Manatee County Government Administrative Center Commission Chambers, First Floor 9:00 a.m. - May 5, 2015
May 5, 2015 - Regular Meeting
Agenda Item #13

Purchase of Excess Property Insurance


Contact and/or Presenter Information
Mitchell O. Palmer, County Attorney

Action Requested
Motion to (1) approve the purchase of excess property insurance in an amount not to exceed $3,075,238.31 (inclusive of term premium and all Federal/State mandated fees) as shown in the attached proposal from First Florida Insurance Brokers, and (2) authorize the County Attorney or his designee to execute all required documents associated with said purchase.

Enabling/Regulating Authority
Ordinance 08-49

Background Discussion

Annually, 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 2015, and contains the following provisions. The total loss limit per expiring is $250,000,000 which includes a $90,000,000 limit with wind (named storm) and $160,000,000 excluding wind. The named storm deductible is 5% per building and contents, with a minimum named storm deductible of $250,000 with no deductible maximum. 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.

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 $39,096,341 based on a Statement of Value (SOV) which is the value of the county's assets now $1,118,012,198. The SOV sets the basis for determining the “rate per $100 of value”, and ultimately our premium for excess property insurance. Risk Management staff initiated an appraisal in late 2014 to determine insurable value, and obtain critical information used in 'modeling' to determine PML values.  Staff could not determine when the last full appraisal had been done.The result of the appraisal resulted in the TIV increasing from $832,633,076 to $1,118,012,198; an increase of 34.3%.

The proposed excess property insurance program for this renewal contains the following provisions. The total loss limit remains at $250,000,000 which includes a $90,000,000 limit with wind (named storm), which is per expiring, and $75,000,000 in flood coverage, which is also per expiring. The named storm deductible is 5% per building and contents, with a minimum named storm deductible of $250,000.  One enhancement to the program this year includes a named storm deductible cap of $20,000,000, no previous renewal contained this provision. Even with the increased TIV of 34%, and the inclusion of the named storm deductible cap, substantial premium savings have been obtained as shown below.


Excess Property Annual Premium

Rate per

$100 of value

% change rate per $100

$ change in Annual Premium

% change in Annual Premium















The Risk Management Division recommends the Board approve the proposed renewal for our excess property insurance program and approve execution of all required documents.

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 Mitchell O. Palmer County Attorney at mitchell.palmer@mymanatee.org

Cost and Funds Source Account Number and Name
$3,075,238.31 Fund 5050001500-545000 Risk Management General Liability

Amount and Frequency of Recurring Costs
$3,075,238.31 One Time Payment Only

Attachment:  MCBOCC FY16 Ex Prop Proposal revised 04 15 15.pdf