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Urbandale staff recommend insurance renewals, propose raising property deductible to lower premiums
Summary
City staff and broker presented FY25‑26 insurance renewals: recommendation to raise the city’s property deductible from $25,000 to $50,000 to reduce premiums, explanation of wind/hail deductible as 2% of scheduled value, and discussion of rising workers' compensation costs tied to indemnity claims.
Urbandale — City staff and brokers presented the city’s annual insurance renewals June 17, recommending changes to reduce premium pressure and explaining how weather and indemnity claims are driving market increases.
Tim Brunkhorst of World Insurance explained national trends: large catastrophe payouts, more frequent severe weather and reduced reinsurance capacity are increasing premiums for property and liability insurers nationwide. “More claims, more premium is asked for,” he said.
Staff recommendation and rationale: City staff recommended raising the city’s non‑wind property deductible from $25,000 to $50,000 to reduce the pool premium. City staff said the move would save roughly $22,000 on the current renewal and is projected to save about $110,000 over five years. They noted Urbandale’s insurable property value has grown about 60% in the last 10 years, and that wind and hail remain a separate exposure with its own deductible.
Wind deductible detail: Staff said wind/hail damages carry a different deductible: 2% of scheduled value for each affected asset (applied per facility rather than aggregated). As staff explained, a facility valued at about $16 million would carry a 2% deductible of that scheduled value; the library’s scheduled value was cited around $22 million.
Workers’ compensation and 4-11 coverage: Staff reviewed workers’ compensation trends and said recent indemnity claims have pushed rates up. The city’s workers’ compensation pool (IMWCA) rate increased partly because of a series of indemnity claims over the past three years; staff said their experience modification factor had risen to about 1.0 from a lower level previously and that they expect improvements if indemnity claims decrease. Fire and police coverage under Chapter 411 is administered separately (EMC TPA) and staff cautioned that legislative changes expanding presumptions for certain injuries could increase 4-11 costs.
Cyber and other lines: Cyber insurance increases have eased after pandemic-era spikes, staff said, though cyber remains a monitored exposure.
Council action: Council approved the recommended renewals and endorsements (council letter 8188). Staff said they will move forward with the quote acceptance and continue risk‑management efforts to limit future claim costs.
Why it matters: Insurance pricing and deductible structure influence the city’s risk exposure, annual operating costs and reserve needs. Raising deductibles shifts near‑term loss responsibility to the city’s fund in exchange for lower recurring premiums.
