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Various RTA Insurance Coverages 2023-2024
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DESCRIPTION: Renewal of various insurance coverages for policy period 2023-2024. |
AGENDA NO: Click or tap here to enter text. |
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ACTION REQUEST: ☒ Approval ☐ Review Comment ☐ Information Only ☐ Other |
RECOMMENDATION:
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To authorize the Chief Executive Officer to proceed with the renewal of specified insurance coverages for the policy period 6/1/23-6/1/24 in the amount of $2,465,669.31.
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ISSUE/BACKGROUND:
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RTA annually renews a group of various insurance coverages on June 1st. These include Overhead Catenary Systems [“OCS”], Property/Excess Property, Public Entity/Employment Practices Liability, Crime, and Flood. The policies are marketed and placed by the RTA insurance broker of record, The Kennedy Financial Group of Louisiana, Inc., and provide optimal coverage at the most competitive cost.
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DISCUSSION:
It is necessary that RTA proceed with the renewal of these insurance coverages through the RTA broker of record, The Kennedy Financial Group of Louisiana, Inc., on a timely basis:
Overhead Catenary Coverage [“OCS”]: Total Insured Value of $29,060,797, covering all catenary lines in the RTA streetcar system, including wires and poles. Total limits: $12M.
Property/Excess Property: Total Insured Value of $120,311,275, extending to thirteen (13) locations, inclusive of buildings and contents, and corollary structures (station stops, substations, etc.) and the land-based portion of the Canal Street Ferry Terminal.
Public Entity/Employment Practices Liability: $5M per wrongful act, covering public officials/employees for errors or omissions in duty.
Crime: $1M/$500,000 limits, covering forgery and alteration, on-premises/off-premises theft and burglary, computer fraud, funds transfer fraud, and related financial crime.
Flood: Twelve (12) locations. Limits of $500,000 per building, with the exception of the chassis wash at ENO with limits of $250,000.
Details of the respective coverages can be found in the Resolution and associated attachments.
For comparative purposes, the total cost for these respective coverages for policy period 2022-2023 was $1,648,748.61. With changes in market conditions, the total cost for the same coverages for policy period 2023-2024 is $2,465,669.31, yielding an increase of $816,920.70 from last year (approximately 50%).
This increase is directly attributable to a challenging property insurance market, particularly in Southeast Louisiana, which experienced significant losses due to multiple catastrophic storms in CY 2020 and CY 2021. In addition, current economic uncertainty has driven up property insurance rates, with demand greater than supply in the property arena.
FINANCIAL IMPACT:
$2,465,669.31
Funds for these contracts are available from the RTA Operational budget. (See attachments for details.)
NEXT STEPS:
Proceed with the renewal of insurance coverages as indicated above.
ATTACHMENTS:
• Resolution for Contract Award of Various Insurance Coverages 2023-2024
• RTA Comparison Spreadsheet: 6/1/23-2024 Insurance: Expiring versus Renewal
• Marketing Summary Report - Property & OCS
• RTA Wright National Flood Renewal 2023-2024
Prepared By: Mark Popkin
Title: Risk Analyst
Reviewed By: Gizelle Banks
Title: Chief Financial Officer
Reviewed By: Mark A. Major
Title: Deputy CEO
5/18/2023
Lona Edwards Hankins Date
Chief Executive Officer