HomeMy WebLinkAboutResolutions - 1990.12.13 - 18228INC RESOLUTION EBY APPROVE TJIE FORE
lel T. Murphy, Co n Execu
December 13, 1990
MISCELLANEOUS RESOLUTION #90285
BY: FINANCE COMMITTEE, DR. G. WILLIAM CADDELL, CHAIRPERSON
IN RE: RISK MANAGEMENT - GALLAGHER BASSETT 1991 CONTRACT ADDENDUM
TO THE OAKLAND COUNTY BOARD OF COMMISSIONERS
Mr. Chairperson, Ladies and Gentlemen:
WHEREAS Miscellaneous Resolution #89300 approved a contract between
Oakland County and Gallagher Bassett for risk management services, claims
reporting, and loss prevention, etc.; and
WHEREAS Risk Management has recommended the contract extension for the
period December 15, 1990 - December 15, 1991 at an estimated cost of $47,890
for claims management, loss prevention, Risx Facs and system charges; and
WHEREAS the 1990/91 County Building and Liability Insurance Fund has
budgeted funds for this purpose.
NOW THEREFORE BE IT RESOLVED the Board of Commissioners approves
extension of the contract with Gallagher Bassett through December 15, 1991.
Mr. Chairperson, on behalf of the Finance Committee, I recommend the
adoption of the foregoing resolution.
FINANCE COMMITTEE
nf7/no9021mr
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- 42
OCT. 9 -4 4. ior ,
Nj Uatt,
• Vol.,
e. Loss Prevention Services $20,000 ($10,000* billed
in deposit)
ADDENDUM #3 (B)
TO
AGREEMENT FOR SERVICES
BETWEEN
COUNTY OF OAKLAND, MICHIGAN
AND
GALLAGHER BASSETT SERVICES, INC.
PERIOD OF AGREEMENT: December 15, 1987 - Continuous
DATE OF CHANGE: December 15. 1990
It is hereby noted and agreed that Item IV (AGREEMENT), Section B (Obligations of the
CLIENT), is amended as follows:
B. Obliaations of the CLIENT
1. CLIENT shall pay GB for services rendered herein an annual deposit of
THIRTY-SEVEN THOUSAND EIGHT HUNDRED NINETY DOLLARS
($37,890.00) to be billed quarterly.
This sum includes program charges consisting of:
a. RISX-FACST and Systems Charge $2,717
b. Claims Management Charge (minimum
based on a rate of $425 per claim for
45 claims) $19,125
c. Claims Management Administration Charge $6,064
• Settlement Authority $2,200
Meeting -
• Index Bureau $258
• Loss Notices per request $240
• Topical Captioned Reports, $5,000 $350
• Acct. Coord. $1,628
• Meetings $1,388
d. SIMMS Credit ($16)
$37,890
The aforementioned claims management charge is subject to an audit of
reported claims at the end of twelve (12) months. The CLIENT will be
surcharged FOUR HUNDRED TWENTY FIVE DOLLARS ($425.00) per
claim for each claim reported in excess of 45 claims.
LAM LIE,Adcit3
Loss Prevention services as set forth in Appendix A to the Agreement for
Services for the period of December 15, 1987 through December 14,
1988 no longer apply.
The $20,000 Loss Prevention fee (as shown on page 1 of this
Addendum) is the anticipated projected amount of LP services for the
year. The $10,000 deposit is not a minimum fee but is subject to
adjustment based upon the hourly rates shown. For the period of
agreement covered by this Addendum #3 (December 15, 1990 through
December 14, 1991), Loss Prevention services are available upon
request of the CLIENT and will be rendered as staff is available. Loss
Prevention services will be billed at the rate of ONE HUNDRED ONE
DOLLARS ($101.00) per hour plus expenses for an Executive Manager
or for Industrial Hygiene services and billed at the rate of SEVENTY-
FOUR DOLLARS ($74.00) per hour plus expenses for all other
representatives.
Payment terms are twenty-five percent (25%) down and the balance in
three (3) quarterly installments and documentation for these charges will
be provided by GB.
2. CLIENT shall at all times provide funds adequate for the payment of
qualified claims or losses and of allocated loss expenses. For this
purpose, allocated loss expenses shall mean all costs, charges or
expenses of third parties incurred by GB, its agents or its employees,
which are properly chargeable to a qualified claim or loss including,
without limitation, court costs, fees and expenses of attorneys,
independent investigators, experts and witnesses, and fees for obtaining
diagrams, reports, documents, photographs, surveillance and
automobile appraisals.
