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HomeMy WebLinkAbout04. 20-453 NOVEMBER 24, 2020 20-453 RESOLUTION (CARRIED 7-0 LOST LAID OVER WITHDRAWN ) PURPOSE: APPROVE AGREEMENT FOR WORKERS COMPENSATION THIRD PARTY ADMINISTRATOR & SPECIFIC EXCESS WORKERS COMPENSATION & EMPLOYER LIABILITY WITH LEAGUE OF WISCONSIN MUNICIPALITIES MUTUAL INSURANCE INITIATED BY: CITY ADMINISTRATION BE IT RESOLVED by the Common Council of the City of Oshkosh that the proper City officials are hereby authorized to enter into and take those steps necessary to implement an appropriate agreement with League of Wisconsin Municipalities Mutual Insurance for performing Workers Compensation Third Party Administration and for providing Specific Excess Workers Compensation & Employer Liability Insurance. BE IT FURTHER RESOLVED that money for this purpose is hereby appropriated from: Acct. No. 603-0909-6481-00000 Workers Compensation Fixed Charges TO: Mayor and Members of the Common Council FROM: Paul Greeninger, Safety & Risk Management Officer DATE: November 17, 2020 RE: Approve League of Wisconsin Municipalities Mutual Insurance (LWMMI), as third party administrator, specific excess workers compensation, and employer liability carrier BACKGROUND The City of Oshkosh Workers Compensation Program is partially self -funded, and currently uses Minutemen HR Management of Wisconsin as our third party administrator (TPA). The City pays every dollar of a claim, up to $500,000. For claims in excess of $500,000, the City has specific excess (stop loss) workers compensation and employee liability coverage through Safety National Casualty Corporation. The City was made aware that Safety National would be providing renewal rates that would raise the excess limit to $750,000 for any Police or Fire workers compensation claims. ANALYSIS The City has had a business relationship with LWMMI for some time, as they provide our general liability insurance. In consideration of this, we asked LWMMI to develop an alternate proposal for the aforementioned TPA, stop loss and employee liability insurance. The proposal was reviewed, and in comparison to our existing relationship, LWMMI's proposal would provide cost savings, as well as additional benefits. These benefits include: A $250,000 excess limit for all employees; Nurse Case Managers, Physicians and Legal Counsel which can help contain costs of claims; On site job safety analysis; On-line safety training and webinars, and finally, LWMMI will include the premium paid for the workers compensation when they calculate dividends at the end of the year, as well as offer a Safety Grant that will match 75% of costs for the purchase of safety equipment. City Hall, 215 Church Avenue P.O. Box 1130 Oshkosh, WI 54903-1130 920.236.5000 htip://w .ci.oshkosh wi.us FISCAL IMPACT The total cost, using Minutemen HR Management of Wisconsin and Safety National Casualty Corporation is projected to be $184,800. The initial proposal received from LWMMI is $160,602. Making this switch would equates to a savings of $24,198. RECOMMENDATION Staff recommends approval of the resolution. Respectfully Submitted, Paul Green Safety & Risk Management Officer Approved: � 7z� Mark A. Rohloff City Manager CC: Michelle Behnke, HR Manager John Fitzpatrick, Assistant City Manager / Director of Administrative Services LEAGUE OF WISCONSIN MUNICIPALITIES MUTUAL INSURANCE Quote Specifications: Type of Plan: Insurance Company: Effective Date: Expiration Date: This quote is valid until Excess Workers Compensation Program League of Wisconsin Municipalities Mutual Insurance 1/1/2021 12/31/2021 1/1/2021 Premiums: Total Estimated Excess Premium*: $160,602 Minimum Excess Premium: $100,000 *Premiums include the Expense Constant for Wisconsin. Insured's Limit of Liability: Part One and Part Two, as defined in the attached policy samples, will be retained to the limits specified below by the insured: Part One — Workers Compensation Insurance Part Two — Employers Liability Insurance Insured's Specific Limit of Liability— Each Accident: $250,000 Insured's Specific Limit of Liability— Disease, Each Employee: $250,000 Aggregate Retention Limit: N/A Carrier's Limit of Liabil Part One — Excess Workers Compensation Insurance Part Two — Excess Employers Liability Insurance Part One: Carrier Limit of Liability — Each Accident: Statutory Carrier Limit of Liability — Disease, Each Employee: Statutory Part Two: Carrier Limit of Liability — Each Accident: $2,000,000 Carrier Limit of Liability — Disease, Each Employee: $2,000,000 Carrier Limit of Liability —Aggregate: N/A Premium Payments Billing Method(s): Agency Bill Installment Plan(s): Annual LEAGUE OF WISCONSIN MUNICIPALITIES MUTUAL INSURANCE Excess Plan: Premium Determination: Rate per $100 of Payroll Total Payroll: $33,514,531 Excess Rate: .47920 Carrier Excess Attach Point: $250,000 Carrier Limit of Liability Amount: Statutory