HomeMy WebLinkAbout08/06/2013 05F Casualty Insurance Broker and Risk Management Contract with Wells Fargo Insurance Services USA, Inc.BUSINESS OF THE CITY COUNCIL
YAKIMA, WASHINGTON
AGENDA STATEMENT
Item No. S
For Meeting of: 8/6/2013
ITEM TITLE: Resolution authorizing Professional Services Contract for
property and casualty insurance broker and risk management
services with Wells Fargo Insurance Services USA, Inc.
SUBMITTED BY: Cindy Epperson, Budget & Finance Director
Helen Harvey, Senior Assistant City Attorney
SUMMARY EXPLANATION:
This resolution authorizes approval and execution of a contract for property and casualty
insurance broker and risk management services with Wells Fargo Insurance Services USA, Inc.
( "Wells Fargo "). The City's insurance broker advises the City on insurance coverage and
markets its insurance coverage for various types of insurance, including property, excess
liability and excess workers compensation insurance. Joel Pearson of Wells Fargo works on the
Wells Fargo service team, and has provided insurance and risk management services to the
City since the 1980s. The current contract with Wells Fargo will expire August 31, 2013.
The proposed' insurance broker contract is for a one -year period commencing September 1,
2013 through August 31, 2014. The compensation under the Contract is $75,000, to be paid in
three installments. Due to a significant increase over the years in the volume of work and
services provided by Wells Fargo, the amount is an increase of $15,000 from $60,000 per year,
which amount had remained the same without any increase for the last three
years. Furthermore, Wells Fargo has added additional services such as an online certificate of
liability insurance tracking program being utilized extensively by the Purchasing Division and a
free web -based safety and compliance training tool for City employees with OSHA oriented
courses ( "Summit Online Training "), and now handles insurance coverage for the Yakima Air
Terminal. Based on the high caliber of work that Wells Fargo has provided to the City in the
past, staff is recommending that the City continue to contract with Wells Fargo for the City's
critical insurance coverage, broker and risk management services.
Resolution: X
Ordinance:
Other (Specify):
Contract: X Contract Term: .1 year
RESOLUTION NO. R -2013-
A RESOLUTION authorizing the City Manager of the City of Yakima to execute a
professional services contract for property and casualty insurance broker
and risk management services with Wells Fargo Insurance Services
USA, Inc.
WHEREAS, the City of Yakima requires professional services related to insurance
brokerage services for property and casualty insurance broker and risk management services
for the City of Yakima; and
WHEREAS, the City's current contract for property and casualty insurance broker and
risk management services expires on August 31, 2013; and
WHEREAS, Wells Fargo Insurance Services USA, Inc. represents that it has the
expertise necessary and is willing to perform the professional services required by the City in
accordance with the terms and conditions of the Contract; and
WHEREAS, the City of Yakima and Wells Fargo Insurance Services USA, Inc. desire to
enter into a Professional Services Contract for property and casualty insurance broker and risk
management services for a one -year term, from September 1, 2013 through August 31, 2014;
and
WHEREAS, the City Council finds it to be in the best interest of the City to authorize the
City Manager to execute a Professional Services Contract for property and casualty insurance
broker and risk management services with Wells Fargo Insurance Services USA, Inc.; now,
therefore,
BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF YAKIMA:
The City Council authorizes the City Manager to execute the attached professional
services contract for property and casualty insurance broker and risk management services
with Wells Fargo Insurance Services USA, Inc.
ADOPTED BY THE CITY COUNCIL this day of August, 2013.
Micah Cawley, Mayor
ATTEST:
City Clerk
THIS PROFESSIONAL SERVICES CONTRACT is made and entered into by and
between the City of Yakima, a Washington municipal corporation (hereinafter the "City"), and
Wells Fargo Insurance Services USA, Inc. ("Wells Fargo") (hereinafter the "Contractor").
WHEREAS, the City of Yakima requires professional services related to insurance
brokerage services for Property & Casualty Broker and Risk Management Services for the City
of Yakima;
WHEREAS, the Contractor represents that it has the expertise necessary and is willing to
perform the professional services required by the City in accordance with the terms and
conditions of this Contract;
NOW, THEREFORE, in consideration of the mutual covenants, promises, and
agreements set forth herein, it is agreed by and between the City and Contractor as follows:
Section 1. Scope of Work
1.1 The minimum services that the Contractor will provide include:
(a) Market and advise the City on its insurance coverage;
(b) Prepare claims reports when requested by the City;
(c) Provide risk management services, including but not limited to review of vendor
certificates of insurance to meet contract requirements; advise on wording for
insurance requirements and the amounts of appropriate insurance coverage in City
contracts; and training for City personnel as required.
