Meeting_Body
FINANCE, BUDGET AND AUDIT COMMITTEE
JANUARY 15, 2020
Subject
SUBJECT: RISK MANAGEMENT INSURANCE BROKERAGE SERVICES
Action
ACTION: APPROVE CONTRACT AWARD
Heading
RECOMMENDATION
Title
AUTHORIZE the Chief Executive Officer to award a five-year, firm fixed price Contract No. PS63853000 to USI Insurance Services LLC in the amount of $1,268,600 for a five-year base term, $530,503 for the first 2-year option, and $562,811 for the second 2-year option, for a combined total amount of $2,361,914, effective June 1, 2020 subject to resolution of protest(s), if any.
Issue
ISSUE
Metro's current brokerage services contract with USI Insurance Services LLC ("USI"), expires on May 31, 2020.
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 of our 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 Metro's excess liability insurance ($300 million in limits with $8 million self-insured retention), all risk property and flood coverage, ($400 million in limits, no earthquake and varying deductibles), drone insurance, and railroad liability insurance ($60 million in limits currently which is adjusted every three years based on Consumer Price Index). The broker has also handled major insurance project specific umbrella insurance (up to $300 million historically) as well other coverages such as pollution legal liability, owner's protective, fraud and fidelity, and public official's directors and officers. Currently, Metro's total excess liability and property insurance premiums are about $9.1 million per year.
In addition to handling required marketing an...
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