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HomeMy WebLinkAboutRESPONSE - RFP - P895 INSURANCE 5 YEAR BID (4)a tli-P Arthur J. Gallagher & Co. - Denver July 24, 2003 Mr. James B. O'Neill II, CPPO, FNIGP Director of Purchasing & Risk Management City of Fort Collins 215 North Mason Street, 2"d Floor Fort Collins, CO 80524 RE: Response to Request for Proposals # P-895 Property and Liability Insurance Agent/Broker Dear Mr. O'Neill, Enclosed is our response (1 original and 4 copies) to the captioned RFP with regard to the City of Fort Collins Property and Liability insurance portfolio and on -going risk management and support services. We have thoroughly reviewed this proposal; specifically the items outlined in the "Scope of Work." We are committed to providing the services outlined and have a dedicated team of qualified individuals who will be assigned to your account. As required, we have enclosed the signed Submittal Page and acknowledgment of receipt of Addendum 1 to this RFP in our response. In addition, we feel the benefits of working with us are: ♦ We work in partnership with our clients to provide superior services. ♦ Our extensive hands-on experience working with many cities, counties, schools, pools, colleges and universities in designing, marketing risk transfer structures that are compatible with the mission and vision of our clients. ♦ Our highly experienced and dedicated personnel who specifically specialize in the public/scholastic sector. Thank you for giving us the opportunity to participate in this RFP process. Please let me know if you have any questions after your review of our proposal. We look forward to participating in the next phase of this process. Sincerely, ARTHUR . GALLAGHER & CO: DENVER Karen L. Graham, CIC, A -P Area Vice President Enclosures 7900 East Union Avenue, Suite 200 Denver, CO 80237-2737 303.773.9999 Fax 303.773.9776 Toll Free 800.333.3231 www.ajg.com iACITY OF FORT COLLINS In addition to the references provided, following is a partial list of our public entity clients. Premiums range from $30,000 to $3,000,000. CLIENT CLIENT SINCE LINES OF COVERAGE Adams County, CO 1977 Property, EB, WC Aurora Public Schools 1986 Property, EB, Crime City and County of Broomfield, CO 2003 WC City of Arvada, CO 1990 All Lines City of Aurora, CO 1978 All Lines City of Boulder, CO 1986 All Lines City of Renton, WA 1989 All Lines Denver Regional Council of Governments 2001 All Lines Fire & Police Pension Association 1997 All Lines State of Wyoming 1999 Casualty, Crime, & Aviation Weld County, CO 1993 WC & Bonds We provide Risk Analysis, Retention Analysis, Insurance Marketing, Program Administration and Design, Claim and Loss Control Assistance to all of these clients. Coverages vary by entity. Following are the most common coverages provided to our Public Entity business: property, builders' risk, equipment breakdown (EB), crime, fiduciary, general liability, automobile liability, law enforcement legal liability, airport and aircraft liability, public officials liability, workers compensation (first dollar and excess) and surety bonds. The risk financing transfer on these accounts range from the traditional "first dollar" product to an excess and/or reinsurance basis. Arthur J. Gallagher & Co. Response to RFP MAClient.dw\FTCOLLIN%RFP\FC 03 RFP.doc Page 3 ® CITY OF FORT COLLINS 3. (Describe any special expertise your firm has in providing insurance brokerage services to a City). Does your company have any proprietary programs for government entities? How would the existence of such a program affect your firm's objectivity in the marketing of the City's insurance program? nique to Gallagher is our focus on Niche Specialties; we do not attempt to be "all things to all people". Rather, as evidenced by our Niche Initiative in 1996, we commit corporate resources to support local offices in the development of expertise and revenue growth (market share) in specific business sectors. The Public Entity Division is one of eleven identified Niche Specialties where we have significant presence and are committed to continued growth. Specializing in the Public Sector has allowed our staff, the staff assigned to your account, to concentrate on the exposures and risks of this sector. We are committed to, and have established relationships with, the various markets that also specialize in providing insurance coverage to the Public Sector. We understand the coverage and forms not only needed by this sector, but being offered by the various insurance companies. The insurance industry is cyclical and as you know, we are currently in a "restoration stage" on the heels of "hard market" conditions. In order to obtain the most competitive terms for the City, we pride ourselves in presenting the City, its exposure and loss history, in the best light to underwriters. Because we understand the City's exposures, the Colorado Governmental Immunity Act; the information and format underwriters require; we have the ability to obtain the most competitive and comprehensive terms available. Our niche group meets bi-annually to keep us abreast of current events in our industry. This includes updates and discussion on the financial performance of various insurance companies and their current appetite for Public Sector business, emerging risks, coverage updates, new exclusions (terrorism, mold), etc. This allows our staff to be on the cutting edge of what is happening in this sector across the US. Our niche group also allows us to pull from the expertise and resources of our national parent as well as our peer group throughout the entire organization. With regard to proprietary programs for government entities, yes, we do have two major programs. Locally, we formed and administer the Colorado Public Entity Risk Purchasing Group, a risk purchasing group domiciled in Colorado and formed pursuant to the Federal Risk Retention Act of 1986, 15 U.S.C. 3901 et seq. Authority to operate in Colorado is granted under C.R.S. 2-1-8. ArthurJ. Gallagher & Co. Response to RFP MdClientdo \FTCOLLIN\RFRFC 03 RFP.doc Page 4 CITY OF FORT COLLINS The purpose of the risk -purchasing group is to utilize the purchasing power of its members in negotiating favorable terms, conditions, pricing, and profit sharing provisions in the excess casualty contracts obtained by members. The City is currently a member of this group and will be receiving a total of $32,982 back from Genesis insurance company for its 2003 profit share payout and an estimated amount of $33,168 for the 2004 profit share payout. An illustration of the payout for these two years is included in Exhibits. Corporately, we also developed and manage the Gallagher Premier Public Entity Package. This product provides all lines of coverage on a package policy basis with an annual aggregate. Although these programs do show "our commitment to" and "knowledge of" the Public Entity Sector, they do not fit every public entity client. We offer these programs if they are "a fit" providing comprehensive coverage and competitive pricing but we are not required to quote these programs nor do we receive any special compensation or privilege for placing coverage through these programs. 4. What markets would you most likely approach, in order of preference, if chosen? DO NOT TIE UP MARKETS AT THIS TIME. Please provide a prospectus and financial rating of these markets. Refer to Exhibits for Market Preferences. 5. Your qualifications to handle the City's insurance portfolio and capabilities for risk management services. a. Describe your office, its history, and how it works with the national office (or offices), if appropriate. Please identify all activities that are performed by the national office. ormed in 1927, Arthur). Gallagher & Co. has grown to the third largest insurance brokerage and consulting firm in the nation and the fourth largest in the world, providing all forms of property/casualty and employee benefit products and services through an organization of specialized companies in the U.S. and abroad. Our eight decades of profitable growth have been achieved through responsive customer service and a pioneering approach in the design and implementation of insurance, reinsurance, risk management and self-insurance programs. A strong team spirit, continuing product and service innovation, solid professional development programs and strategic technological advances ensure that we will fully perform for our client partners. Gallagher has long been Arthur). Gallagher & Co. Response to RFP MAClient.do \FTCOLLIN\RFRFC 03 RFP.dx Page 5 CITY OF FORT COLLINS recognized as a leader in the development of trend -setting risk management, risk transfer, and risk financing products and service techniques. We invite you to visit our web site at www.ajg.com and review The Gallagher Group of Companies shown in the Exhibits section. Narrowing our focus to the public entity sector, Gallagher derives over 40% of its corporate revenue by providing risk management services to this market segment. Nationally, we provide services to over 6,000 public entities, encompassing over 700,000 employees and $120 billion in property values. We have a corporate commitment to this market segment and our expanding client list, market relationships and personnel reflect that commitment. In 1957, Gallagher took over the Beatrice Foods, Inc. account and designed a state-of-the- art insurance program for Beatrice. This included pioneering the first retrospective policy and large -deductible property policy. However, the most significant change was the creation of the first self-insurance program in the insurance industry —the beginning of the alternative market. Beatrice wanted to control more of its costs. Gallagher helped Beatrice achieve its goal by introducing the self-insurance concept to Beatrice. This allowed Beatrice significant advantages of creating and controlling their own risk -protection programs. Beatrice left the "traditional" insurance market for the new self-insurance program in March 1963. Through this process, Gallagher's subsidiary company was born — Gallagher Bassett Services, Inc., a third -party claims administrator. When Beatrice became self -insured, this changed forever both Gallagher and the landscape of commercial insurance. Gallagher began to carve out a niche as a major supplier, and significant developer, of the alternative risk market. In the early 1970's, Gallagher designed the first multi -line "protected self-insurance" program (a single policy providing both specific and aggregate protection). This concept was the genesis of our phenomenal growth through the 1970s and 1980s. We continue to be innovators in the alternative risk market, and today our self -insured clients number in the thousands. Today, Gallagher is a full -service international broker, dedicated to providing superior risk management products and services. For the year-end December 31, 2002 our corporate revenue was in excess of $1 billion. Our worldwide