Loading...
Agenda Item 8AAGENDA ITEM 8A JULY 23 2012 CITY OF ATLANTIC BEACH CITY COMMISSION MEETING STAFF REPORT AGENDA ITEM Insurance Broker of Record for City of Atlantic Beach for Employee Benefits and PropertyCasualty Risk Management Services RFP No 12 02 SUBMITTED BY Susan Danhauser Human Resources Director DATE June 22 2012 RE SUBMITED July 12 2012 REQUEST THAT RECOMMENDATION BE APPROVED AT JULY 23 2012 MEETING DUE TO TIME CONSTRAINTS FOR OBTAINING QUOTES FOR UPCOMING PLAN YEAR OF PROPERTYCASUALTY INSURANCES 100112 BACKGROUND RFP No 12 02 for insurance brokerage services was completed by the City of Atlantic Beach Six firms responded The proposals were evaluated and ranked by the committee on the following service related criteria market knowledge access client knowledge depth and technical knowledge of staff account management scope of services communication performance and strategy The highest possible score was 82 Below is the average score of each firm 1 Harden Associates 770 2 Gallagher Benefit Services 730 3 Brown Brown PRIA 690 4 Green Hazel 655 5 McKinley 650 6 Florida League of Cities 400 Presentations from the top two firms Harden Associates and Gallagher Benefits Services were given to the committee and the City Manager on June 19 and June 20 2012 During these presentations insurance brokerage fees were discussed with the firms The staff recommendation of Harden Associates was based on their proposal score 770 and the fee schedule offered to the City Attached is a letter of clarification from Mr Ceree Harden Chief Executive Officer of Harden Associates regarding Mr Paul Harden Using the projected premiums for the upcoming year the current broker commission rates and the proposed fixed fee rate as basis in the calculation the cost savings is in excess of 16000 per year Although other firms proposed lower fees they were not comparable with Harden Associates for brokerage services offered access to insurance pools depth of local staff and did not offer a three year rate guarantee 1 AGENDA ITEM 8A JULY 23 2012 The following is based on estimated premiums for upcoming plan year Current Brokers Harden Assoc Est Commission Premium Rate Fixed Fee Savings Medical 1056000 6 63360 48000 15360 P L 464000 10 46400 45000 1400 Total 109760 93000 16760 The use of a local firm is imperative to achieve the service level that is strongly preferred Our employees often have questions or claim issues Having a local staff readily available will enable the employees to have their issues resolved quickly and with the least amount of frustration Additionally a local firm that is accessible to the Human Resources department is vital to the administration of the claims billings and resolution of issues Local and regional benchmarking conducted by a firm with clients in the surrounding area is optimal BUDGET Fee rate payment for brokerage service is recommended by the staff The fee is guaranteed for three years and would not fluctuate due to increases in premiums In 2014 healthcare reform will potentially increase the need for additional brokerage services That coupled with the continued rising cost of health and P L insurance the fee based payment for brokerage services will eliminate the Citys exposure to any increase for the next three years The fee rate is guaranteed and all services are included Fee Rates for Top 2 Ranked Firms Harden Gallagher MedicalEmployee Benefits 48000 50000 P L 45000 46400 Guaranteed for 3 years RECOMMENDATION Award a contract to Harden Associates to act as the City of Atlantic Beachs Broker of Record for employee benefits and propertycasualty risk management services and authorize the City Manager to sign the contract to include the above noted fee agreement ATTACHMENTS 1 Proposal Scoring Sheet titled Combined Evaluation Matrix RFP12 02 with rates noted Letter of clarification from Mr Ceree Harden 2 Request for Proposal No 12 02 and Proposals are available for review from City Clerk REVIEWED BY CITY MANAGER 2 Combined Evaluation Matrix RFP 12 02 Each brokerconsultant will be rated on the selection criteria listed below Sample questions have been included as a guide in rating each criterion Points will be totaled from all categories and compared against the maximum score of 82 Scoring 0 Unacceptable 2 Does not meet most expectations 4 Adequate 6 Good 8 Superior Gallagher PRIA Florida Harden Benefit Brown Greene McKinley League Associates Services Brown Hazel