Meeting_Body
FINANCE, BUDGET AND AUDIT COMMITTEE
FEBRUARY 20, 2025
Subject
SUBJECT: RISK MANAGEMENT INSURANCE BROKERAGE SERVICES
Action
ACTION: APPROVE CONTRACT AWARD
Heading
RECOMMENDATION
Title
AUTHORIZE the Chief Executive Officer to award a firm fixed price Contract No. PS126876000 to Marsh USA LLC for insurance brokerage services in the amount of $1,503,513 for the five-year base term, and $601,405 for each of the two, two-year options, for a total amount of $2,706,323, effective March 1, 2025, subject to the resolution of any properly submitted protest(s), if any.
Issue
ISSUE
Metro's current insurance brokerage services contract will expire on May 31, 2025, and the new contract, if approved by the Board, will start on March 1, 2025. This ensures a smooth transition, avoids disruption, and allows the new broker time to onboard.
Background
BACKGROUND
An insurance broker of record is required for Metro to purchase insurance from commercial markets. Insurance is necessary because it covers risks such as potentially catastrophic property and liability damages that are better managed through commercial insurance. Additionally, many Metro contracts and other agreements require commercial insurance coverage.
Discussion
DISCUSSION
Metro uses a licensed broker to purchase insurance for its non-construction exposures. The broker markets the excess liability insurance program, currently with $300 million in limits and an $8 million self-insured retention for rail exposures, and up to $12.5 million self-insured retention for bus and other related exposures. In addition, the broker will market the program of all risk property and flood coverage. The current property program has $650 million in limits with a $1 million deductible. Further, Metro established a program of cyber liability insurance with limits of $50 million with a $10 million retention. Metro has considered and may direct the broker to market additional coverage including pollution l...
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