Coverages/Endorsements We have reviewed the application and are providing those coverages provided by the standard Workers Compensation Policy (WC 00 00 00 C) and any state -mandated endorsements. Any coverages or endorsements not specifically mentioned in this quote are not included with this proposal. Item 3A (WC): WI Item 3B (EL): $1,000,000 Item 3C (Other States): None Quote Contingencies • This quote is based on payrolls, rates and experience modifications currently in effect as outlined herein. Any changes to these values or other rating factors, as mandated by regulatory entities, may result in adjustments to our proposal. Additionally, LWMMI reserves the right to adjust the quote if the payrolls or premiums change more than 10% prior to policy issuance. LEAGUE M ICIPAL51(V MUNICIPALITIES MUTUAL INSURANCE PROPOSAL — TERMS AND CONDITIONS Excess Insurance Program and Policies An excess insurance program is proposed for your Workers Compensation insurance. The definition and scope of the reimbursement of claims subject to the self -insured retention are described in the Self -Insurance Policy. This Agreement will govern the servicing of claims under the Policy. Specific Provisions Applicable to Individual Policies For Workers Compensation, your responsibility to pay for losses arising out of a single accident shall be limited to the self - insured retention (SIR) shown in the policy. The SIR includes losses and Allocated Claims Expenses arising out of a single accident. For occupational disease claims, as defined in the policy, this deductible shall apply to each employee. General Terms and Conditions 1. Premium, Audits and Offset You are responsible for payment of premium as indicated in the Policy. Premiums indicated in this proposal are subject to audit and are initially paid as deposits subject to adjustment after policy expiration. The information necessary to accurately complete the audit will be obtained from statements submitted by you or by actual physical audit by us, at our sole option. You will keep records of information needed to compute the premium. You will allow us to audit all relevant records that relate to your policy premium. Information developed through audit will be used to determine final premium. We may conduct the audits during regular business hours during the policy period and within three years after policy expiration. If the final premium is more than the premium paid, you may pay the balance in accordance with the payment terms herein. If the final premium is less, we will, subject to the terms of this agreement, refund the excess providing you have no outstanding obligations to us. Where permitted by state law, we may offset any balance, whether on account of premiums, audits or by reason of any other sums due to or from us under the policy or this agreement, against sum due to or from you. 2. Payment/Default a. We will issue you a billing statement for the following to the extent that they apply: (1) Premiums, (2) Losses paid on your behalf by us, b. All amounts are due and payable as set forth in the billing statement. If balances are not received by us within: (1) Ten (10) days for premium installment; (2) Thirty (30) days for reimbursements of deductibles or premium developed on audits; c. You may be in default under this agreement if: (1) payments are not paid pursuant to the express provisions herein; (2) you have not furnished initial, new or replacement security as required; (3) you have not furnished a required increase in security; or (4) you have defaulted on any other obligation. d. Upon Default we may be entitled to the following remedies where permitted by state law: (1) At our option, we may draw all or part of the amount available under security. In the event of such a draw, we shall deposit the security proceeds in excess of your current obligations in a bank to be held as security for your obligations; LEAGUE M ICIPAL51(V MUNICIPALITIES MUTUAL INSURANCE (2) We may immediately terminate some or all of your rights to defer payment of your obligations hereunder and declare your obligations hereunder to be immediately due and payable; (3) Per the terms and conditions of the original policy and where permitted by state law, we may terminate your insurance program or any policy issued hereunder, and cancel or non -renew any certifications or filings made on your behalf; (4) We may pursue any and all legal and equitable rights and remedies available under applicable law. e. You will not pay interest or late charges in excess of the rate allowed by the laws of the state having jurisdiction. The parties intend to comply with applicable statutes and regulations; therefore, the interest or late charges under this agreement shall be limited to that permitted under such law. f. Where permitted by state law, your failure to satisfy your obligations as defined in this agreement shall constitute a gross