Note 12 Risk Management

Meeting Date: November 13, 2014

Agenda Item #11

Note from TheGardeningSnail: Parts of this page may have been prepared by running a PDF Image Document through a program which converts image to text. My apologies for any Textual Gremlins that may have slipped in.

Note 12 – Risk Management

The City participates with other public entities in a joint venture under a joint powers agreement which establishes the Central San Joaquin Valley Risk Management Authority (CSJVRMA). The relationship between the City and CSJVRMA is such that CSJVRMA is not a component unit of the City for financial reporting purposes.

The CSJVRMA is a consortium of cities in the San Joaquin Valley, California. It was established under the provisions of California Government Code Section 6500, et. seq. The CSJVRMA is governed by a Board of Directors, which meets three to four times each year, consisting of one member appointed by each member city. The day-to-day business is handled by a management group employed by the CSJVRMA. The financial statements of CSJVRMA can be obtained at 1750 Creekside Oaks Drive, Suite 200, Sacramento, CA 95833.

Each member government pays a primary deposit to cover estimated losses for a fiscal year (claims year). Six months after the close of a fiscal year, outstanding claims are valued. A retrospective deposit computation is then made for each open claims year. Costs are spread to members as follows: the first

$25,000 of each occurrence is charged directly to the member. Each member maintains a $1,000,000 self­ insured retention (SIR) amount covered by the Authority pooled investments.. The Authority purchases excess liability coverage through the California Affiliated Risk Management Authority for the amount in excess of $1,000,000. Reinsurance coverage is purchased by the Authority through American Reinsurance for the amount in excess of $1,000,0000 up to $9,000,000 at 25% quota share. The City purchases Workers Compensation insurance through the Authority. The City maintains a $350,000 SIR with the Authority. Excess coverage· is purchased by the Authority through Continental Casualty for up to

$5,000,000 per accident in excess of the SIR. The City also purchases various property coverage programs. Deductibles and limits per property type can be obtained from the City Manager or directly from the Authority.

Note 12 Risk Management

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