Adopt Resolution #14-01-008 Extending Fee Agreement With Bearence Management Group for Agent of Record Services for the City's Property, Casualty and Worker's Compensation Insurance Services.

Purpose:  The city carries its liability and worker's compensation coverage through the League of Minnesota Cities.  Each Municipality has a contracted representative, known as the Agent of Record, that acts on their behalf for these insurance services .

Background:
   The City of Ramsey has had an agreement with Bearence Management Group (formally T.C. Field & Company since 1997 for agent of record services for property, casualty and worker's compensation insurance services.  The last formal agreement, which was for three years, ended on December 31, 2013.  A separate premium is paid to Bearence for Worker's Compensation insurance, which is 2% of premiums paid.  The 2% fee is incorporated within the total premium charged.  The City has not yet received its 2014 General Liability and Worker's Comp billings, but for year 2013, these amounts were $193,054 and $110,417, respectively.

The city has paid the following for agent of record services in the last three years:  2011:  $5,800;  2012:  $6,000; 2013:  $6,200.

 

Bearence Management Group has submitted a five-year fee proposal for the years 2014-2018 with the constant rate of $6,200.  The city's purchasing policy states that contracts can be longer than three years, as proposed, with city council approval.

The proposed agreement calls for a fee of $6,200 annually.  In comparison, the neighboring cities of Champlin pays $24,000 annually, Anoka - $10,000 + 2% of Workers Compensation and Elk River - 7% of total liability and workers compensation premiums.

Alternative #1:  Enter into five-year contract with Bearence Management Group for the annual fee of $6,200.

Alternative #2:  Enter into a ___-year contract with Bearence Management Group for the annual fee of $6,200.

Alternative #3:  Do not accept the terms of the agreement and either bring back a renegotiated amount/term or request proposals from other firms.

Agent of record fee is included in the annual General Fund Budget under professional services.

Staff recommends alternative #1.  Staff has built a relationship with Bearence Management Group and finds that they act in the City's best interest.  Also, the fee that they are proposing remains constant and is significantly lower than that paid in surrounding communities.

Motion to Adopt Resolution #14-01-008 Extending Fee Agreement With Bearence Management Group for Agent of Record Services for the City's Property, Casualty and Worker's Compensation Insurance Services.