GB will provide an on-line check issuance and banking communication
system known as "APACS," which provides for automated payments and
control. Operational costs for this system will be charged to the CLIENT.
This will include such charges as check costs, wire transfer fees, bank
reconciliation reports and overdraft charges. All earning credits on
imprest funds will be credited to the CLIENT. The account will be funded
with Citibank to administer a SIMMS cash management program. Such
cash management program will deal directly with the funding program of
the CLIENT's banking funding. GB will conduct an audit at the end of
eighteen (18) months after actual costs are known and will furnish the
CLIENT with the proper debit or credit. In addition, GB will analyze the
account from time to time and will submit advisory reports and
recommended adjustments to the imprest balance.
Failure or refusal to provide such funding at the time of cancellation or
nonrenewal will result in "stop payment" orders being placed on all
outstanding payments. The cost of placing such "stop payment" orders
or any other expense resulting from the failure to provide the proper
funding will be the obligation of the CLIENT.
1&M1L1EAddS3
3. It is expressly understood that GB shall not be required to advance its
own funds to pay losses, allocated loss expenses or banking charges
hereunder, or to perform any services hereunder if CLIENT fails to
provide adequate funds as herein set forth."
All other terms and conditions remain unchanged.
DATED THIS DAY OF , A.D. 1990.
COUNTY OF OAKLAND, MICHIGAN
By:
Title:
GALLAGHER BASSETT SERVICES, INC.
By:
JACK H. LAZZARO, VICE PRESIDENT FINANCE
L&M F_IE AddS3
Resolution # 90285 December 13, 1990 .
Moved by Caddell supported by Ferrens the resolution be adopted.
AYES: Gosling, Huntoon, Jensen, Johnson, R. Kuhn, Law, Luxon, McConnell,
McCulloch, McPherson, Moffitt, Oaks, Olsen, Pappageorge, Pernick, Price, Rewold,
Skarritt, Aaron, Caddell, Calandro, Chester, Crake, Ferrens. (24)
NAYS: None. (0)
A sufficient majority having voted therefor, the resolution was adopted.
STATE OF MICHIGAN)
COUNTY OF OAKLAND
I, Lynn D. Allen, Clerk of the County of Oakland, do hereby certify that the foregoing
resolution is a true and accurate copy of a resolution adopted by the Oakland County
Board of Commissioners on December 13, 1990
with the original record thereof now remaining in my office.
In Testimony Whereof, I have hereunto satiny hand and affixed the seal of the County
of Oakland at Pontiac, Michigan this 13th day 16) Aecember
/7/
,i? 1991L
—
Lyno/D. Allen, County Clerk
k!V,_
-4 -1V-114-6199n- U
COUN y n•n A LT'
ADDENDUM TO GALLAGHER BASSETT CONTRACT
November 2, 1990
STANLEY B. FAYNE, Risk Manager
JACK C. HAYS, Corporation Counsel
DEPT.:_ RISK MANAGEMENT & SAFETY
Initial Revision # Extension Final Other
Disapproved* Approved
CONTRACT/PROGRAM REVIEW REQUEST
1111.n .3
DATE:
TO:
FROM:
TITLE/SUBJECT:_
FILE #:
CONTACT PERSON: STANLEY B. FAYNE TELEPHONE #: 85264
STATUS (Check appropriate box)
It "other" is checked, please explain:_
No
Disapproved*
Board Resolution Required?
ESNLJEPT
FT] Approved [
Yes - Resolution
Modify* Date:_ _11/V7` Signature
Date:
CORPORATION COUNSEL:
As to legal sufficiency
Approved
only--not content.
1 Modify* Date: 11/2/90 Signature: V -
/ '
X Disapproved*
RISE MANAGEMENT & SAFETY: Cr-LA94.
(7-
Modify* Date: ///42 Signature: —f44-412
MANAGEMENT AND BUDGET:
Approved n Disapproved*
CO4TRACT[PR0GRAM SYNOPSIS:
Modify* Date: //""Ci-1)(3 Signature: /
*When Disapproved is Noted or Modification is Requested, Attach Explanation
Daniel T. Murphy, Oakland County Executive COUNTY MICHIGAN
RISK MANAGEMENT AND SAFETY • Stanley B. Fayne, Risk Manager
DATE: October 30, 1989
TO: G. William Caddell, D.C.
