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Tuscaloosa committee approves renewal of city's $2.39 million insurance policy amid higher property values
Summary
The Litigation & Insurance Committee approved renewal of the city's primary property, fleet and general-liability policy. Staff said the premium rose from $1.95 million to $2.39 million—an increase of about $457,581—largely because of higher property valuations and rate increases.
The Tuscaloosa City Litigation & Insurance Committee on an unnamed date approved renewal of the city's primary insurance policy covering fleet, buildings and general liability after staff said the annual premium rose about $457,581.
Hudson Cheshire, identified in the meeting as the staff lead on the policy review, told the committee last year's premium was $1,950,000 and "this year, it is $2.39" million. He said the net increase is $457,581 and listed three main contributors: a routine 3% inflationary adjustment to the property schedule, $28,400,000 in added city property over the past year and a higher rate factor applied across commercial property and casualty coverage. "The metric for gauging the premium last year was 13¢ per $100. This year, it's gone up to 16¢ per $100," Cheshire said.
Cheshire said the adjustment is within the department's insurance budget overseen by Carly and that staff across departments and risk-management personnel reviewed the property and fleet schedules to confirm values. He told the committee the renewal reflects work by multiple departments and the Office of City Attorney's risk team.
Rick, a city staff member who described post-disaster inventory work and coverage choices, said staff reduced contents values at the Gateway facility from about $2,000,000 to about $250,000 after a joint review. He also described the city's approach to auto coverage: generally removing collision from vehicles older than five years unless a department requests full coverage. "We reduced that down from about $2,000,000, I think, to $250,000 in material and things that you had in there," Rick said.
A motion to approve the policy renewal was made by an unnamed committee member and seconded by Michael Marsh; the committee approved the resolution by voice vote.
The committee recorded staff explanations of why the premium rose but did not alter coverage limits during the meeting. The committee chair said the committee will likely not meet again for several months.
