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HomeMy WebLinkAboutRES 76 16R E S O L U T I O N BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF BEAUMONT: THAT the City Manager be, and he is hereby, authorized to retain the Wyatt Company to do an insurance and risk manage- ment study for the City of Beaumont pursuant to the proposal of the Wyatt Company attached hereto as "Exhibit A". PASSED BY THE CITY COUNCIL of the City of Beaumont this the j 34-A day of m 1976. - Mayor - BOSTON CHIC AI&I CLEVELAND DALLAS DETROIT FORT WORTH HONOLULU HOUSTON -� LOS ANGELES MIAMI C X 1-1 1 ra I�+ THE (�Gf,(, COMPANY ACTUARIES -EMPLOYEE BENEFIT CONSULTANTS -RISK MANAGEMENT CONSULTANTS INTERNATIONAL BENEFITS -EMPLOYEE COMMUNICATIONS 1900 REPUBLIC NATIONAL BANK TOWER DALLAS, TEXAS 75201 I Mr. Kenneth Wall`," 'Jr . City Attorney City of Beaumont P. 0. Box 3827 Beaumont, Texas 77704 Dear Mr. Wall: (214) 748-5867 December 4, 1975 Proposal for Work in Connection with Group Life and Health Insurance Benefits Covering Employees of the City of Beaumont MINNEAPOLIS - ST. PAUL NEW YORK ORLANDO PHILADELPHIA SAN FRANCISCO WASHINGTON MONTREAL OTTAWA TORONTO This letter will confirm in writing the discussion that I gave in your office on Wednesday, November 26, 1975, concerning some work in connection with life and health benefits covering the Beaumont city employees.. Outline of Work to be Accomplished Upon authorization to commence work, we would forward to you some blank forms that would, in turn, be submitted to the present carrier for the assembling of financial data for the present benefits. At the time the financial data is being assembled from the present carrier, an inquiry would be made of the carrier to ensure that if any reserves are still retained by the present carrier that after a new carrier is selected these reserves would be refunded to the City. This particular item should have been covered several years ago at the time that the present case was awarded. In any event, the commitment of the present carrier should be confirmed to refund any unused funds. While this financial data is being summarized by the present carrier, there would be opportunity for your staff to make copies of existing contracts, financial reports, and other information for forwarding to us. Upon receipt of all this financial data and information, we would commence Step One. 2 - Step One involves the preparation of specifications for insurance companies to bid on the life and health benefits. Work in preparing the spe- cifications would be primarily in two areas: (1) the upgrading and realigning benefit levels to meet current needs and (2) crystallizing the approach to the financial arrangement that the City desires to enter into with a life insur- ance company. This financial arrangement involves guaranteed premiums, retention levels, and reserve levels that would be desired for the insurance. carrier to establish. Upon finalizing the specifications, life insurance companies would be asked to bid. Upon receipt of the bids from the life insurance companies, the second step in the work is commenced. Under Step Two, The Wyatt Company would analyze the bids and prepare a written report. In the written report the essentials of the bids would be summarized and two or three carriers would be recommended as the carrier for the life insurance contracts. The written report would be presented in Beaumont to interested par- ties, including members of the City Council, if desired. Upon the selection of a carrier, which may be the present carrier, or a new carrier, the carrier would then be directed to prepare a contract in connection with the life and health benefits. At this point of the project, a third step is undertaken. With Step Three, we would offer assistance in a smooth transition from the present arrangement to a new arrangement and also review the insur- ance contract and retention agreement to determine that the provisions thereof are in compliance with the bid submitted by the carrier and accepted by the City. Fees for Work The fees for our work is based upon the number of hours that we spend on a project and the hourly rate of pay for the personnel involved. The aver- age hourly rate for most of the assignments ranges from $30 to $40 per hour. On the basis of other assignments completed, we would estimate that the range of fee for this project would be from $3,000 to $5,000. This fee is given on the assumption that no more than 15 bids would be analyzed to complete the project. If more than 15 bids are analyzed, there may be a proportional in- crease in the amount of the fee. On the basis that the number of bids received will not exceed 15, we are willing to place a maximum fee on this project for budgeting purposes of $5,000. Y 3 - If you have any questions, please do not hesitate to call. Sincerely, TH'E WYATT COMPANY l l � 41 y11L?