employee count is over 6,500 employees in 185 offices. We are publicly traded on the New York Stock Exchange (symbol AJG). Arthur J. Gallagher & Co. Response to RFP M:\C1ient.do6FTC0LLIN\RFNFC 03 RFPAd Page 6 CITY OF FORT COLLINS Citvof FmlC Ine LOCAL OFFICE BACKGROUND The Denver office of Gallagher opened in 1975 and currently has a staff of forty insurance professionals. Over 60% of our branch revenue is derived from servicing large, complex and multi -faceted accounts with premiums over $1 million. The local Gallagher office operates autonomously but can draw upon all the resources of our national parent. All Gallagher employees are connected electronically. We have a national database that provides the latest and most up-to-date information on risk management issues for Public Entities. Our National Public Entity and Scholastic Niche Practice Group provide another resource we utilize for our governmental and municipal clients. Arthur J. Gallagher writes more governmental business as a percentage of our total book than any other broker. We are familiar with public entity exposures, serving over thirty municipal and three public entity pools from this branch. The Denver office is the broker for numerous cities, counties, states, school districts, colleges, and universities. The Denver Branch is the office that will handle the City's account and we are located in the Denver Tech Center, 7900 East Union Avenue, Suite 200, Denver, Colorado. As of December 31, 2002, property/casualty premium volume is in excess of $60 million and gross revenues are approximately $6.9 million. Current premium volume for public entities is more than $18 million. AREAS OF EXPERTISE ■ Public Entity ■ Aviation ■ Environmental ■ Construction Management ■ Dedicated national and niche groups ■ Individuals dedicated to your market segment ■ Reinsurance placements ■ Excess of loss placements ■ Casualty and Property Claim resources ■ Manuscript coverage documents ■ Client service focus ■ Resources focused on claims management and risk control services ■ Proprietary products and services designed to meet changing risk management needs of public entities ■ Catastrophe Modeling ■ Probable Maximum Loss Reports (PML) Arthur J. Gallagher & Co. Response to RFP MAClient.da \FTCOLLIN\RFRFC 03 RFP.doc Page 7 CITY OF FORT COLLINS CltvoEFoet Colons ARTHUR 1. GALLAGHER U CO. - DENVER ■ Service over 30 public entity risks and 3 public entity pool accounts ■ Aviation ■ Staff dedicated to Public Entity Sector - we are a significant member of the National Public Entity and Scholastic Division ■ Expertise in coverage design and marketing large municipal property risks ■ Reinsurance placements ■ Excess of loss placements ■ Loss control and claim resources ■ Dedicated customer service ARTHUR ). GALLAGHER & CO. - NATIONALLY ■ Service over 6,000 public entities ■ Dedicated niche groups throughout country ■ Conducted training sessions for: ■ Public Risk Insurance Management Association (PRIMA) ■ Government Risk Management Seminar (GRMS) ■ Risk and Insurance Management Society (RIMS) ■ Sponsored the National "State of Risk Management" Study for National PRIMA (published 2000) ■ Recognized national and regional expertise — speakers for RIMS/PRIMA ■ Sponsor client "focus group" meetings across the country to discuss risk identification, risks of the future, the job you do, and the broker -client relationship. Results presented at National PRIMA 2001 • National loss control and claim resources ■ Catastrophe Modeling ■ Probable Maximum Loss Reports (PML) ■ Property Engineers Arthur J. Gallagher & Co. Response to RFP MACFent.doffTC0LLIN\RFRFC03 RFPAd Page 8 CITY OF FORT COLLINS The primary function of our corporate office is to provide additional resources to our branches and their clients on an as needed basis. An example of these resources are: ■ Monitoring the financial security of the insurance companies ■ Monitoring product availability and carrier appetite of insurance companies that are committed to the public entity sector ■ Preparing white papers on various coverage issues and emerging risk ■ Following Federal and State legislature and various lawsuits that can effect this sector ■ Continuing new product development ■ Offering claim and loss control advocacy Special projects such as probable maximum loss (PML) reports, catastrophe modeling, disaster recovery plans, etc. would be performed on a time and expense basis negotiated outside of our fee. b. Provide the names, qualifications, and location of each individual that would be assigned to the City's account. We recognize that market access, corporate resources and technical expertise, are only as good as the people who coordinate the delivery and management of these services. Your account will be serviced and coordinated by our Public Entity department in Denver under the leadership of Karen Graham, Area Vice President and primary backup, Ty Pixler, Senior Account Manager. The following Service Team has been assembled specifically to service the needs and requirements of the City of Fort Collins. Included is a team chart as well as a brief description of the individuals and their roles on the City's account. Professional Profiles are included in the Exhibits. Arthur J. Gallagher & Co. Response to RFP MACRent.dorAFTCOLLIN\RFRFC 03 RFPAd Page 9 ® CITY OF FORT COLLINS aW oLFat Co01ns ACCOUNT MANAGEMENT TEAM Karen L. Graham, CIC, ARM-P, Area Vice President, has been assigned as the primary Account Executive and Team Leader on your account. Karen has twenty-seven years experience in the insurance industry, with the last eleven solely dedicated to public sector risk management. In this role she is responsible for: ■ Managing the Denver Branch Public Entity/Scholastic Division, which includes an estimated premium volume of $18 million for approximately thirty accounts ■ Implementing strategic risk management plans ■ Policy design ■ Communicating with Risk Management on special projects, work plans, and other relevant management issues ■ Attending client meetings, including providing reports and presentations ■ Insuring the quality of Gallagher's service ■ Negotiating reinsurance / insurance coverages ■ Overseeing and directing your account management team ■ Coordinating Gallagher resources Ty Pixler, Senior Account Manager, supports the Account Executive and will assist in marketing, reviewing, and maintenance of the City's insurance / reinsurance portfolio. She will coordinate the day-to-day services of the technical staff in servicing your account. Ty will also attend client meetings as requested. Through over nine years experience in the insurance industry, Ty has acquired strengths in many areas, such as: ■ Risk management services ■ Scholastic risks ■ Public entity and governmental risks (including pools) ■ Surety bonding Bobbie Taylor, Account Representative, is responsible for providing day-to-day services. This includes: ■ Issuing certificates ■ Issuing binders, invoices ■ Collecting underwriting data ■ Marketing ancillary coverage lines ■ Maintaining underwriting schedules ■ Processing endorsements Arthur J. Gallagher & Co. Response to RFP M:\Client.doc\FTCOLLIN\RFRFC 03 RFP.doc Page 10 CITY OF FORT COLLINS RISK CONTROL SERVICE TEAM Our Risk Control Service Team is comprised of individuals from both the Denver, CO and Itasca, IL offices. Below are both the Denver and Itasca team members: Kim Bills, Claim Manager, is our in-house advocate in claim issues. She has over 15 years experience in claims, loss control, risk management, data systems, client services and account management. Her responsibilities include: ■ Working closely with the account executive and account manager to coordinate claims services on behalf of the City. ■ Providing claims supervision as required. ■ Ensuring claims are noticed to the proper carrier, or multiple carriers if more than one policy responds. ■ Advising and assisting with pre- and post -loss analysis and damage mitigation, to include investigations, preservation of evidence, defensive posturing, and negotiation of resolutions. ■ As the City's advocate, applying claims expertise in oversight, management, and influence over carrier activity. ■ Claims reviews and audits on a schedule predicated on the needs of the business. Matthew Krell, Risk Control Consultant, is our in-house risk control consultant and certified safety professional. He is available to work with the City to: ■ Assess current risk control practices ■ Design strategic risk control plans ■ Provide risk control services on a direct basis ■ Coordinate insurance company activities to achieve defined objectives Arthur J. Gallagher & Co. Response to RFP MAClient.do \FTC0LUN\RFRFC03 RFP.dm Page 11 CITY OF FORT COLLINS Barbara Galluppi and Jim Krueger, Liability and Property Claims Advocates, located in our Itasca, IL office are available to consult with The City of Fort Collins, attorneys and adjusters on claim issues. In addition, they can assist you in: ■ Facilitating recoveries from insurance carriers ■ Deploying and controlling insurance company adjusters ■ Developing proof of loss statements ■ Validating Business Income and Extra Expense losses ■ Assuring a prompt settlement process Wayne Onyx, HPR Property Engineer, located in our Itasca, IL office, is available to consult on property engineering needs, review building plans and perform Probable Maximum Loss (PML) reports and Catastrophe Modeling (CAT Perils). PROBABLE MAXIMUM LOSS REPORTS (PML) A PML can be provided for both Property Damage (real and personal) and Time Element (business interruption and extra expense) based upon an on -site survey. A full property Loss Control Report can be provided quantifying the PML from a Fire, Time Element and Difference In Condition (DIC) perspective, e.g., flood and earthquake exposures. This comprehensive PML report is specific to a given location and serves as an adjunct to the CAT modeling of the entire risk / campus. In addition to providing PML's, the report contains conservation commentary, COPE exposure ratings and loss control recommendations in accordance with NFPA or other desired industry standards to aid in property conservation practices and procedures. Coverage limits and terms are structures / recommended to adequately protect the insured's interests based on the determined PML's. CATASTROPHE MODELING (CAT PERILS) In addition to PML loss control reports issued for individual locations, we will provide a "CAT" analysis based upon scientific data and current empirical industry models designed and approved by structural engineers, geologists, seismologists, meteorologists, and geotechnical specialists. This comprehensive report performed by Specialty Catastrophe Services, Inc., includes a property exposure summary and probably maximum losses from various CAT perils based upon various assumptions and the profile of your risk from windstorm, hail / tornado, earthquake, flood, subsidence, etc. The report quantifies critical probabilities