R-91-1615 - 6/13/1991WHEREAS, the City of Round Rock is in need of the services of an
insurance and risk management advisor, and
WHEREAS, Risk Management Group, Inc. has submitted a proposal to
provide the needed services, and
WHEREAS, the Council wishes to approve said proposal, Now
Therefore,
BE IT RESOLVED BY THE COUNCIL OF THE CITY OF ROUND ROCK, TEXAS,
That the Mayor is hereby authorized and directed to execute on
behalf of the City an Agreement with Risk Management Group, Inc. to
provide the above stated services, a copy of said Agreement being
attached hereto and incorporated herein for all purposes.
RESOLVED this 13th day of June, 1991.
ATTEST:
RS06131G
E LAND, City Secretary
RESOLUTION NO. /6/3
MIKE ROBINSON, Mayor
City of Round Rock, Texas
mioliuste
RISK MANAGEMENT GROUP, INC.
Riskfaune stfinceMacigementConsultants
Mr. Mike Robinson, Mayor
City of Round Rock
221 East Main Street
Round Rock, Texas 78664
Re: Insurance & Risk Management Consulting
Dear Mr. Robinson:
This letter will serve as the basis of our relationship with the
City of Round Rock as an insurance and risk management advisor
effective this date.
It is acknowledged that information obtained by our firm
concerning the City will be treated as confidential and will not
be released to outside parties without prior approval.
The services to be performed are detailed in the attached
proposal dated June, 1991. It is agreed that the maximum fee for
these initial services is will not exceed $5,000 to $7,500.
The City of Round Rock agrees to reimburse Risk Management Group
in connection with certain expenses in connection with the
services rendered. Reimbursed expenses shall include long
distance telephone, copying of bid specifications and reports and
other miscellaneous expenses.
Fee and expense billings will be submitted at the beginning of
each month and are due and payable within 30 days of receipt.
If you agree with the terms and conditions of this letter, please
indicate your acceptance with signatures on tha following page.
Sincerely,
Donald K. Gt ay, ARM
Vice - President
CIELO CENTER • 1250 CAPITAL OF TEXAS HIGHWAY SOUTH • 214 BUILDING TWO
P. O. BOX 161000 • AUSTIN, TX. 78716 - 1000.512/329 -2690
HOME OFFICE. CHARLOTTE N. C /ASSOCIATE OFFICE' DENVER, CO.
ACCEPTED BY:
The City of Round Rock Risk Management Group, Inc.
Mr. Mike Robinson
Mayor
Title
2e VilL., l 1 1 99
..a e
41d,t
1111_! iA
Joanne Land
City Secretary
Title
Da (aun . I'7 199 I
M Donald K. Gray
Vice - President
Title
Date
Proposal for
Risk Management Consulting Services
for the
City of Round Rock
Prepared by:
' Risk Management Group, Inc.
1250 Capital of Texas Hwy. South
Austin, Texas 78746
June, 1991
RISK MANAGEMENT GROUP, INC.
Part A
Part B
TABLE OF CONTENTS
Introduction 1
Proposed Risk Management Services 2
Phase I - Review of Loss Exposures and
Funding Mechanisms
Phase II - Insurance Bidding
Part C Structure of the Work 4
Part D Proposed Fee Structure 6
Part E Biographical Data 7
Part F References 8
RISK MAMAGEMENT GROUP, IN[.
PART A
INTRODUCTION
Risk Management Group is pleased to provide this proposal for risk
management consulting services for the City of Round Rock
(the City). Before detailing our proposed services, we would like to
give you a brief bit of background about our organization.
Risk Management Group was founded in 1980. Our consultants have
extensive risk management consulting experience and are well versed
in working with public entities in Texas. Each Senior Consultant has
obtained the distinguished "ARM" or "C.P.C.U." professional
designations. The firm and its consultants are licensed to provide
insurance consulting services as required by Texas statutes.
Our client list includes more than 50 firms and organizations located
from Massachusetts to California. On a combined basis, these clients
have properties valued at more than $5 billion, operating revenues of
more than $1 billion and employ more than 21,000 people. These
clients are served by the staff of our Charlotte and Austin offices
as well as personnel from our associate office in Denver.
