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Insurance broker reviews city coverage and premium changes
Summary
Marcus Pitts of Brown & Brown briefed the council on the city's CIS liability and property coverages, noting $10 million per-occurrence liability limits, a $120 million property schedule, a premium decrease on the CIS policy to $411,000, flat cyber premiums, and higher workers' compensation costs driven by police-related claims and a slight rise in the experience rating.
Marcus Pitts, vice president of the public sector team at Brown & Brown, told the Cottage Grove City Council the city participates in the state-specific City County Insurance Services (CIS) pool and that the pool provides robust liability limits: $10,000,000 per occurrence and $30,000,000 aggregate annually.
Pitts said the city has a blanket property schedule covering roughly $120,000,000 of property and noted the CIS premium for property and liability totaled about $411,000 this year, down from $436,000 the previous year. He identified two drivers of the premium decrease: lower law-enforcement exposure and a drop in the city's budgeted services used as an exposure basis.
Cyber coverage remained flat at $10,700 this year, Pitts said. By contrast, workers' compensation premiums increased, largely because of claims trends; police officer rates rose across the state and the city's experience-rating factor moved from about 0.91 last year to about 1.03 this year, reversing a modest discount and creating a small net premium increase for the city.
In response to council questions about whether premiums are based on budgeted or filled positions, Pitts said the annual application is completed using the number of budgeted full-time positions the city expects to have; vacancies that are not expected to be filled for the year are typically excluded from the submission.
Pitts also reminded council members that board and council service is covered by CIS when members act within the course and scope of their official duties but cautioned that ethics complaints have limited defense-cost coverage: $25,000 per individual and $50,000 total for council ethics defense costs specifically. He said if a member is found liable in an ethics matter those defense costs would not be reimbursed under the policy.
What comes next: staff indicated they can provide more precise payroll and staffing numbers for council review if members want to reconcile budgeted versus filled positions for premium calculations.
