HomeMy WebLinkAbout2005-26078 ResoRESOLUTION NO. 2005-26078
A RESOLUTION OF THE MAYOR AND CITY COMMISSION OF
THE CITY OF MIAMI BEACH, FLORIDA, APPROVING THE
PURCHASE OF ALL RISK PROPERTY INSURANCE (FINE ARTS)
FOR'THE BASS MUSEUM OF ART AND THE CITY IN GENERAL,
FOR AN ANNUAL PREMIUM OF $50,000.00 FOR A ONE-YEAR
PERIOD, WITH AN OPTION TO RENEW FOR TWO (2)
ADDITIONAL YEARS, PROVIDED THE ANNUAL RATE DOES NOT
INCREASE BY MORE THAN TWENTY PERCENT (20%) PER
YEAR, ASPROPOSED, WITH LLOYDS UNDERWRITERS.
WHEREAS, as proposed by Arthur J. Gallagher and Co., the City's broker of record,
the Administration herein recommends the purchase of All Risk Property Insurance (Fine
Arts) for the Bass Museum of Art and the City in general, with Lloyds Underwriters, for a
total annual premium of $50,000.00 for a one-year period, with option to renew for two (2)
additional years, provided the annual rate does not increase by more than twenty percent
(20%); and
WHEREAS, funding is available from the Self Insurance Fund Number
540.1792.000390.
NOW, THEREFORE, BE IT DULY RESOLVED THAT THE MAYOR AND CITY
COMMISSlON'OF THE CITY OF MIAMI BEACH, FLORIDA, hereby approves the
purchase of All Risk Property Insurance (Fine Arts), for the Bass Museum of Art and the
City in general, for an annual premium of $50,000.00, for a one-y/~ar ~eriod, with option
to renew with Lloyds Underwriters for two (2) additional years, r/r/: vid~! the annual rate
does not increase by more than twenty percent (20%).
PASSED AND ADOPTED this 7th day of December ~' ]'J~2 5.
(,.,,/ ivra/o r
city 'Clerk
Robert Parcher
Condensed Title:
COMMISSION ITEM SUMMARY
Resolution authorizing the puchase of All Risk Property Insurance (Fine Arts) from Lloyds
Underwriters for the Bass Museum and the City in general for an annual premium.of $50,000.00 with
option to renew as recommended by Arthur J. Gallagher and Co., the City's Broker of Record.
Key Intended Outcome Supported:
IIncrease Community Ratings of Cultural Activities.
Issue:
Property Insurance (Fine Arts) for the Bass Museum of Art and the City in general is necessary to
protect the interest of the City. Coverage applies to art owned and on loan to the City at all locations.
The City budgets $50,000 to cover the premium costs. Self-insurance is not recommended as the
current estimated value of all art is $27,000,000.
Item Summary/Recommendation:
Approve the purchase of Property Insurance (Fine Arts) for the Bass Museum and the City in general
from Lloyds Underwriters.
Advisory Board Recommendation:
J Non Applicable
Financial Information:
Funds: $50,000.00 540.1792.000390
OBPI i~i~i'ii i~il $50,000.00
Financial Impact Summary:
City Clerk's Office Legislative Tracking:
ICliff Leonard
n-Offs'
T:~AGENDA~2005\Dec070~Consent\CMSumFin05.doc
MiAMiBEACH
AGENDA ITEM
DATE
M!AM!BEACH
CJ~ Of MJlJmJ I~ellch, 1700 Convention Center Drive, Miami Beach, Florida 33139, www.miamik~achlt.gov
COMMISSION MEMORANDUM
TO:
FROM:
DATE:
SUBJECT:
Mayor David Dermer and Members of the City Commission
Jorge M. Gonzalez, City Manager
December 7, 2005
A RESOLUTION OF THE MAYOR AND CITY COMMISSION OF THE CITY OF MIAMI
BEACH, FLORIDA, APPROVING THE PURCHASE OF ALL RISK PROPERTY
INSURANCE (FINE ARTS) FOR THE BASS MUSEUM OF ART AND THE CITY IN
GENERAL, FOR AN ANNUAL PREMIUM OF $50,000.00, FOR A ONE-YEAR PERIOD,
WITH AN OPTION TO RENEW FOR TWO (2) ADDITIONAL YEARS, PROVIDED THE
ANNUAL RATE DOES NOT INCREASE BY MORE THAN TWENTY PERCENT (20%)
PER YEAR, AS PROPOSED, WITH LLOYDS UNDERWRITERS.
ADMINISTRATION RECOMMENDATION
Adopt the resolution.
ANALYSIS
The City's Bass Museum property insurance needs are covered by All Risk Property
Insurance (Fine Arts). This insurance provides coverage at the Bass Museum, its storage
facilities, various sculptures located outside the museum, and art on loan to the Bass
Museum and the City.
The current policy with Lloyds Underwriters expires on December 31,2005. The annual
premium for the expiring policy is $38,500.00. The City's broker, Arthur J. Gallagher Co.,
following our directions, has identified a replacement policy with Lloyds Underwriters. The
new policy, which would be effective on December 31,2005, provides for All Risk Property
Insurance with the only changes being an increase in the windstorm deductible from
$5,000.00 to $25,000.00. The new annual premium is $50,000.00 representing an annual
increase of thirty percent.
The increase in premium is due to current market conditions and this year~s increase in
named windstorms/hurricanes. The museum is considered a high dsk by insurance
underwriters as compared to offsite storage as it is open to the general public and
exposure for an island community is greater for direct damage due to hurricane and flood.
As a result of changes in the marketplace, there are limited markets for this type of
specialized coverage and many are subject to high minimum premiums. Arthur J.
Gallagher and Co., has advised that Lloyds Underwriters is the only market able to provide
the required coverage, pricing and terms. The City has been able to continue this level of
coverage due to a long-term relationship with Lloyds Underwriters.
The policy provides for annual renewal. The Administration is seeking authorization to
purchase a new policy with option to renew for two additional years provided that the
annual rate does not exceed twenty percent. The Administration has reviewed with the
City's broker and they concur that the twenty percent cap for the renewal rate is
reasonable
The Administration recommends that purchase of the All Risk Property Insurance (Fine
Arts) for the Bass Museum of Art and the City in general for an annual premium of
$50,000.00 with option to renew, as proposed.
JMG:MDB:CL
T:~GENDA~2005\Dec0705\Consent\CMFin05.doc