that estimate the magnitude of loss to property and from time elements that may occur in the event of such natural hazards. CAT modeling reports are often used in the insurance coverage procurement and structure. See Exhibits for sample report. Arthur J. Gallagher & Co. Response to RFP MACUent.duciFTCOLLIN\RFRFC 03 RFPAd Page 12 RESPONSE TO REQUEST FOR PROPOSAL FOR PROPERTY AND LIABILITY INSURANCE AGENT / BROKER RFP 0895-INSURANCE PREPARED FOR City of Fort Collins JULY 25, 2003 SUBMITTED BY: KAREN GRAHAM, CIC, ARM-P, AREA VICE PRESIDENT KARE N_G RAHAM@AJG.COM ARTHUR J. GALLAGHER & CO. - DENVER 7900 EAST UNION AVENUE, SUITE 200 DENVER, CO 80237-2737 800-333-3231 � ro MAClienLdo \FTCOLLIN\RFKFC 03 RFP.dm Copyright* Arthur J. Gallagher & Co. 2003 CITY OF FORT COLLINS NATIONAL RESOURCE TEAM Public Entity and Scholastic Division Steve Ring, Managing Director, National Public Entity and Scholastic Division, will serve as coordinator of Gallagher's national resources. He is: ■ Familiar with your operations, exposures, and insurance portfolio ■ Recognized as a national resource for public entity sector ■ Available as a resource to the City ■ Responsible for providing the national resources and oversight necessary to service your account Dorothy Gjerdrum, National Public Entity and Scholastic Division, is your Risk Management Specialist. Dorothy is a former county pool risk manager, so she is intimately aware of the challenges and concerns that you face. She has over ten years experience in both the underwriting and management of public entity pools (and their members). Her role is to assist in refining our focus in the public entity / pooling sector, which includes: ■ Assisting with selected loss control topics and seminars ■ Assisting with training for employment issues ■ Consulting for Risk Management Information System (RMIS) issues ■ Developing new products and services ■ Speaking nationally on topics of concern to public entities, most recently for the American Public Works Association national videoconference on the topic "Employment Liability Concerns During the Employee Discipline Process" ■ Assisting with the review of cost -allocation plans ■ Developing benchmarking tools ■ Providing Risk Management audits A Schematic of your local account management team and National Resource Team is on the following page. The team structure is designed to afford you with. ■ A single point of contact for overall account responsibility ■ Local and national expertise to meet the diverse needs of your account ■ Gallagher and independent resources coordinated at the highest team level ■ Expertise and personnel support necessary to meet and exceed your expectations Arthur J. Gallagher & Co. Response to RFP MAC1ientdocTTC0LLIMRFRFC03RFPAd Page 13 CITY OF FORT COLLINS CITY OF FORT COLLINS PUBLIC ENTITY & SCHOLASTIC DIVISION STRUCTURE Risk Services CLAIM MANAGEMENT Kim BILLS CHRISTINA WALSH RISK CONTROL MATT KRELL Account Management Ty PIXLER SENIOR ACCOUNT MANAGER BOBBIE TAYLOR ACCOUNT REPRESENTATIVE Team Leader KAREN GRAHAM National Resources PUBLIC ENTITY SCHOLASTIC DIVISION STEVE RING DOROTHY GJERDRUM PROPERTY ENGINEER WAYNE ONYX CLAIM ADVOCATES BARBARA GALLUPPI Jim KRUEGER c. Provide information to us, which indicates the financial status of your firm. Today, Gallagher is a full -service, international broker with over 185 offices in more than 10 countries. Our eight decades of profitable growth have been achieved through our commitment to quality and a pioneering approach in the design and implementation of insurance, reinsurance, risk management and self-insurance programs. A strong entrepreneurial spirit, continued product and service innovation, solid professional development programs and strategic technological advances ensure that we will fully perform for our clients. Financial highlights from 2002 include: Total Revenues $1,101,222,000 Net Earnings $ 129,739,000 Net Earnings Per Share $ 1.41 We are publicly traded on the New York Stock Exchange under symbol AJG. We invite you to visit our website at www.agg.com and have included our latest annual report for your review. Arthur]. Gallagher & Co. Response to RFP M:\C1ientdoc\FTC0LLIN\RFRFC 03 RFP.doc Page 14 CITY OF FORT COLLINS d. Does your agency retain full-time employees engaged in specialty areas such as in-house claims and loss control and safety services? Describe the services, level of availability and provide employees' names with a brief resume of their experience. Yes, our Risk Control Service Team is comprised of individuals from both the Denver, CO and our Itasca, IL, offices. Please refer to our response to Question 5.c, "Description of Our Service Team", Risk Control Service Team for a brief description of the individuals and their roles. 6. Please list the services that you can offer City of Fort Collins and your approach to marketing and servicing our account. Or, please provide a copy of your customary service plan for accounts similar to the City. We realize that the services may be customized based on the needs of a particular customer. We are interested in knowing what your firm sees as critical service features. COVERAGE APPROACH, MARKETING STRATEGY, SERVICE APPROACH Arthur J. Gallagher & Co. is uniquely qualified to assist the City with its risk financing strategy. To achieve these goals, we will focus on the following tasks: ■ Work with Risk Management during 2004 to develop a risk financing position that: Reconfirms limits of coverage • Reviews losses to prepare a retention analysis for property and liability Estimates risk financing costs within the established framework ■ Evaluate your Property coverages and retention levels to reduce current premiums. ■ Review a Catastrophic Third Party Liability (General Liability, Auto Liability, Employee Benefits Liability, Law Enforcement Legal Liability, and Public Officials) Excess Program over various retentions taking into consideration the Colorado Governmental Immunity Act and Federal out-of-state suits. Explore the cost effectiveness of utilizing a corridor deductible approach. Arthur J. Gallagher & Co. Response to RFP MAChent.dodFTCOLLIN%RFRFC 03 RFP.doc Page 15 ® CITY OF FORT COLLINS COVERAGE APPROACH Before outlining our solutions, a cursory review of your programs and policies are warranted. Property With regard to your Property coverage, each year we: ■ Review your form with regard to the current limits, terms and conditions being offered ■ Obtain quotes utilizing our manuscript property form that affords broad definitions of coverage and terms ■ Identify any catastrophic exposure to loss such as Flood or Earthquake to be sure we are requesting adequate loss limit and sub -limits ■ Identify your largest location to be sure the loss limit is adequate Liability With regard to Excess Liability, each year we review your current policy form to be sure: ■ It contains the broadest coverage terms available in today's market including limited pollution coverage. ■ Defense provisions are inside the self insured retention (SIR) and outside the limit of liability (if available) ■ An optional quote with a corridor deductible ■ The form is an occurrence form rather than a claims made form ■ It contains coverage for Professional Liability exposures ■ It contains coverage for Employment Practices Liability Arthur J. Gallagher & Co. Response to RFP MAClient.do \FTCOLLIN\RFRFC 03 RFPAd Page 16 CITY OF FORT COLLINS In general, the City enjoys broad, expansive coverage grants provided by their insurers. However, as with all programs, certain coverage areas continually need to be expanded or tweaked to reflect changes in exposure and/or market availability. To assist us in the ongoing analysis of our clients' insurance programs, we maintain a list of "uninsured / underinsured incurables" on all major accounts. This list allows us to... ) Quantify those exposures not being insured 1 Identify those areas where coverage is either restricted or for which only reduced limits are available 1 Focus on those areas where coverage may be enhanced on renewal ■ Environmental coverage (Public Entity Liability provides limited Pollution coverage) ■ Tenant User Liability Insurance Program (TULIP) ■ Inverse condemnation and eminent domain exclusion ■ Terrorism ■ Aggregate Stop Loss (Property) ■ Builders Risk ■ Cyber Liability ■ Foreign Liability ■ Mold We will review this list with you as we prepare for renewal each year in light of exposure and market changes. ArthurJ. Gallagher & Co. Response to RFP MAClient.do \FTCOLLIN\RFPWC 03 RFPAd Page 17 CITY OF FORT COLLINS When marketing large, complex programs such as the City's, we continue to look at innovative approaches to risk financing. Following are a few examples: OPTION I - PROTECTED SELF INSURANCE (CURRENT PROGRAM) This type of structure affords expanded coverage, greater determination with respect to claim management and access to more specialty markets that do not write first - dollar programs. GL/AL/LEL/POL PROPERTY EXCESS OF LOSS (EXCLUDES BOILER 8E MACHINERY) on $60,000 Deductible Arthur). Gallagher & Co. Response to RFP MdClientdo \FTCOLLIN\RFKFC 03 RFPAd Page 18 CITY OF FORT COLLINS OPTION 11 - CORRIDOR / AGGREGATE DEDUCTIBLE We have used this structure effectively with entities that have the appetite for additional risk, the financial capacity to absorb greater loss, and especially, that were offered sufficient premium savings to assume the added risk. This option contemplates the insertion of an aggregate deductible on your liability coverage in excess of your normal Self -Insured Retention (SIR). In concept, it gives underwriters an added buffer from a single shock loss or multiples of losses excess of your SIR, up to a specified limit. From the Insured's standpoint, it provides potential premium savings, while limiting your increased exposure to a known amount. In this situation, we would obtain quotations for a $100,000 corridor deductible excess of a $250,000 SIR. This option contemplates a layered approach on the Property coverage, which allows us to obtain an overall competitive alternative on your Property rate / premium. Layering the coverage allows us to utilize the capacity of various carriers at competitive rates to achieve the desired limit. GL/AL/LEL/POL PROPERTY $3,000,000 Layer Accumulated Capacity Limit $40,000,000 All Risk excluding Flood and $100,000,000 Earth Movement Arthur). Gallagher & Co. Response to RFP MACJienLdx\FTCOLLIN\RFRFC 03 RFP.dm Page 19 CITY OF FORT COLLINS MARKETING STRATEGY Our strategy for marketing your account or any of the accounts identified in our client list is very similar in nature. Our goal from the outset is to achieve the broadest terms and conditions at the lowest total cost of risk. In a nutshell, a marketing submission should be structured to emphasize the positive aspects of the risk and to address the negative issues. Our normal format is as follows: 1 Cover letter specifying the timeline of marketing effort 1 Narrative description of