Manatee County Government Administrative Center Commission Chambers, First Floor 9:00 a.m. - May 20, 2014
May 20, 2014 - Regular Meeting
Agenda Item #21

Purchase of Excess Property Insurance


Contact and/or Presenter Information

Raymond Carter, Risk Manager, ext. 3782

Action Requested

Motion to approve the purchase of excess property insurance in an amount not to exceed $3,240,171 (inclusive of term premium and all Federal/State mandated fees) as shown in the attached proposal from First Florida Insurance Brokers, and to approve the County Attorney or his designee executing all required documents.

Enabling/Regulating Authority

Ordinance 08-49

Background Discussion

The Board of County Commissioners of Manatee County purchases excess property insurance to protect the County’s real and personal property assets against losses caused by natural and man-made perils. Manatee County maintains an insurance program to protect its buildings against catastrophic financial loss. There are two parts to this program; property insurance and flood insurance, the combination of which are intended to comply with Section 311 of the Stafford Act (42 U.S.C 5154). The Stafford Act requires that an applicant for Federal FEMA assistance “shall comply with regulations prescribed by the President to assure that, with respect to any property to be replaced, restored, repaired, or constructed with such assistance, such types and extent of insurance will be obtained and maintained as may be reasonably available, adequate, and necessary, to protect against future loss to such property.”

The current excess property insurance program expires on June 1st 2014, and contains the following provisions. The total loss limit per expiring is $250,000,000 which includes a $60,000,000 limit with wind (named storm) and $190,000,000 excluding wind. The named storm deductible is 5% per building and contents, with a minimum named storm deductible of $250,000. For all other perils the deductible is $100,000 per occurrence. The County purchases primary flood coverage on select properties through the National Flood Insurance Program (NFIP) on properties in special flood hazard zones. The expiring excess property insurance program provides $50,000,000 of flood coverage in excess of the NFIP coverage of $500,000 per building maximum.

One of the methods for determining rates, and risk, is the use of catastrophic modeling programs to determine the Probable Maximum Loss (PML), which is the anticipated loss from the destruction or loss of use of the property.  The PML for the 100 year storm was determined to be $45,989,694 based on a Statement of Value (SOV), which shows the County’s insurable values of $796,003,058; however, this PML does not include the Lake Manatee Dam in this loss estimate. The SOV sets the basis for determining the “rate per $100 of value”, and ultimately our premium for excess property insurance. The Lake Manatee Dam policy which also expires on June 1, 2014, with an accompanying premium of $270,499 and an associated value of roughly $36,600,000. At staff’s direction the Property program was marketed to the insurance underwriters to include the Lake Manatee Dam, raising the SOV to $832,633,076.

The proposed excess property insurance program for this renewal contains the following provisions. The total loss limit of $250,000,000 which includes a $90,000,000 limit with wind (named storm), which is a $30,000,000 increase in wind coverage per expiring, and $75,000,000 in flood coverage, which is a $25,000,000 increase in flood coverage per expiring. Even with the increased coverages negotiated, and the inclusion of the Lake Manatee Dam in the excess property program, substantial premium savings have been obtained as shown below.


Excess Property and Lake Manatee Dam Annual Premium

Rate per $100 of value

% change rate

per $100

$ change in Annual Premium

% change in Annual Premium

Expiring Program






Proposed Renewal






The Risk Management Division recommends the Board approve the proposed renewal for our excess property insurance program.

County Attorney Review
Not Reviewed (No apparent legal issues)

Explanation of Other

Reviewing Attorney

Instructions to Board Records

Please return a stamped copy of this Agenda Memorandum certifying its approval by the Board of County Commissioners to Raymond Carter – County Attorney’s Office – raymond.carter@mymanatee.org.

Cost and Funds Source Account Number and Name
$3,240,171 Fund 5050001500 Risk Management General Liability

Amount and Frequency of Recurring Costs
$3,240,171 One Time Payment

Attachment:  MCBOCC FY15 Ex Prop Proposal 4.23.14.pdf