default, entitling us to declare all obligations immediately due and payable. In the event of default, premium and deductible loss payments under this agreement will include our estimate of ultimate premium and losses developed to the ultimate value; and all costs and expenses, including attorney fees for the enforcement of any obligations hereunder, including without limitation the fees and expenses of collection of amounts due. 3. Claim Service We will adjust claims under the policy listed in this proposal. In the performance of its duties under this agreement we may retain attorneys and others on behalf of you. We do not assume any liability for claims or expenses under the self insured retention portion of the policy except as specifically provided in the policy or this agreement. Per the policy subject to this agreement, you will give us prompt notice of all covered claims, suits and any occurrences that are likely to result in any claims or suits, and you will provide all necessary assistance and cooperation to us. Nothing in this paragraph is intended to alter the regulatory or contractual rights and obligations of you or us under policy. We shall service covered claims in accordance with accepted practices and applicable state law governing claim practices. Except as otherwise provided under policy, we shall not be deemed to be the guarantor of your obligations. We retain ultimate settlement authority which we can exercise, in our sole discretion, at any time. 4. Definitions a. Agreement means this entire contract, including the proposal, Options, Terms and Conditions, Notes, Coverages and Limits of Liability and other provisions including the General Provisions and any exhibits attached hereto. Allocated Claim Expenses includes, but is not limited to: (1) independent medical examinations and medical reports and records; (2) court costs and fees for service of process; (3) attorneys and hearing representatives; (4) court reporter services and transcripts; (5) stenographic services and transcripts; (6) witness fees and expenses; (7) vendor interface charges; (8) bond premiums; (9) printing costs related to trials and appeals; (10) testimony, opinions, appraisals, reports, surveys, and analyses of professionals and experts; (11) trial and hearing attendance fees; LEAGUE M ICIPAL51(V MUNICIPALITIES MUTUAL INSURANCE (12) depositions, video statements, private investigators; (13) a charge for savings realized by you resulting from services associated with utilization review, hospital bill audit, provider bill audit; (14) Preferred Provider Organization utilization charges; (15) nurse case management and case management expenses and vocational rehabilitation management charges; (16) alternative dispute resolution fees; (17) protection and pursuit of subrogation and recovery rights; (18) on -site investigation if completed by a vendor; (19) expenses which are not defined as loss and are directly related to and directly allocated to the handling of a particular claim. c. Assessment(s) where permitted by state law means any current, expanded or newly implemented assessment, tax or other charge, whether payment is required by law or required as a condition of continued opportunity to service deductible claims or transact insurance in the applicable state. d. Claim Service means those services related to investigation, defense, negotiation and settlement of covered claims, including legally permitted activities related to subrogation and other recoveries. e. Medical Only means a Claim in which indemnity is zero, the incurred medical expense is greater than zero and the only allocated claim expense relates to case management or bill review. In addition, in the event an indemnity, medical or expense financial transaction arises during the handling of a claim and the ultimate amount of indemnity incurred, medical incurred and allocated claim expense incurred are each zero, such claim shall be treated as a medical only claim. For purposes of this agreement, the term financial transaction means posting a reserve to a claim by us. f. Obligations means all debts, liabilities and obligations of yours to us of every kind and description, direct or indirect, absolute or contingent, due or to become due, now existing or hereafter arising, whether arising under this agreement, or under any other agreement, document, or instrument, or by operation of law or otherwise, and further including, without limitation, all interest, fees, charges and expenses incurred by us. g. Other Than Medical Only means a claim that is not a medical only claim. IN WITNESS WHEREOF, you have: 1. Read and agreed to provisions of the Proposal, Deductible Policy and the Terms and Conditions contained herein; 2. Agreed to all of the provisions of the above and directed the execution of this agreement. By (Signature of Duly Authorized Officer) (Print or Type Name) (Title) (Date)