the client's mission and major operating divisions; disclosure of contractual procedures and liabilities, if any; and review of the marketing objectives 1 Outline of underwriting exposures by line of coverage and description of limits, coverages, terms and conditions we request be quoted for each line, sent to underwriters in the electronic format they desire ll� Three to five year loss history summarized by line of coverage, with an explanation of al I losses greater than $50,000 1 By line of coverage outline of suggested premiums and the rationale for them 1 Brief conclusion emphasizing the attractiveness of the risk One of the most important and often overlooked aspects of developing a concise submission is the pre -qualification of markets. We do this so that only information necessary to analyze your risk or to evaluate the lines of coverage being quoted is provided to a market. This extra step frees underwriters from wading through a morass of information and allows them to focus on our specific request. Following is a description of the process we follow to insure the continued competitiveness of the risk financing alternatives developed for our clients. As your broker, we will review this process with you to be certain it meets your needs and time/manpower constraints. Note: These dates will be modified to meet the services required by Scope of Work and the timetable, in your RFP. Arthur J. Gallagher & Co. Response to RFP M.kClient.dm\FTCOLLIN\RFRFC 03 RFP.dnC Page 20 ® CITY OF FORT COLLINS tllyMFort Collins INITIATIVE TASK CRITICAL DATE Program ✓ Deductible/Retention Analysis 210-180 Analysis ✓ Exposure/Coverage Analysis Days Prior to ✓ Review of Alternative Risk Financing Options Renewal ✓ Update Uninsured Insurables ✓ Present Request for Updated Exposure Information Pre -Renewal ✓ Discuss Market Conditions 210-180 Meeting ✓ Suggest Program Changes Days Prior to ✓ Review Marketing Strategy Including Analysis of Individual Renewal Market's Financial Condition, Loss Experience and Service Capabilities ✓ Estimate Timeline/Renewal Goals with City of Fort Collins ✓ Update/review Claims Experience ✓ Review Uninsured Insurables Marketing ✓ Receipt of Updated Exposure Information Between ✓ Preparation of Underwriting Specifications 120-150 ✓ Review Specs with City of Fort Collins Days ✓ Specs to Underwriters Prior toRenewal ✓ Negotiations with Markets ✓ Bi-Monthly Status Reports to Risk Management Final Renewal ✓ Presentation of Proposals to City of Fort Collins 45 Days Negotiations ✓ Arrange Meeting with Underwriters and City of Fort Collins Prior to ✓ Finalize Terms and Conditions Effective ✓ Issue Binders, Certificates and I.D. Cards Date Policy ✓ Thoroughly Review Policies / Reinsurance Agreements 90 Days after Administration ✓ Request Corrections Inception ✓ Develop Current Schedule of Insurance ✓ Deliver Policies and Summaries SERVICE REQUIREMENTS AND TIMEFRAMES Our role extends throughout the year and does not end with placement of your program. The combined strength of our personnel and our approach to deliver broker / consultant services sets us apart from our competition. Gallagher has established the following standard service commitments and quality satisfaction tools. We execute with a "no —surprises" philosophy and acknowledge that responsiveness is paramount to maintaining client confidence. The following is an illustration of our standards of service and/or response time —frames: Arthur J. Gallagher & Co. Response to RFP MAClient.do \FTCOLLIN\RFRFC 03 RFPAd Page 21 ® CITY OF FORT COLLINS TECHNICAL SERVICE STANDARDS * Within: ■ Return phone calls Same Day (or 24 hours) ■ Issue binders, invoices, and related document 3 work days of effective date ■ Incorporate policy changes 3 work days of receipt ■ Issue certificates 24 hours of receipt or as needed ■ Process premium -bearing endorsements 5 work days of receipt from carrier ■ Process non premium -bearing endorsements 15 work days of receipt from carrier ■ Perform audits 5 work days of receipt from carrier ■ Issue auto ID cards 24 hours ■ Check policies and deliver t9O work days of effective date * The above Technical Service Standards are included in the job descriptions of Account Management Team Members. The response times can be adjusted to meet your needs. In order to provide the best service to the City of Fort Collins, we agree to the following: ■ Attend quarterly meetings (more frequently as needed) with Risk Management ■ A team member will "check in" with Risk Management via telephone once a week ■ All conversations will be followed up in writing or through E-mail (Lotus Notes) ■ Due diligence and follow-up on all pending action items ■ Follow through on timelines / time frames as agreed to by Risk Management and team members ■ Any attachments sent via fax will have hard copies provided by regular mail (if desired) ■ Assist with development of a direct relationship with underwriters Arthur]. Gallagher & Co. Response to RFP MAClient.dodFTCOLLIN\RFMFC 03 RFPAd Page 22 ® CITY OF FORT COLLINS ae�orr�LcowN TABLE OF CONTENTS PAGE INTRODUCTION............................................................................ I SUBMITTAL SECTION — RFP #P895-INSURANCE..................... insert RESPONSE TO SUBMITTAL SECTION QUESTIONNAIRE QUESTIONS1 - 10..................................................................1 EXPECTED RESULTS AND CONCLUSION .......................................... 30 THE GALLAGHER GROUP OF COMPANIES ARTHUR J. GALLAGHER & CO. - DENVER MISSION AND VISION STATEMENT PROFESSIONAL PROFILES PROFIT SHARE PAYOUT ILLUSTRATION MARKET PREFERENCES BY BROKER SAMPLE BROKER SERVICE PLAN CATASTROPHE MODELING Arthur J. Gallagher & Co. Response to RFP MAClient.doc\FTCOLLIN\RFP\FC 03 RFP.do CITY OF FORT COLLINS OUR PROCESS Standard Procedures Our account management staff is required to complete the following procedures with each of our commercial and risk management accounts to ensure we deliver what we promised: New (Business) / Renewal Procedures — Meticulously outlines our standard activities for your renewal submission. MINIMUM STANDARDS REQUIREMENTS — Over 50 questions to address loss trends, state licensing requirements, use of approved intermediaries, policy wording and definitions, deductibles, drop -down provisions over exhausted policy limits, valuation clauses, retroactive dates for claims -made forms, defense costs, foreign exposures, etc. STANDARD PROPOSAL REQUIREMENTS - Ensures accuracy across 70 points including the A.M. Best's rating of carriers, presentation of coverages, coinsurance, and claim -reporting requirements. Contains clear notation of policy exclusions and valuation clauses as well as an outline of claims -made provisions, rating basis (if applicable), and any TPA provisions. POLICY CHECKLIST - Compares the policy with the proposal you accepted including accuracy of named insureds, premiums, coverages, limits, deductibles, schedules, classifications, surplus lines requirements, claims -made requirements, etc. FILE AUDIT - Confirms internal procedures have been followed, such as proper countersignatures, licensing, and solvency requirements, policy setup, checklists, etc. ANNUAL SERVICE PLAN — Documents our agreed upon goals for the policy year along with action items, timing and responsibilities. Refer to the Exhibits section for a sample Broker Work Plan. QUALITY REVIEW INTERVIEW — Evaluates our performance for the City, with details on any requested changes or improvements. These standard procedures are the way we internally measure the service we provide you. In addition, we would follow the Broker Service Plan (sample provided in the Exhibit section of this proposal) that would be developed by the City and your Gallagher Account Team. Arthur J. Gallagher & Co. Response to RFP MAChent.do \FTCOLLIMRFPTC 03 RFPAo Page 23 CITY OF FORT COLLINS OUR PERFORMANCE Within Gallagher we believe The Customer Defines Quality. We adhere to a documented, disciplined process to measure and confirm that we consistently exceed client expectations. We will conduct an annual Quality Review with the City of Fort Collins allowing you to grade the following categories based on 1 (lowest) to 5 (highest) scale, including comments made during that quality review: ■ RESPONSIVENESS ■ PERSONNEL ■ COMMUNICATION ■ UNDERSTANDING YOUR NEEDS ■ ADMINISTRATIVE PRACTICES ■ PRODUCTS AND SERVICES ■ VALUE Arthur). Gallagher & Co. Response to RFP M.\Client.dm\FTCOLLIN\RFRFC 03 RFPAd Page 24 ® CITY OF FORT COLLINS tltvof fmt Collins 7. The proposed cost of the services outlined in this RFP. Is the cost all-inclusive, or do certain services require additional fees? Please make it clear what your costs cover. City of Fort Collins reserves the right to negotiate the scope of work and applicable costs with the selected vendor. Our proposed compensation is on a fee basis, and is based on services rendered, the amount of time involved, and the level of professionals assigned to your account. Together with the City, we will establish a service plan that details services. This allows us to set objectives and serves as a benchmark. Our plan will be flexible, so it can be modified to continue addressing the ever -changing environment and market conditions. Based on the information provided, including all items noted in "Scope of Work," and our understanding of the City's current insurance program, we propose the following options: FLAT FEE - $40,000 ANNUALLY ALL LINES OF COVERAGE Fee 10 $40,000 Annually 1 We will stipulate the fee will not increase more than 5% annually. Arthur). Gallagher & Co. Response to RFP MACHent.dodFTCOLLIN\RFNFC o3 RFPAd Page 25 CITY OF FORT COLLINS DEPOSIT FEE MINIMUM FEE PERFORMANCE INCENTIVE DEDUCTIONS (TO BE NEGOTIATED ANNUALLY) PERFORMANCE BASED FEE OPTION FOR ALL LINES OF COVERAGE ONLY P $43,000 Annually 1 $38,000 1 We will stipulate the fee will not increase more than 5% annually 1 From Deposit Fee if not performed to the City's satisfaction: ■ Conformance to the City's established renewal process standards - $2,000 ■ Deliver and review of policies within 90 days of renewal - $1,000 ■ Conformance to the City's established service response standards - $2,000 Other Gallagher resources, such as third party claims administration and audit, risk control services beyond 20 hours, appraisals, etc. would be an additional fee. Risk control services are billed at a fee of $125.00 per hour. Both fees include: 1 Customary brokerage / consulting services for administration of the City's insurance portfolio, periodic risk management meetings, coordination of claims reported to excess carriers, collection of claim payments from excess carriers. 111� All items noted in N Scope of Work". 