Item 22 - ICRMA JPA Renewal / Broker Agreement / Associated Premiums and Costs

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ICRMA JPA Renewal / Broker Agreement / Associated Premiums and Costs July 19, 2022 Page 2 1 8 0 1 3 b. Workers’ Compensation Buffer Program c. Earth Movement & Flood and Difference in Coverage Program d. Terrorism Insurance Program e. Underground Storage Tank and Environmental Program 5. Authorize the City Manager to approve funding to cover FY 2022/23 City Special Events Insurance for events including but not limited to Fourth of July fireworks show, winter ice-skating events, and other City-sponsored events as created and held, in an amount not to exceed $300,000. 6. Authorize the City Manager to approve the City’s obligation to pay the State of California DIR estimated assessment in the amount not to exceed $500,000 for the period of July 1, 2022 to June 30, 2023. DISCUSSION Staff is recommending renewal with Independent Cities Risk Management Authority (“ICRMA”), a joint powers authority formed in 1980 in accordance with California Government Code Section 6500. ICRMA’s purpose is to provide: i) excess and re- insurance to protect members from extensive financial debt due to large claims, settlements and judgments, ii) group insurance purchasing power that can offer broader coverage at a lower cost, iii) rate stability, and iv) protect individual member cities through pooling of losses, and self-insurance. ICRMA also offers to its’ members actuarial services, appraisal services, safety trainings, claims audits, contract risk transfer consultation, and other miscellaneous services and resources. Currently comprised of 15 California cities, Santa Ana joined ICRMA in July 2019. For this renewal period, The City’s Workers’ Compensation coverage experienced an increase of approximately twelve percent (12%). This program coverage, which had been trending downward for the last two years, experienced this change primarily due to the increased number of claims during 2020 and 2021 related to COVID-19 exposures, testing, and treatment. The City’s premiums for Liability and Property increased approximately twenty-one percent (21%). The significant program increases occurred in coverages for liability, cyber and property primarily due to the following: 1. An insurance market with very few excess carriers willing to quote municipal government entities in California, primarily those with Police departments; 2. A continuing rise in jury awards and settlement amounts; 3. An increasing worldwide number and size of varying cyber-attacks; 4. A rising amount of ADA claims in both cyber and physical environments; and 5. The continual rise in costs for repair and replacement of damaged vehicles, property and equipment.