Risk Management Group is privately owned by the principals of the
firm and is devoted solely to the practice of risk and insurance
management consulting. The principals of the firm are members of the
Society of Risk Management Consultants and fully support the
organization's code of ethics.
The firm does not sell insurance, is not affiliated with any
insurance sales organization, and does not promote a particular
coverage or industry program. Our independent status puts us in the
proper position to provide the unbiased and objective opinions sought
by our clients.
We hope that the City will find our proposal acceptable as we would
welcome the opportunity to be of service.
Page 1
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RISK MANAGEMENT GROUP.INC,
PART B
PROPOSED RISK MANAGEMENT SERVICES
Our goal would be to provide the City with the services detailed
below as Phase I and Phase II in regard to the following areas
of risk:
1. Physical loss of property and the attendant financial loss
that can result. Included in this would be Fire, Boiler
and Machinery, Mobile Equipment, or other Property Damage
insurance programs, as well as Fidelity and Crime insurance
programs.
2. Legal Liability for Personal Injury and Property Damage to
employees and the public. Included within this would be
General Liability, Public Official's Liability, Law
Enforcement Liability, Automobile Liability, and Workers'
Compensation.
Phase I: Review of Loss Exposures and Funding Mechanisms
Upon being retained by the City, we are proposing to review the City's
various exposures to accidental loss. With this information, we can
then evaluate the funding mechanisms currently in place to respond to
these loss exposures. This review will result in an Opinion Letter
with comments in regard to the adequacy of current coverages to
respond to the loss exposures. In addition, the letter will include
recommendations for improvements in coverage and suggested
alternate- funding mechanisms, if applicable.
II: Insurance Bidding
After completing Phase I, it is proposed that we will perform the
following work in connection with the bidding of insurance.
1. In regard to the October 1, 1991 anniversary, we will prepare
insurance bid specifications for the City's property,
liability, workers' compensation, and fidelity insurance
coverage. - Specifications will generally follow
your existing insurance coverages, but can request proposals for
coverage improvements suggested in the Phase I report.
Depending on the results of Phase I, this may include proposals
for "excess coverage" in the event the City may want to consider
certain forms of self- insurance. Coverages outlined in the
specifications will meet statutory requirements.
Page 2
®IIIL®IF"-
RISK MANAGEMENT GROUP, IMC.
II: Insurance Bidding (continued)
2. The bid specifications will include the necessary underwriting
data, coverage and rating options to obtain competitive bids
from commercial insurance companies through selected
agents /brokers, governmental self- insured "pools" (ie, TML and
TPSF), risk retention groups, and direct - writing insurance
companies. For your consideration, we will recommend markets
known to be competitive.
3. We will assist you by managing the bidding process. In order to
make certain that the proper degree of competition exists
between agents /brokers, we recommend assigning insurance
carriers to the interested agents. This encourages each agent
to strongly negotiate for improved pricing and coverage terms.
We will also handle all inquiries from interested proposers in
regard to the bidding process.
4. We will evaluate the bids /proposals in regard to items such as
the following:
a. Premium Costs,
b. Service Ability,
c. Financial Condition of the Insurer, and
d. Coverage Terms and Conditions.
5. We will.review the proposals with the City staff and prepare a
written recommendation to the City. In addition, we will
to make a presentation of the recommendation to the City
Council.
6. We will review the new insurance policies for completeness and
compliance with the bid specifications and the proposals.
7. We will provide the City staff will status reports during this
process to keep the staff advised of key developments.
Page 3
a11111ea!".
MEV Veit
R15K MANAGEMENT GROUP, INC.
PART C
STRUCTURE OF WORK
Phase I of our work will be structured in the following order:
1. Upon being retained, we will provide the City with a
detailed list of items we will need to review. Where possible,
this data should be sent to our firm in advance of our
preliminary visit. This list will include insurance policies,
insurance applications, loss information, agreements and
contracts.
2. A preliminary on -site visit will be arranged for the purpose
of:
a. Establishing necessary working relationships between your
personnel and our staff.
b. Conducting an Exposure Review of the City's operations.