�r ckett, Actuary Z 'Fell& yl the Society of Actuaries J ag Enclosures P. S. For your additional information, Xerox copies of other assignments are enclosed for your.review. Mr. Kenneth E. Wall, Jr. City Attorney P. 0. Box 3827 Beaumont, Texas 77704 Dear Mr. Wall: In line with our discussion of November 26th, I'm writing to confirm the scope of work involved in undertaking a review of the complete general insurance and -risk management program of the City of Beaumont. Jerry Brockett is writing a separate letter describing 1,Tyatt's group insurance services. The objective of the risk management review will be to provide an - independent and unbiased report to the city management of the adequacy, compre- hensiveness and appropriateness of the insurance program now if force, and to make recommendations as to those modifications of that program that would ap- pear to be in the interest of the city at this time or in the immediate future. This study would include the following factors: 1. Identification of the exposures of the city to insurable types of loss. 2. Determination of the most appropriate and least costly method of handling each exposure -- i.e., commercial insurance, self-insurance, hold harmless agreements, etc. 3. Review of the insurance and risk management philosophy, of the city, and development of recommendations relative to that philosophy. 4. Analysis of the existing contractors of insurance and evaluation of the adequacy and comprehensiveness of protection afforded by them. , 5. Determination of the advisability of any modification of the present insurance program of the city -including such matters as: a. Changes to or from self-insurance b. Purchase of additional insurance c. Changes in deductible levels d. Changes in rating plans BOSTON. MINNEAPOLIS- CHICAGC, ST. PAUL CLEVELAND NEW YORK • DALLAS - ORLANDO DETROIT ///y / COMPANY PHILADELPHIA FORT WORTH SAN FRANCISCO 1 HONOLULU WASHINGTON HOUSTON ACTUARIES -EMPLOYEE BENEFIT CONSULTANTS -RISK MANAGEMENT CONSULTANTS LOS ANGELES INTERNATIONAL BENEFITS -EMPLOYEE COMMUNICATIONS MONTREAL MIAMI OTTAWA 1900 REPUBLIC NATIONAL BANK TOWER TORONTO DALLAS, TEXAS 75201 (214) 748-5867 December 4, 1975 Mr. Kenneth E. Wall, Jr. City Attorney P. 0. Box 3827 Beaumont, Texas 77704 Dear Mr. Wall: In line with our discussion of November 26th, I'm writing to confirm the scope of work involved in undertaking a review of the complete general insurance and -risk management program of the City of Beaumont. Jerry Brockett is writing a separate letter describing 1,Tyatt's group insurance services. The objective of the risk management review will be to provide an - independent and unbiased report to the city management of the adequacy, compre- hensiveness and appropriateness of the insurance program now if force, and to make recommendations as to those modifications of that program that would ap- pear to be in the interest of the city at this time or in the immediate future. This study would include the following factors: 1. Identification of the exposures of the city to insurable types of loss. 2. Determination of the most appropriate and least costly method of handling each exposure -- i.e., commercial insurance, self-insurance, hold harmless agreements, etc. 3. Review of the insurance and risk management philosophy, of the city, and development of recommendations relative to that philosophy. 4. Analysis of the existing contractors of insurance and evaluation of the adequacy and comprehensiveness of protection afforded by them. , 5. Determination of the advisability of any modification of the present insurance program of the city -including such matters as: a. Changes to or from self-insurance b. Purchase of additional insurance c. Changes in deductible levels d. Changes in rating plans - 2 - e. Elimination of unnecessary coverages f. Consolidation of coverages g. Amendment of policy terms and conditions h. Reconsideration of systems of valuation i. Changes in practices regarding insurance requirements from lessees, suppliers, or contractors j. Recommendations regarding the most efficient course to follow in the purchase of insurance. In undertaking this assignment, our activities will,include visits to key facilities as approved by you to'obtain data on the city's operations, exposures and insurance policies and appropriate conferences with key personnel as the process of conducting this study takes place. To undertake this assignment, we will need copies pf all existing insurance policies relating to coverages within the scope of the study. We also will require copies of rate calculations, premium audits, loss statistics and inspection reports, which may be in your files or readily av4ilable from your insurance agents or companies. Copies of lease agreements, appraisals or other property valuation data, contractual agreements anti other background data will also be most helpful. The Wyatt Company is known for the quality of its work, a reputation developed by assignment to each client's needs of capable and experienced persons in the respective disciplines required. The likely project team in- volved in this proposed assignment would be headed by: Frederick B. Gillette Warren G. Brockmeier Project Manager Associate Project Manager Additional staff members would be assigned as required. Other governmental clients of The.Wyatt Company include the following: 1. City of Chicago 2. State of Wisconsin 3. Energy Research and Development Authority (Formerly the Atomic Energy Commission) 4. Maricopa County, Arizona 5. Cook County, Illinois In the conduct of any assignment we will act solely in a consulting and advisory capacity. We do not act as insurance agents and will not receive any commissions in connection with your insurance or remunerations from any source other than the fee charged to you for our professional services. Our by either party upon 30 days' notice. Once a complete review hasbeen accomplished, a retainer agreement would be available to the city at a flat monthly cost of $300. We are pleased to submit this proposal, and look forward to the opportunity to be of service. Sincerely, A T COMPANY it te, CPCU nt n ement Services FBG: dem