1996-161E \WPDOCS\ORD\pUBLIC OFF
ORDINANCE NO ~
AN ORDINANCE ACCEPTING THE PROPOSAL OF NATIONAL UNION FIRE
INSURANCE COMPANY FOR PUBLIC OFFICIAL LIABILITY INSUR/LNCE COVERAGE,
AUTHORIZING THE EXPENDITURE OF FUNDS THEREFOR, AND DECLARING AN
EFFECTIVE DATE
THE COUNCIL OF THE CITY OF DENTON HEREBY ORDAINS
SECTION I That the proposal of National Union Fire Insurance
Company for public official liability insurance coverage for the
City of Denton, a copy of which is attached hereto and Incorporated
by reference herein, is hereby accepted
~ECTION II That the City Council hereby authorizes the
expenditure of funds in the manner and amount as specified in the
agreement
SECTION III. That this ordinance shall become effectIve
immediately upon its passage and approval
PASSED AND APPROVED this the /~F~ day of ~, 1996
JACK~
ATTEST
JENNIFER WALTERS, CITY SECRETARY
** EMPLOYERS GENERAL
** *, * Insurance Group, Inc
Sherman Servme Office Jim Lelnsrt
123 N Crockett SuRe 600 Senior Marketing Execuhve
Sherman Texas 75090
(903) 893-9477
FAX (903) 892-6593
Home (903) 892-8600
June 26, 1996
City of Denton
Arm Max Blackburn
City Manager
215 East McKmney Street
Denton, Texas 76201
Re Public Officials Liability
Policy # 445-42-72
Dear Max
As you are aware, your Public Officials coverage with National Umon Fire Insurance
Company will expire at 12 01 a m on July 17, 1996
In an effort to obtain the most competitive pnee for the City of Denton, we have gone to
three/hfferent markets for flus coverage As you are aware, the Pubhe Offiaals habihty is a
very speaahz~'.xi market and there are only a handful of eompames that write flus coverage
In ad/htlOn to National Umon, we have contacted National Casualty and Apex insurance
National Casualty still will not quote Public Officnals coverage unless the city maintains police
liability through an approved canner As you know, we are working with Apex at the current
time and have furnished them with some additional reformation that they had requested We
hope to have their quote prior to July 17, but their indication to us m their memo was that
their price would be m the $60,000 to $70,000 range I do not think that any of the
reformation that they requested from us would cause them to come m with a pnee lower than
the National Umon quote
page 1
Member of the Old Republic Insurance Group
page 2
The Nattonal Umon Fire quotes are as follows
QUOTE I - $1,000,000 per wrongful act subject to $1,000,000 aggregate
with $25,000 deductible, inelud,ng the employment practices
endorsement and choice of counsel endorsement, total annual
premium - $45,535
QUOTE II - $1,000,000 per wrongful act subject to $1,000,000 aggregate
with $25,000 deductible, including the employment practices
endorsement and without choice of counsel endorsement,total
annual premium - $40,982.
As you know, the premaum for flus coverage has been at $32,240 smee it was written by
NaUonal Umon Fire m 1992 The premium has stayed at flus level for four years The
increase m prenuum they feel is justified smee the city budget was $128,401,000 compared to
the current budget of $153,015,529, therefore, the enys' budget has increased approx, mately
$25,000,000 from when flus coverage was originally written They md~eate flus as the reason
for the premium increase
We &scussed the possibflaty of not mcludmg the employment practaces endorsement,
however, they m&cale if we do not include flus endorsement there would be no coverage for
wrongful termmatmn and that is a very important part of flus Pubhc Officials coverage I am
attaching a copy of the employment practices endorsement that is not currently on your pohcy
and I flunk provides some addmonal coverage for the city officials
Please review and gave me a call of any quesUons that you maght have concerning flus
renewal offer We will contact you as qmckly as we receive the other quote from Apex
We certainly appreciate working with you and the Cay of Denton and apprecxate the
opportumty to provide you with flus quote
Smcerely,
mart
Semor Marketing Executave
J-L/cs