3. In our offices, we will review the coverages presently in force
as to their ability to respond to the loss exposures. In
addition, we will review the City's loss and the
deductible levels. We will also review the calculation of your
insurance premiums and experience modifiers for accuracy.
4. To complete Phase I, we will prepare the Opinion Letter and
review it with the City staff. We will complete the Opinion
Letter within two weeks of being retained by the City.
Phase II will be structured as follows:
1. In addition to a public notice of the bid /proposal process in a
newspaper, we will work with the City staff to determine which
agents, brokers should be invited to participate in the bid
process.
2. We will work with the City staff to finalize a timetable for the
bidding project.
3. We will advise the City of any additional underwriting data not
previously obtained in Phase I.
4. We will assemble the information in our office and prepare
a draft of the specifications.
Page 4
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RISN MANAGEMENT GROUP, IN[.
5. We will arrange a follow -up meeting with the City to:
a. Review the draft of bid specifications.
b. Discuss the assignment of markets to agent and brokers.
c. Acquire any remaining support /research data required for
specifications.
6. We will submit bid specifications to markets and respond to
questions raised by vendors during bidding process.
7. Upon receipt of proposals we will prepare a written analysis
including the following:
a. Comparison of policy terms and conditions.
b. Comparison of premiums including cash flow and payment
options.
c. Comparison of support services offered by carriers, i.e.
engineering, claims administration.
d. Analysis of financial strength of carriers.
e. Recommendation for placement of coverage.
8. We will present the written recommendations to the City staff
and City Council and be available to discuss the
recommendations.
9. We will follow with existing and new carriers, agents or brokers
to arrange for the transition of coverage (October 1, 1991
effective date), including the verification of policies and
premiums under the new program.
Page 5 '2e®
RISK MANAGEMENT GROUP, INC.
PART D
PROPOSED FEE STRUCTURE
Risk Management Group proposed to undertake this project for the City
on an actual cost basis subject to a maximum or not -to- exceed amount.
Time records are kept for all consulting personnel and will be made
available upon request. The following schedule is our best estimate
of the time requirements for this project. Tight budgetary controls
are utilized by Risk Management Group to minimize fees for our
clients.
Consulting Fees:
Our fee schedule is as follows:
Principal and Senior Consultant: $105 per billable hour
Staff Consultants: $55 per billable hour
Based on similar projects for other entities, we anticipate that the
project may involve 60 to 90 hours of consulting time. As a result,
we would estimate a consulting fee in the range of $5,000 to $7,500.
We would agree to a maximum consulting fee of $7,500 for the services
outlined in this proposal.
Miscellaneous Expenses:
In addition to the above fee, the City would be billed for the actual
expenses incurred by Risk Management Group as listed below:
1. The City will be charged for any long distance telephone
expenses incurred by RMG based upon itemized statements of the
charges. These calls will generally be limited to the City's
insurance representatives. We would estimate long distance
calls to be in the range of $30 to $50 for this project.
2. The City will be charged for copying, binding and mailing
expenses in connection with the specifications. These
charges typically run between $8 -12.00 per set of
specifications. As many as ten sets of specifications may be —
prepared.
3. The City will be charged for the cost of photographic film and
development of photos of City property to be included in the
bid specifications. This expense should not exceed $20.00.
Page 6
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RISK MANAGEMENT GROUP, INC.
PART E
BIOGRAPHICAL DATA
The City of Round Rock will be served by the staff of our Austin
office.
Each Senior Consultant has obtained the distinguished "ARM" or
"C.P.C.U." professional designations. The firm and its consultants
are licensed to provide insurance consulting services as required by
Texas statutes.
By design, Risk Management Group is a relatively small firm in terms
of staff. We have assembled a team of consultants that specialize in
unique areas. As a result, we are able to provide our clients with
experience that is often not available in other consulting firms.
Donald K Gray, ARM (Senior Consultant) joined the firm in 1988 and
manages the operations of the Texas office. Don prepared for his risk
management career by majoring in Insurance and Risk Management at the
University of Texas - Austin, graduating in 1976. Don's background
includes extensive experience with Texas governmental entities. He
was employed by the Texas A &M University System during 1978 -1983. In
this capacity, he served as the "Manager of Insurance & Retirement
Programs" within the Insurance and Risk Management Department. During
the period of 1983 -1988, Don was employed as the "Director of
Insurance" at the Texas Association of Counties. The Texas
Association of Counties administers several self- insured "pools" for
county governments. The program includes workers' compensation,
property, and liability insurance and is very similar to the TML
program. Annual premiums to the TAC program exceed $40,000,000.