0 20 hours of risk control services applies. Arthur J. Gallagher & Co. Response to RFP MAC1ientdxVTC0LL1MRFMFC 03 RFPAd Page 26 CITY OF FORT COLLINS 8. Please explain why you believe that you and your organization are the best party to represent the City in the marketplace and how your approach to client services and program is unique. In addition to our response to questions # 3 and #6 that describes our Public Sector expertise, marketing strategy and approach to delivering Account Management Services. Karen Graham, Team Leader, has expertise in large property placements. Most recently she has designed and placed programs with values in excess of $6 billion for Colorado School Districts Self Insurance Pool and the University of Colorado. In addition to her property expertise, she has designed, marketed and placed large, complex excess liability coverage on both an excess of loss and reinsurance basis. Our proposal highlights a number of attributes such as national expertise, which we believe are worthy of consideration in selecting your broker. However, our greatest strength lies in the following areas: OUR LOCAL EXPERTISE Your Account Management Team has over 30 years of combined insurance experience serving local municipalities, especially in the alternative risk market. We are familiar with Colorado Immunity Statutes and case law supporting these statutes. We track and report to our clients on legislation and court cases. We are familiar with federal laws, regulations and court decisions that create potential liabilities. We have manuscripted policy language to address many of these exposures. We have been innovators in addressing the risk management needs of Colorado municipalities and we continue to look for creative alternative methods of addressing your risk management needs. LOSS CONTROL, CLAIMS COST CONTROL, AND CLAIMS MANAGEMENT Your Gallagher team includes professionals at both the local and national level who are expert in claims management and advocacy, risk services and loss control. Refer to our discussion of the Risk Control Service Team on pages 11 and 12. Arthur J. Gallagher & Co. Response to RFP MACVent.doc\FTC0LLIMRFRFC03 RFPAd Page 27 CITY OF FORT COLLINS OUR MARKET RELATIONSHIPS Gallagher's dominant position in the municipal marketplace and our reputation and Premium volume with the principal public entity underwriters affords our clients a distinct advantage. Our relationship with the markets and our knowledge of governmental exposures allows us the opportunity to negotiate the broadest, most cost-effective placement on behalf of our clients. The length of our tenure as broker for our local clients reflects this strength. OUR WILLINGNESS TO Go THE EXTRA MILE Over the years with similar clients, there have been numerous situations where your Account Management Team has demonstrated their willingness to do what it takes to get the job done. Whether it was in the rush issuance of a certificate of insurance or assisting in obtaining underwriters' agreement to a proposed settlement offer, we have been there for our clients. This sense of urgency and team spirit is a defining characteristic of our organization and what sets us apart from our competition. CUSTOMER SERVICE - IMMEDIATE ACCESS TO THE TEAM Gallagher is committed to maintaining the highest level of responsiveness, access, and customer service through our team of professionals. Your account will be serviced out of the Public Entity / Scholastic Division in our Denver office. Your account management team is multi -disciplined —all lines of coverage are handled out of this division. We do not divide your account throughout various disciplines (Property / Casualty), nor do we send your account to a marketing or service center in a distant city. We offer immediate response for emergencies and are available within 24 hours for other special situations. Karen Graham is accessible to you at all times. Arthur J. Gallagher & Co. Response to RFP MACFent.do6FTC0LLIN\RFRFC 03 RFPAd Page 28 CITY OF FORT COLLINS 9. List what your firm believes to be the three most important responsibilities of a broker/agent and give a very brief example of how you have fulfilled these three responsibilities for one client. Also, please give reference information for this client. We seek to accomplish with our clients three overriding goals. These are to: 1 Protect the assets of the Insured 1 Provide long-term, cost effective risk financing options 1 Enhance the Insured's ability to manage risk by increasing their knowledge, awareness, and control of exposures to loss In addition, we feel that the day -today servicing of accounts is extremely important in order to allow our clients to respond the needs of their organizations effectively and efficiently. Please refer to our references provided in question #2. 10. Provide support or recommendations regarding the effectiveness of the following timetable. Also, please provide acknowledgement as to acceptability of your completion of the attached analysis spreadsheets, if you were selected to assist the City in its renewal process. We did receive the timetable and cost analysis worksheets as Addendum No. 1 to this RFP. After review of the timetable mentioned above, we believe it is achievable and we are committed to obtaining buy -in from the underwriter to adhere to these dates. This is of course based off of receipt of complete, comprehensive underwriting information on September 1, 2003, as noted in the timetable. We do acknowledge the analysis spreadsheets and agree to complete them. Arthur J. Gallagher & Co. Response to RFP MAClient.dw\FTCOLLIN\RFRFC 03 RFPAd Page 29 CITY OF FORT COLLINS EXPECTED RESULTS AND CONCLUSION Expected Results The City can expect results that: 1 Identify— Insurable Risk Exposures unique to the City 1 Eliminate — to the extent possible — unknowns in your ultimate cost of risk 1 Market your insurance portfolio effectively 1 Acknowledge your specific risk management needs and respond to them 1 Determine the most effective alternatives to address your risk management concerns 1 Reduce your cost through effective use of claims management, loss prevention and focused marketing 1 Grow with a proactive broker/ risk management partnership that will evolve with your future needs / Provide timely and accurate data on exposures, costs and claims 1 Meet and exceed service plan objectives 1 Work with a well-informed professional staff — market and industry specific issues 1 Underscore that we are a part of your team, but not part of your payroll Conclusion Arthur). Gallagher & Co.'s seventy-five years servicing public entities provides us with expertise unmatched by our competitors. In addition to a track record of excellence in municipal and government systems, we have broad risk management expertise including marketing, loss control and claims management. We have the resources and expertise to assist you to explore new options to strengthen your risk management program. Thank you for the opportunity to respond to your RFP. We look forward to further discussing your risk management objectives and our ability to help you achieve them. Arthur J. Gallagher & Co. Response to RFP MAC1ientdoc\FTC0LLIN\RFRFC03 RFPAd Page 30 ® CITY OF FORT COLLINS Cltyot Fon coutng EXHIBITS Arthur J. Callagher & Co. Response to RFP MAClient.docWTCOLLIMRFNFC 03 RFP.doc Page 31 CITY OF FORT COLLINS THE GALLAGHER GROUP OF COMPANIES Arthur J. Gallagher & Co. Response to RFP MAClient.do \FTCOLLIN\RFRFC 03 RFP.dw Page 32 CITY OF FORT COLLINS INTRODUCTION hank you for the opportunity to respond to your Request For Proposal #P895- Insurance. Our proposal highlights Arthur J. Gallagher & Co.'s qualifications and capabilities to provide the brokerage and consulting services required by the City of Fort Collins. As your broker/ consultant, we view our mission as having four primary objectives: 1. To assist you in protecting the tangible and intangible assets of the City, 2. To enhance your ability to assess and manage risk by increasing your knowledge, awareness and control of exposures to loss, 3. To reduce your overall risk management costs by providing long-term, cost effective risk transfer options as needed, and 4. To ensure that the City has an efficient and cost-effective means to process loss information and claims. The individuals assigned to your risk and the management approach we use are intended to achieve these objectives. Given the opportunity to work with you, we are confident they can be attained. Karen Graham, CIC, ARM-P has been assigned as the Team Leader and Primary Account Executive on your account. As the Branch Manager, Jim Bayne has overall responsibility for management of the Denver office. Below are mailing addresses, telephone and facsimile numbers. Karen L. Graham, CIC, ARM Arthur J. Gallagher & Co. — Denver 7900 E. Union Ave., Suite 200 Denver, CO 80237 720-528-3637 Direct Phone Line 303-773-9776 Facsimile karen_graham@ajg.com Jim Bayne Arthur J. Gallagher & Co. — Denver 7900 E. Union Ave., Suite 200 Denver, CO 80237 720-528-3624 Direct Phone Line 303-773-9776 Facsimile j im_bayne(gajg.com Arthur J. Gallagher & Co. Response to RFP MAClientdo \FTCOLLIN\RFNFC 03 RFPAd Page i CITY OF FORT COLLINS THE GALLAGHER GROUP OF COMPANIES ARTHUR J. GALLAGHER & COMPANY (" GALLAGHER") is one of the largest and fastest growing brokers in the insurance industry. The basis of our success is our commitment to meeting each client's particular insurance needs. To accomplish this, we plan and administer all types of insurance, reinsurance, risk management and self-insurance programs. And we do it through an organization of specialized companies. ARTHUR). GALLAGHER & COMPANY The parent company. BROKERAGE SERVICES DIVISION (BSD) Gallagher's largest division. BSD specializes in property/casualty insurance and risk management programs for commercial, industrial, institutional and governmental organizations. This is accomplished through a nationwide network of brokerage service offices with technical support from other Gallagher Divisions. GALLAGHER BASSETT SERVICES, INC. (GB) Gallagher's principal risk management subsidiary dedicated to serving the risk management needs of corporations and institutions on a worldwide basis. Services include claims management, risk control consulting, information management, appraisals and other special services. GALLAGHER BASSETT INTERNATIONAL LTD. (GBI) GBI is a subsidiary of Gallagher Bassett Services, Inc. and provides risk management services to both foreign operations and U.S. operations that are foreign controlled. Headquartered in London, GBI works with insurance companies, reinsurance companies, overseas brokers, and risk managers of overseas organizations. Services include consulting, claims management, loss control, property valuations, and information management. GALLAGHER BENEFIT SERVICES (GBS) A major division specializing in risk management of human resources. Professional services and products include all types of employees benefits, deferred compensation, pensions and tax sheltering mechanisms, through insured and self -funded programs. GALLAGHER BASSETT BENEFIT ADMINISTRATORS (GBBA) The administrative arm of Gallagher Benefit Services, GBBA serves the self -funded employee benefit market. This