TITLE
Recommendation to authorize City Manager, or designee, to purchase “all risk” property insurance for City buildings, Queen Mary contents, and vehicles, through the Alliant Insurance Services’ Property Insurance Program (APIP), for a total premium not to exceed $1,966,374, and Earthquake (Difference in Conditions Coverage), at a premium of $160,336, with Insurance Company of The West, for the period of July 1, 2019 to July 1, 2020. (Citywide)
DISCUSSION
The Human Resources Department requests City Council authorization to renew “all risk” property insurance and earthquake insurance coverage.
Property Insurance
Through its property insurance broker, Alliant Insurance Services, the City annually purchases “all risk” property insurance to cover perils such as fire, vandalism, and wind damage to City buildings, contents, and vehicles. This insurance provides coverage for all risks, subject to exclusions and limitations. The proposed property insurance policy provides replacement cost coverage with limits of up to $1 billion, subject to a $50,000 per occurrence deductible, and a limit of $10 million in coverage for flood. The deductible will vary depending on the nature of the property insured. The policy also provides some limited cyber liability, boiler and machinery, and pollution coverage.
The property insurance premium includes coverage for the Queen Mary, which will be paid by Urban Commons, the lessee. The premium for the primary layer of coverage on the Queen Mary, as required by the master lease, is approximately $125,000. In addition, the premium for several excess layers of coverage is estimated at $669,402. The total property insurance premium for the Queen Mary is approximately $794,402.
The City property insurance premium (excluding Queen Mary coverage) will not exceed $1,171,972. The new premium represents an increase of approximately 36 percent from the prior premium, due to an increase in the value of City property, inflation, and two ...
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