This background with governmental entities gave Don the opportunity to
become very familiar with governmental immunity and the Texas Tort
Claims Act. Our firm uses this knowledge to negotiate for premium
reductions, determine proper liability limits, establish self- insured
programs and advise underwriters. The Texas Political Subdivision
Fund (a state -wide self- insured workers' compensation program)
recently featured Don as a speaker on the topic of Governmental
Immunity & Liability Exposures.
William B. Brown, CPCU, ARM (Principal Consultant) is a 1963 graduate
of the University of North Carolina with a degree in Business. He also
did graduate work at the College of Insurance in New York. Bill works
in both the Austin and Charlotte, N.C. offices. Prior to forming Risk
Management Group, Bill co- founded one of the nations largest risk
management consulting firms (Risk Consultants). Bill was associated
with this firm for eleven years and served as the President. Other
experience includes underwriting and management positions with Chubb.
Bill has authored several risk management papers and has served as a
speaker for several risk management audiences.
Page 7 WPM et
v
RISK MANAGEMEN• GROUP IN[
PART F
REFERENCES
Please feel free to contact any of the following individuals in regard
to our abilities:
Mr. Neal Haverlah
Risk Manager
Lower Colorado River Authority
Austin, Texas (512) 469 -6876
Mr. Andy Wilkins
Finance Director
City of Denison
Denison, Texas (903) 465 -2720
The Honorable Kenneth Walker
Gregg County Judge
Longview, Texas (903) 236 -8420
Mr. Lyndell Moore
Randall County Auditor
Canyon, Texas (806) 655 -7011
Ms. Jill Estes
.Assistant Vice - Chancellor
Texas Christian University
Fort Worth, Texas (817) 921 -7798
Mr. Dan White
Vice President, Financial Administration
St. Mary's University
San Antonio, Texas (512) 436 -3727
Page 8
intrl
RISK MANAGEMENT GROUP, INC.
CLIENT LIST (Confidential)
Client
Austin White Lime
Bankers Trust
Brazos River Authority
Calhoun County
City of Denison
City of Gonzales
Colorado River Municipal Water District
Comanche County
Ector County
Fayette Power Project
Frio County
Galveston County Water Authority . . .
Gregg County
Hays County
Hemphill County
Incarnate Word College
Independent College & Universities of TX
Ingenio Oil
Investment Properties Management, Inc.
Karnes Electric Cooperative
Kaufman County Electric Cooperative . .
Kerr Drug, Inc
Lower Colorado River Authority
Matagorda County
Maywood, Inc
Medina Electric Cooperative
Minnie Stephens Piper Foundation
Mitchell County
Navasota Valley Electric Cooperative .
Nueces County Drainage District
Omaha Public Power Authority
•
Pecos County
Randall County
Rio Grande Electric Cooperative
San Bernard Electric Cooperative .
San Miguel Electric Cooperative
Sisters of Divine Providence
South Carolina Public Service
(Santee Cooper)
South Texas Electric Cooperative .
St. Mary's University
Tarrant County Water Control District .
Team Bank
Texas Christian University
United Exports Trading Association
Vellumoid, Inc
Victoria Savings Association
Western Counties Gas
Industry
Mining
Financial Institution
Water /Sewage
County Government
Municipality
Municipality
Water
county Government
County Government
Electric Generator
County Government
Water
County Government
County Government
County Government
University
University Association
Oil Production
Property Management
Electric Distribution
Electric Distribution
Retail Drug Store Chain
Water, Electricity
County Government
Door Manufacturer
Electric Generation/
Distribution
Private Foundation/
Oil Production
County Government
Electric Distribution
Water Drainage
Electric Generation/
Distribution
County Government
County Government
Electric Distribution
Electric Distribution
Electric Generation
Religious Order
Electric Generation
Electric Generation/
Distribution
University
Water
Financial Institution
University
Duty -Free Wholesale/
Retail Chain
Plastic Manufacturer
Financial Institution
Gas Processor
NIPS
A>t•1M Y
client3.lst
RISK MAN*GEMENT GROUP, INC.