is accomplished by integrating highly effective managed cost and quality assurance programs with claims administrative services. ARTHUR J. GALLAGHER (UK) LIMITED A wholly owned London broker with ability to directly access Lloyd's of London insurance markets, as well as international markets worldwide. Brokerage services include marine, reinsurance, aviation, construction, property / casualty, and employee benefit placements. GALLAGHER RISK DATA, INC. (GRD) GRD is a wholly -owned subsidiary of Gallagher that investigates and develops opportunities for marketing stand-alone information system products which are developed by the various Gallagher companies. CORPORATE INFORMATION SYSTEMS (CIS) CIS is a division of Gallagher that defines Gallagher's overall corporate information system architecture, researches new ways to apply technology to solve business problems, and coordinates the implementation and integration of corporate data and business applications throughout Gallagher's worldwide sales and service network. Arthur]. Gallagher & Co. Response to RFP MAClient.dm\\FTCOLLIN\RFRFC 03 RFP.doc Page 33 CITY OF FORT COLLINS THE GALLAGHER GROUP OF COMPANIES (CONTINUED) RISK PLACEMENT SERVICES, INC. This subsidiary operates as a traditional wholesale broker and managing general agent, working with both Gallagher and non - Gallagher producers, and has access to all major excess/surplus lines carriers. Its operating units include: International Special Risk Services, Inc., ARM of California, Nelson, Gordon & James Insurance Services, R&R/Select, and Harbor Excess & Surplus. INNOVATIVE RISK SERVICES, INC. This division facilitates access to Bermuda - based insurance companies for both Gallagher and non -Gallagher producers. GALLAGHER BASSETT CANADA, INC. A subsidiary of Gallagher Bassett, this operation provides claims management, loss control, and information management services to Canadian and U.S. clients. WYATT GALLAGHER BASSETT PTY LTD. This joint venture between Gallagher Bassett Services, Inc. and the Wyatt Group Pty Ltd provides loss adjusting, marine, and aviation surveying, claims management, information services, and risk control consulting services throughout Australia. AJG FINANCIAL SERVICES, INC. This subsidiary specializes in alternative investment strategies and tax -advantaged investments. It manages Gallagher's own investment portfolio and is expanding the availability of some of those strategies and investments in conjunction with the insurance services for which Gallagher is known. ARTHUR J. GALLAGHER & COMPANY (BERMUDA) LIMITED An offshore subsidiary. Provides clients with access to the Bermuda marketplace for direct and reinsurance placements. Also provides offshore captive information and management services. INTERNATIONAL SPECIAL RISK SERVICES, INC. An in-house wholesale brokering facility. Provides clients an entry into the domestic excess and surplus line carriers and reinsurance marketplace. Allows BSD to broker risks to the domestic and international marketplace. ARTHUR J. GALLAGHER INTERMEDIARIES, INC. A wholly -owned reinsurance brokering subsidiary based in New York City. This operation places facultative reinsurance for leading primary and excess insurers. GALLAGHER CAPTIVE SERVICES A division of Arthur J. Gallagher & Company created to offer our sales branch network access to experienced captive specialists and proven technique as they introduce clients and prospects to the benefits of the captive concept. This allows us to provide new and more cost-effective response to managing risk. RISK MANAGEMENT PARTNERS, LTD. (RMP) Company founded by Gallagher and American Re Corporation to develop overseas risk management and loss control services for public entities throughout the United Kingdom. This experience will be applied to other foreign countries in the months and years ahead. Arthur J. Gallagher & Co. Response to RFP Md\C1ienldoc9\FTC0LLIN\RFRFC 03 RFPAd Page 34 CITY OF FORT COLLINS ARTHUR ]. GALLAGHER 81 CO. - DENVER MISSION 81 VISION ArthurJ. Gallagher & Co. Response to RFP MAClien[.dodFTCOLLIN\RFP\FC 03 RFP.dm Page 35 CITY OF FORT COLLINS ARTHUR ]. GALLAGHER 81 CO. - DENVER OUR MISSION We are an insurance brokerage, consulting and risk management services company committed to being the best at reducing the cost of risk and protecting the financial integrity of our clients. OUR VISION To be recognized and respected .. . By our clients as unparalleled customer service professionals providing responsive and innovative solutions that address their needs. By our markets as tenacious competitors providing opportunities for growth and operating with the highest degree of integrity and ethical character y our employees as "a winning team" providing a fair, challenging and friendly environment that rewards performance, encourages creativity and supports personal development. By our community as an organization promoting both individual and collective involvement that "makes a difference". ArthurJ. Gallagher & Co. Response to RFP MACFenLdo6FTC0LL1WRFRFC03RFPAd Page 36 9 CITY OF FORT COLLINS PROFESSIONAL PROFILES Artrnurj. Gallagher & Co. Response to RFP M3Client.do lFTCOLLIN\RFMFC 03 RFPAd Page 37 CITY OF FORT COLLINS Nof Fmt ColOne KAREN GRAHAM, CIC, ARM-P AREA VICE PRESIDENT - PUBLIC ENTITY/SCHOLASTIC DIVISION FIELDS OF EXPERTISE PROFESSIONAL AFFILIATIONS 1 Oversee day-to-day client services 1 Society of Certified Insurance for the Public Entity/Scholastic Unit Counselors (CIC) 1 Alternative risk financing 1 Public Risk Insurance Management 1 Public entity risk management Association (PRIMA) 1 Policy reviews / maintenance 1 Colorado Self -Insurers' Association 1 Manuscripting of policy forms (CSIA) 1 Contractual guidelines / reviews 1 Risk and Insurance Management 1 Marketing insurance coverages and Society, Inc. (RIMS) program design 1 Association of Governmental Insurance EXPERIENCE Risk Pools (AGRIP) 1 Colorado Municipal League (CML) 1 1 27 years' brokerage experience Assisted in manuscripting property CLIENT EXPERIENCE policy for public entities 1 Adams County, CO 1 Developed contractual guidelines 1 Adams -Arapahoe School District for numerous public entities 1 Boulder County, CO 1 Assisted in establishing the 1 City of Arvada, CO Colorado Public Entity Risk 1 City of Boulder, CO Purchasing Group and 1 City of Fort Collins, CO manuscripting the policy form 1 City of Westminster, CO CREDENTIALS 1 Colorado Health & Hospital WC Trust 1 Colorado Intergovernmental Risk 1 Mile High College — Freelance Sharing Agency (CIRSA) Reporter 1 Colorado School Districts Self - Certified Insurance Counselor (CIC) Insurance Pool 1 Multiple Lines Agents License 1 Denver Regional Council of 1 Associate in Risk Management Governments (ARM) 1 El Paso, County 1 Risk Management for Public Entities 1 Fire and Police Pension Association (RMPE) (FPPA) 1 Blessing White, Inc. Management 1 Larimer County and Leadership Training 1 Pitkin County, CO / Certified Risk Manager candidate 1 University of Colorado 1 Washington State Transit INDUSTRY PUBLICATIONS Insurance Pool 1 Wyoming Local Government 1 Ensuring Adequate Coverage: Public Liability Pool Risk 0 Weld County, CO Arthur J. Gallagher & Co. Response to RFP MACFent.dmXFTCOLLINIRFKFC 03 RFPAd Page 38 CITY OF FORT COLLINS Ty PIXLER SENIOR ACCOUNT MANAGER - PUBLIC ENTITY/SCHOLASTIC DIVISION 00 FIELDS OF EXPERTISE 1 Day-to-day client services 1 Public entity risk management 1 Risk management / large complex commercial accounts 1 Policy review / maintenance 1 Exposure / coverage analysis 1 Marketing insurance coverages 1 Contract guidelines/ reviews 1 Ancillary coverage programs 1 Claims analysis EXPERIENCE 1 Nine years experience with insurance brokerage firms CREDENTIALS 1 Multiple Lines Agents License 1 Certified Insurance Counselor candidate 1 Supervisory in Management PROFESSIONAL AFFILIATIONS 1 Public Risk Insurance Management Association (PRIMA) 1 Risk and Insurance Management Society (RIMS) KEY PRO/ECTS 1 Day -today client support 1 Training account managers and account assistants 1 Arthur J. Gallagher & Co. Support Staff Committee Chair CLIENT EXPERIENCE / Adams -Arapahoe School District 28J 1 Boulder County, CO 1 Cherokee Companies 1 City of Arvada, CO 1 City of Boulder, CO 1 City of Fort Collins, CO 1 Denver Health and Hospital Authority 1 Jefferson County, CO 1 Larimer County, CO 1 Pitkin County, CO 1 State of Wyoming 1 University of Colorado 1 University of Denver 1 Wyoming Local Government Liability Pool Arthur J. Gallagher & Co. Response to RFP MdClient.da \\FTCOLLIN\RFRFC 03 RFPAd Page 39 CITY OF FORT COLLINS BOBBIE TAYLOR ACCOUNT REPRESENTATIVE - PUBLIC ENTITY/SCHOLASTIC DIVISION FIELDS OF EXPERTISE ) Policy checking / reviews 1 Client services 1 Certificates, endorsements, binders, audits, invoicing, MVRs EXPERIENCE 1 Over 8 years' insurance industry experience 1 Experience in servicing small and large commercial lines accounts 1 Experience in claims handing for auto CREDENTIALS 1 Towson University 1 Colorado Insurance Producer License - All Lines: Property, Casualty, Life, Health 1 Certified Insurance Counselor (CIC) candidate CLIENT EXPERIENCE 1 University of Colorado 1 Washington City and County Transit Insurance Pool (the City and County) 1 El Paso County, CO 1 City of Aurora, CO 1 Colorado Intergovernmental Risk Sharing Agency 1 Larimer County, CO 1 The Broe Companies, Inc. 1 City of Renton, WA Arthur). Gallagher & Co. Response to RFP M.