Superior of Cities Rating Criteria A Market Knowledge 7 7 7 6 6 4 Does the broker understand the market dynamics for both the benefits and propertycasualty Does the broker have market access to all necessary carriers B Access 8 6 5 8 2 4 Is the brokers team geographically accessible to us Does the broker have secure email for communication C Client Knowledge 7 8 8 5 7 8 Does the broker understand municipalities Can the broker benchmark our cases and benefits with like organizations Do they have a thorough understanding of our goals objectives D Depth of Staff 8 8 6 6 7 8 Does the broker have enough team depth and experience to handle our accounts including claim resolution and employee issues Can the broker shift resources if necessary to meet the nature of our account Can the resources be available on site as needed Open Enrollment Meetings Employee Meetings etc E Technical Knowledge of Staff 8 8 8 75 7 8 Can the broker make us aware of changes in the marketplace that could impact our programs Does the broker have technical expertise in risk management claims analysis health management interpretation of coverage and overall insurance program structure Z to manage our account Does the broker have the expertise to assist in compliance issues Does the broker have the technical competency to deal with industry changes O N co maUaghe PRIA Florida Harden Benefit Brown Greene McKinley League Associates Services Brown Hazel Superior of Cities E Account Management 6 x 7 6 0 Does the broker have a specifically identified team of support staff Do the team member have defined responsibilities Does the model of account management meet our objectives G Scope fServices 8 8 8 7 8 0 Can the broker provide the broad Iist of services lnsurance program audit and review Insurance program specifications Verify all requested new and renewal policy terms Claims advocacy and management meetings Budget planning Benchmarking Health management competency Periodic claims management meetings onineeeahandcumpUanceou Employee communication capabilities cnmmunication o 7 6 7 7 0 Ability tnlisten Response time to client issues Proactive comrnunication on new developments Explanation of technical materials Quality of written documents communications Scheduled regular meetings on risk management Perfnmance s 7 6 6 7 2 Meet deadlines I Effectively explained their program and services Quality nfRnQ submission Possess the financial stability to represent us C Jstrote@y 8 6 5 6 6 4 C Was a strategy Sub 75 71 67 655 63 38 i t Preference isto select asinQrmcapabeufprovidin0asemicewopaneing Add 2 2 2 0 2 2 w TOTAL U7773 69 655 40 Gallagher PRIA Florida Harden Benefit Brown Greene 1 McKinley League Associates Services Brown Hazel 1 Superior of Cities I Please Note Rates were considered from the top 2 firms when making this recommendation 1 11RateswerenotacriteriaintherankingsincetheRFPwasforbrokerageservicesnotarequestforbid k Commission Rates as a of total premium 1 Medical 1 4 6 3 6 1 40 1 3 not disclosed1 P L II 10 10 10 8 15 not disclosed not disclosed Workers Comp 9 not disclosed Fee i Medical j 48000 50000 1 P L and Workers Comp j 45000 46400 11 based on j FY13 est premiums Note Florida League of Cities submitted an incomplete proposal therefore it was only reviewed by the HR Director C C z t c IJ tr 0 g 00 AGENDA ITEM 8A JULY 23 2012 HARDEN July 12 2012 Mr Jim Hanson City Manager City of Atlantic Beach 800 Seminole Road Atlantic Beach FL 32233 Re Clarification of Paul M Harden relationship RFP 12 02 Dear Mr Hanson Thank you for considering our firm to support the insurance risk management and employee benefits objectives of the City of Atlantic Beach I understand there was some confusion with regard to the relationship of Paul M Harden to our firm As we discussed Paul M Harden is neither an employee nor principal of our firm nor has he ever served in such capacity For the record Paul M Harden is engaged in the practice of law unaffiliated with Harden I can assure you that Harden will serve dutifully as your advocate in all matters entrusted to us and that we will appropriately avoid any conflicts of interest Please do not hesitate to call if I can clarify or elaborate on any issues of concern to you or any commissioner Sincerely M C Harden Ill Chief Executive Officer MCH cah cc Susan Danhauser Director of Human Resources 501 Riverside Avenue Suite 1000 Jacksonville FL 32202 9043543785 f 9046341302 hardeninsightcom