DATE: June 11, 1991
SUBJECT: City Council Meeting, June 13, 1991
Item: 9 G. Consider a resolution authorizing the Mayor to enter
into an agreement with Risk Management Group Inc. for
acquisition of City insurance services.
The City spends $450,000 annually for insurance premiums (excluding
health insurance). Coverages include Propei#y, General Liability,
Automobile Physical Damage and Liability, Public Officials Liability,
Law Enforcement Liability, Mobile Equipment and Wokers Compensation.
It has been 3 years since the City has gone to the insurance market
place, and therefore, Staff recommends acquiring expert assistance from
Risk Management Group, Inc. (RMG) in evaluating and obtaining the
best insurance program available.
Due to the complexities of insurance policies, the fragile marketplace,
changes in workers compensation laws, the substantial cost of insurance
and the large investment in time required, expert assistance is needed
from a professional which deals with the insurance market place on a
daily basis.
RMG has provided excellent references, including the Texas Municipal
League, and has satisfactorily addressed all issues raised by Staff.
If retained, RMG would assist the City in evaluating its current
insurance program, identifying all coverages and programs currently
available, bidding new coverages, analyzing the proposals and making
a recommendation to the City. The cost of this service would not
exceed $8,000 and is within the current insurance budget. A presen-
tation will be made at the meeting and Mr. Don Gray of RMG will be
available to answer questions.
r ve 1V -a2-0 t dt L. 0. 6
Mayor
Mike Robinson
Mayor Pro.tem
Charles Culpepper
Council Members
Robert Stluka
Ttsh Oatman
Rick Stewart
Earl Palmer
Jimmy Joseph
City Manager
Robert L Bennett, Jr.
City Attorney
Stephan L. Sheets
July 25, 1991
Mr. Donald K. Gray, Vice — President
Risk Management Group, Inc.
P.O. Box 161000
Austin, Texas 78716 -1000
Dear Mr. Gray:
THE CITY OF ROUND ROCK
221 East Main Street
Round Rock, Texas 78664
512- 255 -3612
Fax 512 255 - 6676
Resolution No. 1615R was approved by the Round Rock City
Council on June 13, 1991.
Enclosed is a copy of the resolution and two original agreement
letters. Please sign both and return one original to me for
the City's file. If you have any questions, please call.
Sincerely,
Christine Martinez
Assistant City Secretary
CM /km
Enclosures
' I
LJ
7!!
CLIENT LIST (Confidential)
Client
Austin White Lime
Bankers Trust
Brazos River Authority
Calhoun County
City of Denison
City of Gonzales
Colorado River Municipal Water District
Comanche County
Ector County
Fayette Power Project
Frio County
Galveston County Water Authority
Gregg County
Hays County
Hemphill County
Incarnate Word College
Independent College & Universities of TX
Ingenio Oil
Investment Properties Management, Inc.
Karnes Electric Cooperative
Kaufman County Electric Cooperative . .
Kerr Drug, Inc
Lower Colorado River Authority
Matagorda County
Maywood, Inc
Medina Electric Cooperative
Minnie Stephens Piper Foundation . . •
Mitchell County
Navasota Valley Electric Cooperative .
Nueces County Drainage District
Omaha Public Power Authority
Pecos County
Randall County
Rio Grande Electric Cooperative
San Bernard Electric Cooperative
San Miguel Electric Cooperative
Sisters of Divine Providence
South Carolina Public Service
(Santee Cooper)
South Texas Electric Cooperative
St. Mary's University
Tarrant County Water Control District .
Team Bank
Texas Christian University
United Exports Trading Association . .