\Client.do \FTCOLLIN\RFP\FC 03 RFP.doc Page 40 CITY OF FORT COLLINS jCJ.fACWH., Kim BILLS, CPCII, ARM, CPDM, SPHR CLAIM SERVICES On FIELDS OF EXPERTISE / Claims management 1 General / Professional Liability / Auto / Employment Practices / Workers Compensation 1 Coverage interpretation and review 1 Litigation, mediation, negotiation, and subrogation 1 Claim handling procedures and standards 1 Claim file audits standards and implementation 1 Loss trending and analysis 1 Return -to -work programs 1 Alcohol and drug testing 1 FMLA, ADA, FLSA, ERISA, and DOT 1 Short and long-term disability / Human capital and compliance policies and procedures / Healthcare programs EXPERIENCE 1 15 years experience in claims, loss control, risk management, total absence management, human resources, data systems, client services and account management 1 Adjusted and supervised large, complex, multiple lines claims 1 Designed and implemented innovative risk management and educational programs for various clients 1 Development and implementation of integrated disability and total absence management programs 1 Creation of corporate risk and human capital policies and procedures CREDENTIALS 1 Chartered Property Casualty Underwriter (CPCU) / Associate in Risk Management (ARM) 1 Certified Professional Disability Management (CPDM) 1 Senior Professional Human Resources (SPHR) Arthur J. Uallagher & Co. Response to RFP M:\Client.doc\FTCOLLIN\RFP FC 03 RFP.dm Page 41 CITY OF FORT COLLINS MATT KRELL, ARM, CSP, CIC ASSISTANT VICE PRESIDENT - RISK SERVICES O:; FIELDS OF EXPERTISE 1 Training 1 Program design 1 Cost containment EXPERIENCE 1 More than 10 years' experience in human resources, claims, and safety 1 Expertise in the areas of human resource support, Workers Compensation / HR integration issues, employment practices evaluations, safety assessments, customized training programs CLIENTS 0 Sage Hospitality Resources, LLP 1 American Furniture Warehouse 0 Translogic Corporation 1 Chief Auto Parts 0 Colorado College 0 Homestead House AFFILIATIONS / DESIGNATIONS b Certified Safety Professional (CSP), Comprehensive Practice, #14073 1 Associate in Risk Management (ARM) 1 Certified Insurance Counselor (CIC) 1 Instructor, Associate in Risk Management program 1 Professional Member - American Society of Safety Engineers 1 Professional Member- American Industrial Hygiene Association 1 Licensed Life & Health / Property & Casualty Broker 1 Board Member, Colorado Cost Containment 1 Instructor, Colorado Safety Association CREDENTIALS 1 Bachelor of Science - California City and County University, Northridge, Finance & Human Resource Management Arthur J. Uallagher & Co. Response to RFP M:\Clien[.do TtCOLLIN\RFP\FC 03 RFP.doc Page 42 CITY OF FORT COLLINS In our response to the Request for Proposal, we describe our experience and capability to provide superior quality risk management services for the City. Our corporate commitment to the public entity sector, coupled with the track record of our Denver office, speaks to our ability to deliver on our promises. We encourage you to check our references. Thank you for the opportunity to respond to your RFP. Arthur J. Gallagher & Co. is unquestionably capable and enthusiastic about the opportunity to continue working with the City of Fort Collins. We look forward to further discussing your risk management objectives. Arthur J. Gallagher & Co. Response to RFP MdClient.dx\FTCOLLIN\RFP\FC 03 RFPAd Page i CITY OF FORT COLLINS STEVE RING CORPORATE VICE PRESIDENT / MANAGING DIRECTOR PUBLIC ENTITY 81 SCHOLASTIC DIVISION 1999 TO PRESENT b Corporate Vice President of AJG Co.. Responsible for all property/casualty operations in the North Central United States. Offices include Kansas City, Minneapolis, Grand Rapids, MI and Detroit. Total revenues approximately $30 million. 1998 to 1999 0 President of the Non Profit Division of Arthur J. Gallagher Risk Management Services. This operation included public entity, scholastic, higher education and religious business. Revenues were $7 million. 1996 to 1998 1 President of Arthur J. Gallagher— Schaumburg. This was a property casualty sales office located in the suburbs of Chicago. The office was predominantly commercial business with a sprinkling of school business, particularly higher education. This office had revenues of $5 million. 1991 to 1996 0 Unit Manager in the National Risk Management Sales Division of AJG Co. Led a team of producers specializing in alternative market business predominantly in the public sector, education and religious areas. The unit had revenues of roughly $4 million. 1986 to 1991 0 Account Executive in the National Risk Management Sales Division of AJG Co. Responsible for new business production and overall growth of a book of business in various parts of the country. My book was comprised of public sector and religious business. 1979 to 1991 0 Account Executive in the Rolling Meadows office of Arthur J. Gallagher & Co. Responsible for new business production and overall book growth of commercial business in the Chicago area. Education 0 Graduate of Illinois Wesleyan University in 1979 with a bachelor of science degree in Business Administration and Insurance. Played varsity college baseball all four years. Arthur J. Gallagher & Co. Response to RFP MAClientda kFTC0LLIN\RFRFC03 RFP.dm Page 43 CITY OF FORT COLLINS DOROTHY G]ERDRUM DIRECTOR OF RISK MANAGEMENT NATIONAL PUBLIC ENTITY / SCHOLASTIC DIVISION 0%% FIELDS OF EXPERTISE 1 Coordination of special services, including peer mediation and ERP tracking methodology 1 Assistance with selected loss control topics and seminars AFFILIATIONS 1 Speaker of ASSE, ArmTech, APWA and PRIMA conferences 1 Former organizer, president & board member of NM PRIMA 1 Consultant and training assistance for 1 Participant in national focus group for public entity clients public risk database project 1 Consultant for miscellaneous Risk Management Information Systems 1 Former treasurer & board member of 1 Liaison for public entity and school County Reinsurance, Limited clients 1 Active member of the Leadership Team of the National Public Entity and Scholastic EXPERIENCE Division 1 10 years' experience in public sector risk management and training KEYPRo/Ecrs 1 Trained more than 1,000 employees and elected officials on how to prevent 1 Development of new products and workplace harassment and services to meet needs of public entity discrimination and school clients 1 Developed formulas to distribute equity 1 Act as consultant and resource for clients and create loss -sensitive contributions for and their brokers members 1 Developed cost allocation plan for pool 1 Assist Gallagher to refine their focus on members public entity and school clients 1 Strategic planning 1 Represent Gallagher as a national speaker 1 Developed risk management and loss on topics of concern to public entities control programs for pools and schools EDUCATION 1 Bachelor of Arts, College of St. Catherine 1 Associate in Risk Management designation 1 Certified Trainer in the Agos Group's Watch program 1 Guest speaker for the American Public Works Association national video conference on topic "Employment Liability Concerns during the Employee Discipline Process" Arthur J. Gallagher & Co. Response to RFP M:\Client.dociFTCOLLIN\RFP\FC 03 RFP.doc Page 44 j(31f CITY OF FORT COLLINS BAR13ARA GALLUPPI VICE PRESIDENT a DIRECTOR CLAIMS MANAGEMENT SERVICES FIELDS OF EXPERTISE EXPERIENCE 1 Governmental and school pools 1 Claims Training Supervisor 1 Trucking companies 1 Captive programs 1 Overall claim conflict resolution 1 TPA selection and oversight 1 Clinic attorney and vendor selection and general policy coverage resolution 1 Seminars and training to clients and adjusters in all major casualty lines from beginning levels through senior and advanced levels 1 Senior Toxic Tort Specialist 1 Senior Multiline Claims Analyst 1 Senior Claims Examiner/ Outside Field Investigator CREDENTIALS 1 Chartered Property and Casualty Underwriter (CPCU) Arthur J. Gallagher & Co. Response to RFP MAC11entdm\\FTC0LLIN\RFRFC 03 RFPAd Page 45 CITY OF FORT COLLINS JAMES P. KRUEGER CLAIMS MANAGEMENT CONSULTANT RISK MANAGEMENT SERVICES, INC. FIELDS of EXPERTISE 1 Claim status reports for clients and producers 1 Claim review meetings 1 Claim reports to carriers & claim activity monitoring 1 Lawsuit reports to carriers 1 Closed and pending lawsuit report maintained EDUCATION 1 Bachelor of Science, Business Administration, Western Illinois University EXPERIENCE 1 Estimate prospective jobs and schedule sub -contractors and crew for current jobs 1 Contact insurance agents and adjusters for potential business 1 Invoicing and collection of completed jobs 1 Processed all lines of insurance claims, including property, workers compensation, liability and auto 1 Specialized in large property and workers compensation claims 1 Facilitation of insurance companies' over flow claim count Arthur J. Gallagher & Co. Response to RFP MBClient.dodFTCOLLIN\RFRFC 03 RFP.do Page 46 CITY OF FORT COLLINS PROFIT SHARE PAYOUT ILLUSTRATION Arthur]. Gallagher & Co. Response to RFP MdC1ient.do6FTC0LLIMRF"C 03 RFP.dm Page 47 CITY OF FORT COLLINS COLORADO PUBLIC ENTITY RISK PURCHASING GROUP (CPERG) PROFIT SHARE PAYOUT ILLUSTRATION 2003 CALENDAR YEAR PROFIT SHARE PAYOUT POLICY YEAR ITERATION PROFIT SHARE AMOUNT STATUS PAYMENT DATE 1999 3rd $26,823 Estimated July 2003 2000 2nd $5,388 Paid March 2003 2001 1 S` $771 Paid March 2003 TOTAL: $32,982 2004 CALENDAR YEAR PROFIT SHARE PAYOUT POLICY YEAR ITERATION PROFIT SHARE AMOUNT STATUS PAYMENT DATE 2000 3'd $26,944 Estimated' July 2004 2001 2nd $1,157 Estimated' March 2004 2002 1 S` $5,067 Estimated ' March 2004 TOTAL: $33,168 Estimates are based off of CPERG loss runs as of the last CPERG meeting on May 16, 2003. Arthur J. Gallagher & Co. Response to RFP MACVentdmkFTCOLLINIRFNFC 03 RFP.doc Page 48 iiCITY OF FORT COLLINS MARKET PREFERENCES BY BROKER Arthur J. Gallagher & Co. Response to RFP M3CVent.do NFTC0LLIN\RFP\FC03 RFPAd Page 49 CITY OF FORT COLLINS MARKET PREFERENCES Below are our suggested markets in order of preference. Liability markets included both Victor O. Schinnerer/Royal and SIRPRO/Kemper. Currently both of these programs have lost their reinsurance and are not writing any renewal or new business. They are in the process of securing new reinsurance arrangements to support their programs, however, due to the unknown, we have given these options lower -priority. We will keep you apprised of the status as we continue to monitor the progress of these two programs and any other situations that may arise. ADMITTED IN INSURERS BESTS COLORADO (USrED IN ORDER OF PREFERENCE) RATING (YES OR NO) Public Entity Liability (GL / AL / LEL / POL) 1. Genesis A+ + XV Yes 2. Munich American A++ XV Yes 3. St. Paul A XV Yes 4. Clarendon A X Yes txcess Workers Compensation 1. Safety National A VIII Yes 2. Midwest Employers A XI Yes 3. ACE A XII Yes Property 1. Travelers A+ + XV Yes 2. AI I ianz A XV Yes 3. FM Global A+ XIV Yes 4. Royal — CRC A XIV Yes 5. St. Paul Insurance Co. A XV Yes Equipment Breakdown 1. Travelers A+ —+XV Yes 2. Hartford Steam Boiler & A+ XV Yes Inspection Co. 3. Zurich A XV Yes Employee Dishonestv / Crime 1. Travelers A+ + XV Yes 2. CNA A XV Yes 3. Great American A XIII Yes 4. AIG A++ XV Yes 5. St. Paul A XV Yes Arthur J. Gallagher & Co. Response to RFP MAClient.docAFTCOLLIN\RFRFC 03 RFPAd Page 50 CITY OF FORT COLLINS SAMPLE BROKER SERVICE PLAN ArthurJ. Gallagher & Co. Response to RFP MAClien[.dm\FTCOLLIN\RFP\FC 03 RFPAd Page 51 CITY OF FORT COLLINS 2003 SAMPLE BROKER SERVICE PLAN Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec RISK IDENTIFICATION ACTIVITIES 1 Exposure analysis ■ Hard copy loss runs ■ Current schedules / financials ■ List of under/ uninsured insurables 1 Coverage analysis 1 Coordinate insurance company services ■ Inspections ■ Response to any risk control recommendations RISK FINANCING 1 Marketing ■ Develop Marketing strategy with City Risk Management ■ Collect UW Data from City ■ Market coverages as agreed / negotiations with Underwriters ■ Proposals to risk 1 Retention analysis ■ Collect loss data ■ Request loss information from carriers 1 Evaluate risk financing alternatives ■ Retention / deductible alternatives ■ Aggregate / corridor deductibles — = Completed — Not Completed — = Work In Progress r\r nur I. Uai iagner & C.o. — Denver Pape 52 MACGi .t dM\FTMI I W \RFP�Fr M RFP M O Submittal Section — RFP V895 Failure to return this submittal page with your qualifications will be cause for rejection Please address the following in the order listed below: Name of Company. 