95-21845 Reso RESOLUTION NO. 95-21845
A RESOLUTION OF THE MAYOR AND CITY COMMISSION
OF THE CITY OF MIAMI BEACH, FLORIDA,APPROVING
AND AUTHORIZING THE MAYOR AND CITY CLERK TO
EXECUTE A CONTRACT WITH ARTHUR J. GALLAGHER
& COMPANY TO PROVIDE INSURANCE BROKERAGE
SERVICES TO THE CITY FOR TWO YEARS,AT A FEE OF
$35,000.00 PER YEAR, WITH AN OPTION FOR TWO
ADDITIONAL ONE-YEAR RENEWAL PERIODS.
WHEREAS, at a regular meeting on November 21, 1995,the Mayor and City Commission,
accepting the findings and rankings of a selection committee, awarded RFP 17-95/98, entitled
"Insurance Broker Services," to the top-ranked proposer, Arthur J. Gallagher& Company; and
WHEREAS, pursuant to the Mayor and City Commission's directive, the Administration
has negotiated the attached contract with Arthur J. Gallagher & Company to provide insurance
brokerage services to the City for a two-year period,at a fee of$35,000.00 per year, with an option
for two additional one-year renewal periods.
NOW, THEREFORE, BE IT DULY RESOLVED by the Mayor and City Commission
of the City of Miami Beach, Florida, that the Mayor and City Clerk are authorized to execute the
attached contract with Arthur J. Gallagher& Company to provide insurance brokerage services to
the City for two years, at a fee of$35,000.00 per year, with an option for two additional one-year
renewal periods.
PASSED AND ADOPTED this2Othday of Dec: ber , 1995.
AYOR
A I EST:
FORM APPROVED
CITY CL RK LEGAL DEPT.
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Date 14' 1t/ 95"
CITY OF MIAMI BEACH
CITY HALL 1700 CONVENTION CENTER DRIVE MIAMI BEACH FLORIDA 33139
COMMISSION MEMORANDUM NO. q(1 lo-q
TO: Mayor Seymour Gelber and Date: December 20, 1995
Members of the City Commission
FROM: Jose Garcia-Pedrosa
City Manager
SUBJECT: A Resolution Authorizing the Mayor to Execute an Agreement with Arthur J.
Gallagher& Co. to Provide Insurance Broker Services for Two Years, at a Fee
of$35,000 Per Year, with an Option for Two Additional One-Year Periods,
Pursuant to RFP 17-95/98
ADMINISTRATION RECOMMENDATION:
Approve the Resolution.
BACKGROUND:
On November 21, 1995,the City Commission authorized the Administration to negotiate a contract
with Arthur J. Gallagher& Co. to provide broker services for all insurance needs. Gallagher was
selected as the top-ranked company based on their response to RFP No. 17-95/98. The major terms
of this agreement are:
service commencement date is December 21, 1995
- agreement is for two years with an option for two additional one-year periods
- service fee is $35,000 per year
- premiums for any policies purchased will be net of any commission to Arthur J.
Gallagher& Co.
broker is responsible for the placement and servicing of all existing City insurance
policies (except life,health, and dental)
CONCLUSION:
The Commission should approve the Resolution to execute an agreement with Arthur J. Gallagher
& Company. Funds are available for this service in Self-Insurance Fund Account Number
540.1790.000312.
AGENDA ITEM C. C
JGP/P L/TB/bh DATE (2-?J-q S
f:\risk\$all\commmemo\rfp 17-95-98
FEE SERVICE AGREEMENT
THIS AGREEMENT is made and entered into this 21st day of December, 1995, by and between
CITY OF MIAMI BEACH,a municipal corporation(City), and ARTHUR J. GALLAGHER&
CO. (Florida) ,a Florida corporation (Gallagher).
I. RECITALS
A. City desires to insure its Property, Workers' Compensation, Fine Arts, Crime, Underground
Storage Tank Liability and other property/casualty risks as needed.
B. Gallagher is engaged in the business of advising its clients on their insurance needs and
procuring insurance on behalf of its clients as an insurance broker.
C. Gallagher desires to provide certain administrative services and required insurance brokerage
services to City and City desires to have Gallagher provide such services in accordance with
the terms hereof.
II. TERM AND TERMINATION
A. Term
This agreement shall be effective for an initial term of two (2) years commencing
December 21, 1995 and shall remain in full force and effect until December 21, 1997.
Thereafter this agreement may be renewed for two (2) successive one-year terms at the
option of the City.
B. Termination
Either party may terminate this Agreement, with or without cause, upon the conclusion of
the initial term or the conclusion of any successive renewal term by providing ninety (90)
days prior written notice. In the event either party materially breaches this Agreement at any
time,this Agreement shall terminate upon failure of the breaching party to remedy the breach
within thirty (30) days of receipt of written notice of the breach.