Vellumoid, Inc
Victoria Savings Association
Western Counties Gas
Industry
Mining
Financial Institution
Water /Sewage
County Government
Municipality
Municipality
Water
County Government
County Government
Electric Generator
County Government
Water
County Government
County Government
County Government
University
University Association
Oil Production
Property Management
Electric Distribution
Electric Distribution
Retail Drug Store Chain
Water, Electricity
County Government
Door Manufacturer
Electric Generation/
Distribution
Private Foundation/
Oil Production
County Government
Electric Distribution
Water Drainage
Electric Generation/
Distribution
County Government
County Government
Electric Distribution
Electric Distribution
Electric Generation
Religious Order
Electric Generation
Electric Generation/
Distribution
University
Water
Financial Institution
University
Duty -Free Wholesale/
Retail Chain
Plastic Manufacturer
Financial Institution
Gas Processor
C
client3.lst
RISK MANAGEMENT GROUP, INC.
Proposal for
Risk Management Consulting Services
for the
City of Round Rock
Prepared by:
Risk Management Group, Inc.
1250 Capital of Texas Hwy. South
Austin, Texas 78746
June, 1991
m■min2 r!
R15K MANAGEMENT GROUP, INC.
TABLE OF CONTENTS
Part A Introduction 1
Part B Proposed Risk Management Services 2
Phase I - Review of Loss Exposures and
Funding Mechanisms
Phase II - Insurance Bidding
Part C Structure of the Work 4
Part D Proposed Fee Structure 6
Part E Biographical Data 7
Part F References 8
RISK MANAGEMENT GROUP, INC.
PART A
INTRODUCTION
Risk Management Group is pleased to provide this proposal for risk
management consulting services for the City of Round Rock
(the City). Before detailing our proposed services, we would like to
give you a brief bit of background about our organization.
Risk Management Group was founded in 1980. Our consultants have
extensive risk management consulting experience and are well versed
in working with public entities in Texas. Each Senior Consultant has
obtained the distinguished "ARM" or "C.P.C.U." professional
designations. The firm and its consultants are licensed to provide
insurance consulting services as required by Texas statutes.
Our client list includes more than 50 firms and organizations located
from Massachusetts to California. On a combined basis, these clients
have properties valued at more than $5 billion, operating revenues of
more than $1 billion and employ more than 21,000 people. These
clients are served by the staff of our Charlotte and Austin offices
as well as personnel from our associate office in Denver.
Risk Management Group is privately owned by the principals of the
firm and is devoted solely to the practice of risk and insurance
management consulting. The principals of the firm are members of the
Society of Risk Management Consultants and fully support the
organization's code of ethics.
The firm does not sell insurance, is not affiliated with any
insurance sales organization, and does not promote a particular
coverage or industry program. Our independent status puts us in the
proper position to provide the unbiased and objective opinions sought
by our clients.
We hope that the City will find our proposal acceptable as we would
welcome the opportunity to be of service.
Page 1
EP Om
K1SK MANAGEMENT OIOUP, INC,
PART B
PROPOSED RISK MANAGEMENT SERVICES
Our goal would be to provide the City with the services detailed
below as Phase I and Phase II in regard to the following areas
of risk:
1. Physical loss of property and the attendant financial loss
that can result. Included in this would be Fire, Boiler
and Machinery, Mobile Equipment, or other Property Damage
insurance programs, as well as Fidelity and Crime insurance
programs.
2. Legal Liability for Personal Injury and Property Damage to
employees and the public. Included within this would be
General Liability, Public Official's Liability, Law
Enforcement Liability, Automobile Liability, and Workers'
Compensation.
Phase I: Review of Loss Exposures and Funding Mechanisms
Upon being retained by the City, we are proposing to review the City's
various exposures to accidental loss. With this information, we can
then evaluate the funding mechanisms currently in place to respond to
these loss exposures. This review will result in an Opinion Letter
with comments in regard to the adequacy of current coverages to
respond to the loss exposures. In addition, the letter will include
recommendations for improvements in coverage and suggested
alternate- funding mechanisms, if applicable.
II: Insurance Bidding
After completing Phase I, it is proposed that we will perform the
following work in connection with the bidding of insurance.
1. In regard to the October 1, 1991 anniversary, we will prepare
insurance bid specifications for the City's property,
liability, workers' compensation, and fidelity insurance
coverage. Specifications will generally follow -
your existing insurance coverages, but can request proposals for
coverage improvements suggested in the Phase I report.