2. Provide the names and telephone numbers of at least 5 (five) references. Provide any previous and current local government experience. These should include other public entity accounts. Identify the type of service provided for each reference and the length of time your firm has handled the account. 3. (Describe any special expertise your firm has in providing insurance brokerage services to a City). Does your company have any proprietary programs for government entities? How would the existence of such a program affect your firm's objectivity in the marketing of the City's insurance program? 4. What markets would you most likely approach, i, i order of preference, if chosen? DO NOT TIE UP MARKETS AT THIS TIME. Please provide a prospectus and financial rating of these markets. 5. Your qualifications to handle the City's insurance portfolio and capabilities for risk management services. a. Describe your office, its history, and how it works with the national office (or offices), if appropriate. Please identify all activities that are performed by the national office. b. Provide the names, qualifications, and location of each individual that would be assigned to the City's account. C. Provide information to us, which indicates the financial status of your firm. d. Does your agency retain full-time employees engaged in specialty areas such as in- house claims and loss control and safety services? Describe the services, level of availability and provide employees' names with a brief resume of their experience. 6. Please list the services that you can offer the City of Fort Collins and your approach to marketing and servicing our account. Or, please provide a copy of your customary service plan for accounts similar to the City. We realize that the services may be customized based on the needs of a particular customer. We are interested in knowing what your firm sees as critical service features. 7. The proposed cost of the services outlined in this RFP. Is the cost all-inclusive, or do certain services require additional fees? Please make it clear what your costs cover. the City of Fort Collins reserves the right to negotiate the scope of work and applicable costs with the selected vendor. 8. Please explain why you believe that you and your organization are the best party to represent the City in the marketplace and how your approach to client services and program is unique. 9. List what your firm believes to be the three most important responsibilities of a broker/agent and give a very brief example of how you have fulfilled these three responsibilities for one client. Also, please give reference information for this client. 03 CITY OF FORT COLLINS 2003 SAMPLE BROKER SERVICE PLAN Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec BROKER CONSULTING SERVICES 1 Third party contracts ■ Review contracts as required ■ Make recommendations on standard insurance and indemnity provisions 1 Risk management meetings • Review broker work plan ■ Report on market conditions ■ Review loss experience ■ Report on work in progress i Development of a three-year strategic risk management plan CLAIM MANAGEMENT SERVICES 1 Semi-annual claim reviews (with City) RPC RISK CONTROL SERVICES 1 Risk control ■ Meet with safety personnel ■ Review loss control manuals / procedures ■ Site inspections _ a Completed — — Not Completed — — Work In Progress nnllur J. Uanagner & 1—o. — uenver Page 53 MAC[wm d,k WCOI I INWRFC Oi RFP &, CITY OF FORT COLLINS 2003 SAMPLE BROKER SERVICE PLAN Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec ■ Risk control audit / recommendations to risk QUALITY SURVEY STEWARDSHIP REPORT ADMINISTER INSURANCE PORTFOLIO / Policy administration ■ Deliver policies within 90 days ■ Issue endorsements within 45 days Certificates issued within 24 hours Return Phone Calls 24 hours _ = Completed = Not Completed — = Work In Progress Arthur]. Gallagher & Co. — Denver Page 54 M kCIwM Arc\FTrnl I INN RPM Pr Ai RFP dl CITY OF WESTMINSTER CATASTROPHE MODELING SERVICES MAClient.do \FTCOLLIN\RFRFC 03 RFP.do Page 55 Public Entity and Scholastic Division .J Specialty Catastrophe Services, Inc. (SCSI) was formed as a joint venture between Arthur J. Gallagher & Co. subsidiaries, Risk Placement Services, Inc. and John P. Woods Co., Inc. to provide catastrophe modeling services to the insurance and reinsurance clients and/or prospective clients of the Group. Models Currently Available SCSI has licensed multiple catastrophe models from leading firms to provide our clients with state of the art technology. The models are used by many of the primary insurance companies and reinsurance companies doing business in the U.S. today. We feel it is important that our clients have access to several models in making key decisions involving their insurance/reinsurance programs. The major property perils modeled are Hurricane and Earthquake (including Fire -Following), however Tornado and Wind/Hail are also available. A probabilistic Flood model is in the final stages of development and will be available later this year, however we can provide site -specific Flood Zone information now. How do Models Work? Catastrophe models are based on state-of-the-art analytical techniques using thousands of storm or event simulations to provide probabilistic loss estimates. This can help quantify possible loss scenarios and the premiums needed by companies over certain specified time periods to fund for those losses. These simulations are based on comprehensive risk input information such as street address, construction type, year built, etc., which the client must provide. Complete information is important as assumptions made for less detailed data can cause the models to overestimate or underestimate catastrophe exposure. Insurance companies use the results from these models to help them identify, price and limit their catastrophe exposure within specified guidelines. Lou Estrema Sung Yim Newport Tower — 525 Washington Blvd. Jersey City, NJ 07310-1607 201-216-0265 4 kaeMh�ubMe ` Dave Williams Two Pierce Place Itasca, IL 60143-3141 630-285-3822 Fax 630-285-4020 Model Output Each report is customized based on the portfolio of risk being analyzed, however typically SCSI will provide Probable Maximum Loss scenarios (from 50 to 10,000 year return periods), Estimated Loss Costs (premiums) by county, as well as leading loss generators (locations, members, divisions etc.) depending on the criteria selected. The results are presented in tables, graphs and detailed maps. The results will hopefully provide you with a key decision making tool to assist you in determining limits to be purchased, the impact of various deductibles or possibly an approach to high loss generators for you to deal with from a risk management Lou Estrema Sung Yim Newport Tower — 525 Washington Blvd. Jersey City, NJ 07310-1607 201-216-0265 °.a °.25 °.2 0.15 0.1 0.05 °° 1 ] 3 4 3 6 7 8 9 10 11 17 perspective. Our staff has a wide range of experience, such as model development, catastrophe reinsurance pricing and insurance portfolio consultants who are available to assist with your needs. For more information, please contact your location representative. Dave Williams Two Pierce Place Itasca, IL 60143-3141 630-285-3822 Fax 630-285-4020 10. Provide support or recommendations regarding the effectiveness of the following timetable. Also, please provide acknowledgement as to acceptability of your completion of the attached analysis spreadsheets, if you were selected to assist the City in its renewal proc ess. SUBMITTAL PAGE RFP #P89b P895 Insurance, 5 year Bid Failure to sign and return this submittal page with your qualifications will be cause for rejection. Arthur J. Gallagher & Co. - Denver Company Name .James PBayne., Area Chairman Print Typ Name of er' Authorized Officer or Partner july,23, 2003 Sign of Biddees Authorize cer or Partner Date `NOTE: If Bidder is a corporation, set forth the legal name of the corporation together with the signature of the officer or officers authorized to sign contracts on behalf of the corporation_ If Bidder is a partnership, set forth the name of the firm together with the signature of the partner or partners authorized to sign contracts on behalf of the partnership_ Business address: 7900 East Union Avenne, ;suite 200 Denver, CO 80237 Telephone # 303-773-9999 Please Refer to Original ATTEST: 9,( for Corporate Seal cretary (Corporate Seal) Please Note: We acknowledge receipt of Addendum No. 1 - P895 insurance 5 year bid. 03 CITY OF FORT COLLINS RESPONSE TO SUBMITTAL SECTION QUESTIONNAIRE QUESTIONS 1-10 1. Name of Company. Arthur). Gallagher & Company - Denver 2. Provide the names and telephone numbers of at least 5 (five) references. Provide any previous and current local government experience. These should include other public entity accounts. Identify the type of service provided for each reference and the length of time your firm has handled the account. CLIENT REFERENCES PROPERTY AND CASUALTY — LEAD BROKER, KAREN GRAHAM Pitkin County, Colorado Ms. Amy Barwick Risk Manager 970-920-5242 Property Values: $61,386,106 Services provided: Brokerage and consulting services in placement of their Property, General Liability, Law Enforcement Legal, Crime, Public Officials Liability and Excess Workers Compensation coverages. Time on Account: 10 years (since 1993) Larimer County, Colorado Ms. Kate Tremblay Risk Manager 970-498-5962 Property Values: $147,750,000 Services provided: Brokerage and consulting services in placement of their Property, General Liability, Law Enforcement Legal, Crime, Public Officials Liability and Excess Workers Compensation coverages. Time on Account: 7 years (since 1996) ArthurJ. Gallagher & Co. Response to RFP MAClientdo %FTCOLLINIRFNFC 03 RFP.doc Page 1 CITY OF FORT COLLINS Colorado School Districts Self Insurance Pool Ms. Cheryle Sullivan Executive Director 303-722-2600 Property Values: $6,000,000,000 Services provided: Brokerage and consulting services in placement of Reinsurance placement (property, equipment breakdown and casualty (including GL/AL/SBLL) for over 160 school districts. Time on Account: 12 years (since 1991) University of Colorado Mr. John Honea Director of University Risk Management 303-492-1903 Property Values: $4,500,000,000 Services provided: Brokerage and consulting services in placement of their Property, General Liability, Crime, Educators Legal Liability, Excess Workers Compensation, Foreign Liability and Excess Workers Compensation, and Athletic Participants. Time on Account: 10 years (since 1993) Wyoming Local Governmental Liability Pool Monty Lauer Executive Director 307-638-1911 Services provided: Brokerage and consulting services in placement of their Liability coverage (GL, AL, LEL, Professional Liability and POL) for over 300 cities and counties Time on Account: 5 years (since 1998) Arthur J. Gallagher & Co. Response to RFP MdClienLdmNFTCOLLIN\RFP\FC 03 RFP.dm Page 2