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Council reviews property, liability and cyber insurance renewal as premiums rise
Summary
City staff recommended keeping primary property coverage with Selective amid industry underwriting pressures and proposed switching cyber coverage to a lower‑cost carrier; broker said property insurance reflected a 24% site‑reliability increase and the 'all other perils' deductible will rise to $10,000 effective July 1.
City staff and the city’s insurance broker briefed the Committee of the Whole on June 9 about upcoming property, liability and cyber‑insurance renewals.
Joni, the staff lead on insurance, said the city solicited market options and Mark Whitlock of Summer and Associates recommended keeping the bulk of the property program with Selective Insurance because underwriters are broadly tightening commercial property coverage amid recent loss experience. Whitlock said Selective priced the renewal taking into account a major building fire claim and that result, combined with market forces, yielded a 24% increase in site‑reliability/property insurance premiums.
"We did receive a 24% increase on the site reliability insurance," Whitlock said, and staff also recommended increasing blanket replacement limits five percent to reflect rising construction and reconstruction costs.
On cyber coverage, Whitlock said staff obtained competitive proposals and found about a 25% cost savings by moving that portion of coverage to an alternate carrier. He characterized the cyber‑carrier change as "a lateral move from a coverage standpoint, a deductible standpoint," saying the city would not be giving up material protections under the alternate proposal.
Whitlock also described changes to deductibles: the $25,000 per‑occurrence wind/hail deductible remains unchanged; however, the "all other perils" deductible (which covers fire, vandalism, smoke, frozen pipes and similar per‑occurrence losses) would increase from $5,000 to $10,000 effective July 1.
Staff told the committee the insurance renewal will return on the consent agenda at the next council meeting for formal approval and invited council questions at this session.
Why it matters: The insurance changes affect the city’s financial exposure and near‑term budget planning. Higher property premiums and larger deductibles increase the city’s potential out‑of‑pocket costs after covered losses, while moving cyber coverage could reduce premiums without materially changing coverages, according to staff and broker comments.
What’s next: Staff will bring the complete renewal package to the council’s consent agenda for a formal vote.