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III AGREEMENT
A. Obligations of Gallagher
1. Gallagher shall provide services in accordance with Exhibit A, attached hereto and
made a part hereof.
2. Gallagher shall use its best efforts to secure insurance required for the proper
administration of City's business. In the event an insurance company cancels or
refuses to place the necessary insurance,Gallagher shall use its best efforts to obtain
the coverage from another insurance company.
B. Obligations of City
1. In addition to the fees provided herein, it is understood and agreed that other parties,
such as excess and surplus line brokers, wholesalers, reinsurance intermediaries,
underwriting managers and similar parties, some of which may be owned in whole
or in part by Gallagher's corporate parent, may earn and retain usual and customary
commissions and fees in the course of providing insurance products to City pursuant
to this Agreement. Any such fees or commissions will be the responsibility of City
and not Gallagher.
2. City is responsible for payment of premiums for all insurance placed by Gallagher
on its behalf, as long as placement was made with City's prior approval.
3. If any amount is not paid in full when due, including premium payments to insurance
companies, that non-payment shall constitute a material breach of this Agreement,
and Gallagher may terminate this agreement for cause, at its option, in accordance
with Section II.B
C. Mutual Obligations
1. Ownership of Records and Documents
a. Gallagher agrees that all books, records, list of names,journals, ledgers and
other recorded information developed specifically in connection with the
administration of City's account shall always be and remain the property of
City.
Gallagher agrees to keep all such material confidential and not to reproduce,
disclose or disseminate the material or the information contained therein to
third parties without the prior written consent of City, to the extent possible
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under the Public Records Laws of the State of Florida. Upon termination of
this Agreement for any reason, Gallagher shall immediately return all such
material, and any copies thereof,to City.
b. City agrees that Gallagher is the sole owner of the following material and the
City has no right to its use following termination of this Agreement:
I. Proprietary computer programs
II. Proprietary procedures and methods of administration
III. Underwriting and client files developed by Gallagher
City agrees that all such material is confidential (to the extent possible under
the Public Record Laws of the State of Florida)and not to reproduce,disclose
or disseminate the material or the information contained therein to third
parties without the prior written consent of Gallagher. Upon termination of
this Agreement for any reason, City shall immediately return all such
material, and any copies thereof, to Gallagher.
2. Employees of Gallagher
City agrees that during the term of this Agreement and for a period of one year
following the date of the termination of this Agreement,it will not utilize the services
of any individual who was an employee of Gallagher during the term of this
Agreement, or any renewal, as an employee to perform services for City similar to
those services provided by Gallagher under this Agreement.
3. Force Majeure
Gallagher shall not be liable for any delay or nonperformance of any covenants
contained herein nor shall any such delay or nonperformance constitute default
hereunder, or give rise to any liability for damages if such delay or nonperformance
is caused by "force majeure". As used herein, the term "force Majeure" means fire,
explosions, action of the elements, strikes or other labor relations problems,
restrictions to restraints imposed by law, rule regulation or order of public authority,
whether federal, state or local, and whether civil or military, acts of military
authority, interruption of transportation facilities, acts of insurance companies,
underwriters or other assumers of risks of City, and any other cause which is beyond
the reasonable control of Gallagher and which by the exercise of reasonable diligence
Gallagher is unable to prevent. The existence of such causes of such delay or
nonperformance on the part of Gallagher thereby to such extent as may be necessary
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to enable it to complete performance in the exercise of reasonable diligence after the
cause of delay or nonperformance has been removed.
4. Waiver of Nonperformance
No waiver of any default in performance on the part of Gallagher or like waiver by
City, or any breach or a series of breaches of any of the terms, covenants or
conditions of this Agreement shall constitute a waiver of any subsequent breach or
a waiver of said terms, covenants or conditions. Resort to any remedies referred to
herein shall not be construed as a waiver or any other rights and remedies to which
either party is entitled under this Agreement or otherwise.
5. Partial Invalidity
Should any part of this Agreement, for any reason, be declared invalid by court of
competent jurisdiction,the remaining portion shall remain in full force and effect as
if this Agreement had been executed without the invalid portion.
6. Governing Law
The validity, interpretation and performance of this Agreement shall be controlled
and construed according to the internal laws of the State of Florida.
7. Indemnification and Insurance
a. Gallagher agrees to indemnify,protect,save and hold harmless City from any
and all loss, cost, damage or exposure arising from the negligent acts or
omissions of Gallagher.
b. Gallagher agrees to maintain professional liability insurance (errors and
omissions) in the amount of$1 million per occurrence throughout the term
of this agreement. Gallagher agrees to provide an original certificate of
insurance as evidence of this coverage.
8. Successors
This Agreement shall be binding upon and shall inure to the benefit of all assigns,
transferees and successors in the interest of the parties hereto.
