce the amount of municipal funds expended under the SIR.
The board recorded the vote and directed staff and counsel to monitor claims and insurance performance. No additional insurance purchases were authorized at the meeting.