Chairperson, Finance Committee
FROM: Stanley B. Fayne
Risk Manager
SUBJECT: Gallagher Bassett Contract Extension
You may recall that in 1986 the following services and charges were
approved for 1986-1987:
$ 34,000
42,259
7,300
4,884
3,500
113,425
Risk Management Services
Claims Management (Based on 125 claims;
each claim over 125 at $293)
Record Only (500 claims at $14.60 each)
Risx Facs and Systems Charges
Claims Management Administration
Loss Prevention (1010 hours at $92.50 an hour,
additional $20,000 administrative cost.)
$205,368
The 1987-1988 contract was reduced after negotiations by $93,623
as itemized below:
Risk Management Services $ 15,000
Claims Management (Based on 85 claims;
each claim over 85 at $260) 22,100
Risx Facs and Systems Charges 4,365
Claims Management Administration 3,500
Loss Prevention (maximum of 699 hours at $78 per hour) 54,222
SIMMS Deposit 800
Micro Fax (if available) 2,750
Record Only (Based on 250 claims;
each claim over 250 at $18) 4,500
Actuarial Services, if incurred 5,000
$112,237
Executive Office Building • 1200 North Telegraph Road • Pontiac, Michigan 48341-1043 • (313) 858-5264
b.
G. William Caddell
October 30, 1990
Page 2
In keeping with the Risk Management department's objectives, we
further substantially reduced the activities of Gallagher Bassett in
1988-1989 in order to reduce costs. The 1988-1989 contract costs were:
Risk Management Services
Claims Management (Based on 55 claims;
each claim over 55 at $293)
Risx Facs and Systems Charges
Claims Management Administration
Loss Prevention
SIMMS Deposit
Record Only (Based on 37 claims;
each claim over 37 at $28)
Actuarial Services
$ 7,500 1
2 20,6252 4,2452 2,5003 25,0002 1,645
1,0362
5,0001
$ 67,551
The 1989-1990 contract extensicn produced the following renewal
pricing:
Risk Management Services
Claims Management (based on 43 claims at $375 each;
each claim over 43 at $375)
Risx Facs and Systems Charges
Claims Management Administration
Loss Prevention
SIMMS Deposit
Record Only (5 claims at $28 each;
each claim over 5 at $28)
Liability Claims Review Audit
Preparation for Actuarial study
7,500 1
16,1252
4,41
25,0003
2 (208)
1402
8,0001
$ 63,640
Not included in annual deposit. To be billed on a time and expense
basis as incurred.
2 Included in annual deposit.
3 Only $10,000 to be included in annual deposit. Over $10,000 to
be billed on a time and expense basis as incurred.
G. William Cadden
October 30, 1990
Page 3
We propose that the 1990-91 Gallagher Bassett services be further
reduced as follows:
Claims Management (based on 45 claims at $425 each;
each claim over 45 at $425)
Risx Facs and Systems Charges
Claims Management Administration
Loss Prevention
SIMMS Credit
19,125 1
2,717 1
6,064 1
20,000 2
1 (16)
47,890
The above pricing includes claims meetings and Cleveland Index Bureau
inquiries, topical reports and account coordination. The Index Bureau
provides information to us concerning any previous claims/lawsuits which
have been brought by the present plaintiff.
The cost reduction from last year contemplates Risk Management and
Safety performing additional claims investigations and loss control in-
house. I have had discussions with Gallagher Bassett and they are aware
that we are contemplating handling as much field investigation as possible
in-house and that Oakland County would expect further prorata price reductions.
It is my estimation, based on current requirements and us doing a number of
in-house field investigations, the final cost of the contract for 1990-1991
will be on the order of $40,000. It is respectfully recommended that the
contract extension be approved as the most cost effective way to proceed
at this point in time with a subsequent recommendation to follow on staffing
for our in-house claims investigations and loss control activities.
We have previously sent to Corporation Counsel a copy of the contract
addendum to review for legal form. The basic contract had also been pre-
viously reviewed and approved as to its legal form and content by the
office of Corporation Counsel.
SBF/bls
Enc.
cc: Daniel T. Murphy, County Executive
Kenneth Q. Burchill, Deputy County Executive
1 Included in annual deposit.
2 Only $10,000 to be included in annual deposit. Over $10,000 to
be billed on a time and expense basis as incurred.