9. Entire Agreement; Modification or Amendment
This Agreement and the Exhibit hereto represent the entire and exclusive statement
of the agreement of the parties and may be modified or amended only by a written
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statement signed by both parties. Such modification or amendment shall be attached
to, and shall thereupon become a part of this Agreement.
10. Headings herein are for convenience of reference only and shall not be considered
in any interpretation of this Agreement.
11. Practice of Law
It is understood and agreed that Gallagher will not perform,and City will not request
performance of,any services which may constitute the unauthorized practice of law.
12. Counterparts
This Agreement may be executed by the parties in several counterparts, each of
which shall be deemed to be an original copy.
13. Remedies Not Exclusive
No remedy conferred hereunder is intended to be exclusive of any other remedy and
each and every remedy shall be cumulative and shall be in addition to every other
remedy given hereunder or now or hereafter existing at law or in equity or by statute
or otherwise.
14. Subcontracting
Gallagher may not subcontract any of the services required to be performed by it
hereunder.
15. Request for Proposals No. 17-95/98 (Insurance Broker Services) issued by City in
contemplation of the Agreement,together with all amendments thereto, if any, and
Gallagher's proposal in response thereto, is agreed as being incorporated by reference
in this Agreement and made a part hereof; provided, however, that in the event of an
express conflict between the Proposal documents and this Agreement, this
Agreement shall prevail.
16. Limitation of Liability
City desires to enter into this Agreement only if in so doing City can place a limit on
the City's liability for any cause of action for money damages due to an alleged
breach by City of this Agreement, so that its liability for any such breach of contract
be limited to a maximum of$35,000. Accordingly, and notwithstanding any other
term or condition of this Agreement, Gallagher hereby agrees that City shall not be
liable to Gallagher for damages in an amount in excess of $35,000, for any action
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or claim for breach of contract arising out of the performance or non-performance of
any obligation imposed upon City by this Agreement. Nothing contained in this
paragraph or elsewhere in this Agreement is in any way intended to be a waiver of
the limitation placed upon the City's liability as set forth in Florida statutes, Section
768.28.
IN WITNESS WHEREOF, the parties hereto have caused this agreement to be executed on the
date first written above
CITY/ MIAMI BEACH,
,fr
in!.
Att•st: By:/
j
Mayor
City Clerk
ARTHUR J. G•i AGHER & CO. (FLORIDA)
Attest
FORM APPRO'VF_D
LEGAL
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EXHIBIT A
SERVICES
SCOPE OF SERVICES
Advisor-Insurance Broker agrees to assist the City with the following Risk Management
services:
1. Provide assistance to the City's Risk Manager in determining the City's commercial
insurance needs.
2. Prepare reports informing the City's Risk Manager regarding insurance market
conditions that may affect the City's policies and risk exposure prior to policy
renewal.
3. A minimum of 120 days prior to the expiration of any policy, prepare bid
specifications and underwriting data (subject to the approval of the City's Risk
Manager) to submit to acceptable insurance markets for the purpose of obtaining
quotations for insurance coverage and provide the names of all insurance companies
to be contacted.
4. Upon direction from the City, approach all insurance companies acceptable to the
City, and obtain written, competitive quotes for insurance coverage. A minimum of
five(5) insurance companies shall be contacted for any type of risk. A complete list
of the companies contacted, along with their response, shall be submitted.
5. A minimum of thirty (30) days prior to the expiration of any policy, present to the
City all insurance coverage proposals obtained. This report will contain a
comprehensive analysis of the proposals obtained with recommendations for the
selection of one proposal for the particular risk to be covered.
6. Negotiate,on behalf of, and with direction from, the City with all insurance carriers
to obtain the best prices,terms and conditions available.
7. Review all insurance policies and invoices received for policies purchased by the
City to assure their accuracy and appropriateness.
8. Review and evaluate existing City policies to provide recommendations for possible
improvement of price,terms, and conditions.
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9. Service existing policies as necessary. This includes, but is not limited to, issuing
certificates of insurance to provide evidence of coverage, promptly making policy
changes, and obtaining endorsements.
10. Report any claims to the insurance carrier and monitor the handling and disposition
of the claim to assure the City's policy rights are protected.
11. Provide other services to the City's Risk Manager as normally expected from a full-
service professional insurance broker.
12. Provide an annual report summarizing all insurance coverage in place, anticipated
market conditions, recommendations and strategies.
II. RISK MANAGEMENT FEES FOR CONTRACT TERM
$35,000 Per Year
In the event the City should require Gallagher to place on its behalf any policy above
$30,000 in annual premium, (not currently purchased by the City or specifically named in
I.A. of this agreement), or complete a special project of significant nature above and beyond
the scope of services stated in this agreement,the City and Gallagher will mutually negotiate
and agree upon a reasonable fee in addition to what is shown above. In the event a
reasonable fee cannot be negotiated, the City is not restricted by the existence of this
agreement in obtaining the necessary services in any manner it desires.
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