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WeGo approves liability and catastrophic auto insurance renewals; liability moves to Obsidian
Summary
The WeGo board approved liability and auto damage/catastrophic insurance renewals June 25; staff recommended moving the liability program to Obsidian Insurance Company with an annual premium of about $1,051,750 and retained a $50 million auto catastrophic policy with a proposed premium of $1,174,008.32.
The WeGo board approved two insurance renewals on June 25: a liability-policy renewal placed with Obsidian Insurance Company and an auto damage/catastrophic coverage renewal that retains a $50 million policy limit.
Vince Malone, presenting on insurance renewals, said the authority's liability program (general liability and auto liability) had been shopped nationally by broker Gallagher. The incumbent carrier Chubb proposed a renewal with a substantial increase; Obsidian (formerly Ohio Insurance Company) provided a lower quote. Staff recommended a one-year liability program with Obsidian with a $3,000,000 policy limit, a $250,000 auto-liability deductible, a $100,000 general-liability deductible and an annual premium of approximately $1,051,750. Malone said the agency performed due diligence on Obsidian's financial ratings (AM Best) before recommending the carrier. The board approved action MA-25-032 to bind the liability coverage.
On auto damage and catastrophic coverage (vehicle-lot/catastrophic events), Malone said the authority maintains a $50 million policy limit; the fleet book value is about $97 million and therefore about $47 million of fleet value is not covered as a typical policy-to-fleet shortfall, but staff said that coverage is consistent with market practice for a fleet with most vehicles in service and that the policy is intended primarily to respond to catastrophic events (floods, large disasters). The proposed premium for the auto damage/catastrophic policy was $1,174,008.32, a small reduction from the prior-year premium (staff cited a premium reduction of about $1,390). Malone said the deductible on the auto damage portion is $100,000. He also said that federal assistance (FTA) could provide disaster support in catastrophic events and that the agency maintains a disaster recovery plan on file with the FTA.
Board members asked whether the lower liability premium with Obsidian affects open claims from a large 2023 accident; staff said claims remaining with Chubb will remain with Chubb and will not transfer to Obsidian; Obsidian will provide coverage for new claims from the renewal effective date (07/01/2025 to 06/30/2026).
Both renewals were approved by the board (MA-25-030 for auto damage/catastrophic renewal and MA-25-032 for liability renewal).
Sources: Presentations by Vince Malone; board discussion and approvals of MA-25-030 and MA-25-032.