Depending on the results of Phase I, this may include proposals
for "excess coverage" in the event the City may want to consider
certain forms of self- insurance. Coverages outlined in the
specifications will meet statutory requirements.
Page 2 �
RISK MANAGEMENT GROUP, 1NC.
II: Insurance Bidding (continued)
2. The bid specifications will include the necessary underwriting
data, coverage and rating options to obtain competitive bids
from commercial insurance companies through selected
agents /brokers, governmental self- insured "pools" (ie, TML and
TPSF), risk retention groups, and direct - writing insurance
companies. For your consideration, we will recommend markets
known to be competitive.
3. We will assist you by managing the bidding process. In order to
make certain that the proper degree of competition exists
between agents /brokers, we recommend assigning insurance
carriers to the interested agents. This encourages each agent
to strongly negotiate for improved pricing and coverage terms.
We will also handle all inquiries from interested proposers in
regard to the bidding process.
4. We will evaluate the bids /proposals in regard to items such as
the following:
a. Premium Costs,
b. Service Ability,
c. Financial Condition of the Insurer, and
d. Coverage Terms and Conditions.
5. We will review the proposals with the City staff and prepare a
written recommendation to the City. In addition, we will
to make a presentation of the recommendation to the City
Council.
6. We will review the new insurance policies for completeness and
compliance with the bid specifications and the proposals.
7. We will provide the City staff will status reports during this
process to keep the staff advised of key developments.
Page 3
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Au.tamail
RISK MANAGEMENT GROUP. INC.
PART C
STRUCTURE OE WORK
Phase I of our work will be structured in the following order:
1. Upon being retained, we will provide the City with a
detailed list of items we will need to review. Where possible,
this data should be sent to our firm in advance of our
preliminary visit. This list will include insurance policies,
insurance applications, loss information, agreements and
contracts.
2. A preliminary on -site visit will be arranged for the purpose
of:
a. Establishing necessary working relationships between your
personnel and our staff.
b. Conducting an Exposure Review of the City's operations.
3. In our offices, we will review the coverages presently in force
as to their ability to respond to the loss exposures. In
addition, we will review the City's loss history and the
deductible levels. We will also review the calculation of your
insurance premiums and experience modifiers for accuracy.
4. To complete Phase I, we will prepare the Opinion Letter and
review it with the City staff. We will complete the Opinion
Letter within two weeks of being retained by the City.
Phase II will be structured as follows:
1. In addition to a public notice of the bid /proposal process in a
newspaper, we will work with the City staff to determine which
agents, brokers should be invited to participate in the bid
process.
2. We will work with the City staff to finalize a timetable for the
bidding project.
3. We will advise the City of any additional underwriting data not
previously obtained in Phase I.
4. We will assemble the information in our office and prepare
a draft of the specifications.
Page 4
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RISK MANAGEMENT GROUP, INC.
5. We will arrange a follow -up meeting with the City to:
a. Review the draft of bid specifications.
b. Discuss the assignment of markets to agent and brokers.
c. Acquire any remaining support /research data required for
specifications.
6. We will submit bid specifications to markets and respond to
questions raised by vendors during bidding process.
7. Upon receipt of proposals we will prepare a written analysis
including the following;
a. Comparison of policy terms and conditions.
b. Comparison of premiums including cash flow and payment
options.
c. Comparison of support services offered by carriers, i.e.
engineering, claims administration.
d. Analysis of financial strength of carriers.
e. Recommendation for placement of coverage.
8. We will present the written recommendations to the City staff
and City Council and be available to discuss the
recommendations.
9. We will follow with existing and new carriers, agents or brokers
to arrange for the transition of coverage (October 1, 1991
effective date), including the verification of policies and
premiums under the new program.
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RISK MANAGEMENT GROUP, INC.
PART D
PROPOSED FEE STRUCTURE
Risk Management Group proposed to undertake this project for the City
on an actual cost basis subject to a maximum or not -to- exceed amount.
Time records are kept for all consulting personnel and will be made
available upon request. The following schedule is our best estimate
of the time requirements for this project. Tight budgetary controls
are utilized by Risk Management Group to minimize fees for our
clients.
