Presentation on theme: "State of Louisiana Office of Risk Management"— Presentation transcript:
1 State of Louisiana Office of Risk Management Property Consultant RFPUW-03
2 Pre-Proposal Conference Monday, July 25, 2011 Agenda Please sign-in on the attendance sheet!Overview of ORMProperty and Insurance InformationReview of RFPQuestion & Answer
3 ORM Overview Governed by LA R.S. 39:1527 et seq Self-insurance program Excess re-insurance purchasedMaintains inventory of all state-owned buildings and values of contents9,200 insured buildings - $16 Billion TIVFEMA Stafford Act Requirements
4 Property Program History Prior Katrina/Rita (2005):$25M SIR / $475,000,000 XS Limit / $6,950,000 Annual PremiumAfter Katrina/Rita ( ):$50M SIR / $150,000,000 XS Limit / $35,485,000 Annual PremiumAfter Gustav/Ike (2009+):$50M SIR / $150,000,000 Limits / $28,450,000 Annual premiumSummary of Property Coverage (on website)2007 & 2008 – wholesale broker was able to increase excess limits to $300,000,000 and $350,000,000 (above the SIR) respectively in these years.
5 Challenges Reduction in market capacity for coastal risks Following form exceptionsHigh SIRFlood InsurancePremium increases passed to insured agenciesHigh TIV in high-risk areasLimitations of the Procurement Code#1#2 ORM uses standard ISO forms and creates endorsements to change specific items, usually to broaden coverage rather than restrict it. Business interruption and extra expense issues, mold exclusions, fine art coverage at agreed values, etc.#3 Currently $50M (flood, wind and earthquake) with a sublimit of $25M AOP.#4 Currently, approx. 1,000 individual NFIP policies at a premium of $4.5M. Administratively burdensome. The S/I provides flood coverage for the remainder with no excess coverage. We would like to get flood coverage back into the excess and move away from NFIP. Tried to bid flood excess separately, but market wouldn’t bear it. We couldn’t get a separate set of limits for it.#5 Dramatic premium increases have affected the budgets of all insured agencies, especially affecting the small boards and commissions that have relatively small property values and budgets.#6 Concentration of property in New Orleans and Baton Rouge. High-valued structures: Superdome and New Orleans Arena, Charity Hospital (new University medical Center), LSU campus (450+ buildings)#7 Currently, we use the Invitation for Bid process as established by the Office of State Purchasing, which governs the purchase of commodities of which “insurance” is included. The bid process actually limits competition rather than enhancing it. We have received one quotation for the last several bid years.
6 Review of RFP Written Inquiries Deadline: August 1, 2011 4:00 pm CST Proposal Submission Deadline:August 17, :00 pm CSTAnticipated Contract Date:September 7, 2011
7 Supporting Documentation Located atSchedule of Property ValuesSummary of Property Coverage by Fiscal YearORM StatuteProcurement Code Statutes
8 Q & ACompany financial statements are private. Is there an alternative to submission or a way to protect them from public access?What are the primary reasons ORM is performing this study?Catastrophe modeling reports are very costly and require large amounts of data. Has ORM had these reports in the past and are we aware of the cost and data required?Will the Consultant be involved in the selection and placement of 2012 insurance program?What are the goals of the RFP?