HomeMy WebLinkAboutItem 3d: Agreement with Carl Warren & Company: General and Auto Liability Claims 76v ARc
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STAFF REPORT
Administrative Services Department
DATE: June 19, 2012
TO: Honorable Mayor and City Council
FROM: Hue C. Quach, Administrative Services Director
Michael A. Casalou, Human Resources Administrato
SUBJECT: AUTHORIZE THE CALIFORNIA INSURANCE POOL AUTHORITY (CIPA)
TO ENTER INTO A THREE-YEAR AGREEMENT WITH CARL WARREN
& COMPANY ON BEHALF OF THE CITY OF ARCADIA FOR THIRD
PARTY ADMINISTRATOR SERVICES FOR GENERAL AND AUTO
LIABILITY CLAIMS IN THE AMOUNT OF $19,800 FOR FISCAL YEAR
2012-13 AND $20,390 ANNUALLY FOR FY 2013-14 & 2014-15.
Recommendation: Approve
SUMMARY
It is recommended the City Council authorize the California Insurance Pool Authority
(CIPA) to enter into a contract with Carl Warren & Company on behalf of the City of
Arcadia for Third Party Administrator Services for General and Auto Liability Claims
Administration in the amount of $19,800 for Fiscal Year 2012-13 and $20,390 annually
for FY 2013-14 & 2014-15.
BACKGROUND
The City of Arcadia operates a self-funded general and auto liability insurance program
and requires the services of a third party administrator (TPA) to handle the day-to-day
operations of the City's claims. Carl Warren & Company has administered the City's
program since July 1, 2011.
The scope of services for the liability program may include processing and tracking
claim information, setting and updating reserves, arranging for investigations and
providing reports, providing clear and concise narratives, documenting all actions taken
on claims, providing litigation management, and providing appropriate notices.
Additionally, a TPA will ensure the City maintains compliance with liability best practices
and laws. In-house staff does not have the capacity or the expertise to properly
manage this program. As a result, the City has always contracted for this specialized
service.
Authorize the California Insurance Pool Authority (CIPA) to enter into a three-year
agreement with Carl Warren & Company on behalf of the City of Arcadia
June 19, 2012
Page 2 of 2
DISCUSSION
The City's current JPA for workers compensation and liability (CIPA) went out to bid for
general and auto liability claims administration services on behalf of eight (8) member
cities in July 2009. An agreement was reached with Carl Warren & Company that runs
through June 30, 2012. In May 2011, the City Council authorized CIPA to add the City
of Arcadia to that agreement via an addendum. The current CIPA contract with Carl
Warren & Company runs through June 30, 2012.
The CIPA General Manager was successful in renegotiating a new three-year
agreement with no increase in the first year (a one-time $150 annual administrative fee
that was waived this past year is included in first year fee), a modest 3% increase in the
second year, and no increase in the third year. Given Carl Warren & Company have
performed satisfactorily this past year, it is recommended that the City Council authorize
CIPA to include the City of Arcadia in the new three-year agreement with Carl Warren &
Company.
FISCAL IMPACT
The annual cost of $19,800 for general and auto liability claims administration is
included in the Fiscal Year 2012-13 Budget. The cost of the second and third year of
this agreement will be $20,390 annually.
RECOMMENDATION
It is recommended that the City Council authorize the California Insurance Pool
Authority (CIPA) to enter into a three-year agreement with Carl Warren & Company on
behalf of the City of Arcadia for Third Party Administrator Services for General and Auto
Liability Claims in the amount of $19,800 for Fiscal Year 2012-13 and $20,390 annually
for FY 2013-14 & 2014-15.
APPROVED:
Dominic Lazza o
City Manager