Consulting Fees:
Our fee schedule is as follows:
Principal and Senior Consultant: $105 per billable hour
Staff Consultants: $55 per billable hour
Based on similar projects for other entities, we anticipate that the
project may involve 60 to 90 hours of consulting time. As a result,
we would estimate a consulting fee in•the range of $5,000 to $7,500.
We would agree to a maximum consulting fee of $7,500 for the services
outlined in this proposal.
Miscellaneous Expenses:
In addition to the above fee, the City would be billed for the actual
expenses incurred by Risk Management Group as listed below:
1. The City will be charged for any long distance telephone
expenses incurred by RMG based upon itemized statements of the
charges. These calls will generally be limited to the City's
insurance representatives. We would estimate long distance
calls to be in the range of $30 to $50 for this project.
2. The City will be charged for copying, binding and mailing
expenses in connection with the specifications. These
charges typically run between $8 -12.00 per set of
specifications. As many as ten sets of specifications may be —
prepared.
3. The City will be charged for the cost of photographic film and
development of photos of City property to be included in the
bid specifications. This expense should not exceed $20.00.
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RISK MANAGEMENT GROUT, INC.
PART E
BIOGRAPHICAL DATA
The City of Round Rock will be served by the staff of our Austin
office.
Each Senior Consultant has obtained the distinguished "ARM" or
"C.P.C.U." professional designations. The firm and its consultants
are licensed to provide insurance consulting services as required by
Texas statutes.
By design, Risk Management Group is a relatively small firm in terms
of staff. We have assembled a team of consultants that specialize in
unique areas. As a result, we are able to provide our clients with
experience that is often not available in other consulting firms.
Donald K. Gray, ARM (Senior Consultant) joined the firm in 1988 and
manages the operations of the Texas office. Don prepared for his risk
management career by majoring in Insurance and Risk Management at the
University of Texas - Austin, graduating in 1976. Don's background
includes extensive experience with Texas governmental entities. He
was employed by the Texas A &M University System during 1978 -1983. In
this capacity, he served as the "Manager of Insurance & Retirement
Programs" within the Insurance and Risk Management Department. During
the period of 1983 -1988, Don was employed as the "Director of
Insurance" at the Texas Association of Counties. The Texas
Association of Counties administers several self- insured "pools" for
county governments. The program includes workers' compensation,
property, and liability insurance and is very similar to the TML
program. Annual premiums to the TAC program exceed $40,000,000.
This background with governmental entities gave Don the opportunity to
become very familiar with governmental immunity and the Texas Tort
Claims Act. Our firm uses this knowledge to negotiate for premium
reductions, determine proper liability limits, establish self- insured
programs and advise underwriters. The Texas Political Subdivision
Fund (a state -wide self- insured workers' compensation program)
recently featured Don as a speaker on the topic of Governmental
Immunity & Liability Exposures.
William B. Brown, CPCU, ARM (Principal Consultant) is a 1963 graduate
of the University of North Carolina with a degree in Business. He also
did graduate work at the College of Insurance in New York. Bill works
in both the Austin and Charlotte, N.C. offices. Prior to forming Risk
Management Group, Bill co- founded one of the nations largest risk
management consulting firms (Risk Consultants). Bill was associated
with this firm for eleven years and served as the President. Other
experience includes underwriting and management positions with Chubb.
Bill has authored several risk management papers and has served as a
speaker for several risk management audiences.
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RISK MANAGEMENT GROUP, INC.
PART F
REFERENCES
Please feel free to contact any of the following individuals in regard
to our abilities:
Mr. Neal Haverlah
Risk Manager
Lower Colorado River Authority
Austin, Texas (512) 469 -6876
Mr. Andy Wilkins
Finance Director
City of Denison
Denison, Texas (903) 465 -2720
The Honorable Kenneth Walker
Gregg County Judge
Longview, Texas (903) 236 -8420
Mr. Lyndell Moore
Randall County Auditor
Canyon, Texas (806) 655 -7011
Ms. Jill Estes
Assistant Vice - Chancellor
Texas Christian University
Fort Worth, Texas (817) 921 -7798
Mr. Dan White
Vice President, Financial Administration
St. Mary's University
San Antonio, Texas (512) 436 -3727
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R1SK MANAGEMENT GROUP, INC,