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CONSIDERATION OF AUTHORIZATION FOR THE PURCHASE OF BUILDINGS AND CONTENTS INSURANCE FOR THE CITY OF NORMAN FROM AFFILIATED FM IN THE AMOUNT OF $127,359 FOR THE PERIOD OF DECEMBER 1, 2016, TO OCTOBER 1, 2017 AND BUDGET TRANSFER.
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BACKGROUND: The City of Norman self-insures against most risks (i.e., workers compensation, vehicle/equipment damage, employee health benefit claims, tort claims, etc.) but historically has purchased insurance to cover casualty losses to City buildings and contents (including electronic information technology/computer equipment). This insurance is purchased in a blanket amount but is limited to agreed-upon values of independent buildings and contents, and is subject to a deductible.
In the past, the City of Norman bid out its buildings and contents insurance. However, several brokers expressed their frustration with this method as insurance underwriters will only work with the first insurance broker that contacts them and the incumbent broker had already left "place markers" with most of the underwriters. In 2014 the City decided to pick a broker via a Request for Proposal process that would then bid and select the best buildings and contents insurance for the City. This is the method other cities in the metro use to select insurance products including the City of Oklahoma City.
The City of Norman sent out Request for Proposal RFP-1314-49 on February 26, 2014, for insurance broker services. One broker responded, Arthur J. Gallagher & Co. (Gallagher). Gallagher is the incumbent broker the City has used for several years and has provided quality bids and rates in the past. Management has been pleased with their services.
DISCUSSION: The particular area that includes Oklahoma has experienced very costly storms in recent years to insurance companies. The City's incumbent underwriter did not want to renew its policy for the upcoming year without significant changes to deductibles. The current policy was scheduled ...
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