1.2 Contractor shall provide the services and staff described in the text of the Professional
Services Contract, including the services described in Exhibit "A", which is incorporated
herein by this reference. The services are included within the base fee. The Professional
Services Contract and Exhibit "A" are referred to herein as the "Contract." The Contract
specifies the working relationship between the City and the Contractor, and specific
obligations of both parties.
1.3 Except as otherwise specifically provided in this Contract, Contractor shall furnish the
following, all as the same may be required to perform the services described in
paragraph 1.1 in accordance with this Contract: personnel, labor and supervision; and
technical, professional and other services. All such services, property and other items
furnished or required to be furnished, together with all other obligations performed or
Professional Services Contract
Between City of Yakima and Wells Fargo
Insurance Services USA, Inc.
required to be performed, by Contractor under this Contract are sometime collectively
referred to in this Contract as the "Services."
1.4 All provisions of this Contract are intended to be complementary, and any Services
required by one and not mentioned in another shall be performed to the same extent as
though required by all. Details of the Services that are not necessary to carry out the
intent of this Contract, but that are not expressly required, shall be performed or furnished
by Contractor as part of the Services, without any increase in the compensation otherwise
payable under this Contract.
Section 2. Period of Performance
2.1 The period of performance under this Contract will be one (1) year, commencing on
September 1, 2013, and continuing until August 31, 2014.
Section 3. Compensation
3.1 As full compensation for satisfactory performance of the Services, City shall pay
Contractor Seventy-Five Thousand Dollars ($75,000.00) for the professional services
pursuant to this Contract.
3,2 The annual fee shall be paid by the City to Contractor in three installments, in four-month
intervals. The three invoices will be submitted by Contractor to the City of Yakima on or
about January 1, 2014, May 1, 2014, and September 1, 2014. The first invoice will be
submitted on or about January 1, 2014,
3.3 City of Yakima shall pay each of Contractor's invoices within thirty (30) days after the
City's receipt and verification thereof, provided, however, that all such payments are
expressly conditioned upon Contractor providing services hereunder that are satisfactory
to the City.
3.4 Any additional service(s) provided by the Contractor which are to be paid by the City
must have prior written approval of the City.
Section 4. Performance by Contractor
4.1 Delegation of Professional Services. The services provided for herein shall be performed
by Contractor, and no person other than regular associates or employees of Contractor
shall be engaged on such work or services. Contractor shall not (by contract, operation of
law or otherwise) delegate or subcontract performance of any Services to any other
person or entity without the prior written consent of the City. Any such delegation or
subcontracting without the City's prior written consent shall be voidable at the City's
option.
No delegation of subcontracting of performance of any of the Services, with or without
the City's prior written consent, shall relieve Contractor of its responsibility to perform
Professional Services Contract -2-
Between City of Yakima and Wells Fargo
Insurance Services USA, Inc.
the Set-vices in accordance with this Contract. Contractor shall be fully responsible for
the performance, acts and omissions of Contractor's employees, Contractor's
subcontractors, and any other person who performs or furnishes any Services
(collectively, the "Support").
4.2 Contractor shall at all times be an independent contractor and not an agent or
representative of the City with regard to performance of the Services. Contractor shall
not represent that it is, nor hold itself out as, an agent or representative of the City. In no
event shall Contractor be authorized to enter into any agreement or undertaking for or on
behalf of the City.
43 Contractor shall perform the Services in a timely manner and in accordance with the
standards of the profession. At the time of performance, Contractor shall be properly
licensed, equipped, organized, and financed to perform the Services in accordance with
this Contract. Subject to compliance with the requirements of this Contract, Contractor
shall perform the Services in accordance with its own methods.
4.4 Contractor shall take all reasonable precautions to protect against any bodily injury
(including death) or property damage that may occur in connection with the Services.
Section 5. Compliance with Laws
5.1 Contractor shall comply with all applicable laws, ordinances, rules, regulations, orders,
licenses, permits, and other requirements, now in effect, of any governmental authority
(including, but not limited to, such requirements as may be imposed upon the City and
applicable to the Services). Contractor shall furnish such documents as may be required
to effect or evidence such compliance. All laws, ordinances, rules and orders required to
be incorporated in agreements of this character are incorporated in this Contract by this
reference.
Section 6. Taxes and Assessments
6.1 Contractor shall be solely responsible for and shall pay all taxes, deductions, and
assessments, including but not limited to federal income tax, FICA, social security tax,
assessments for unemployment and industrial injury insurance, and other deductions from
income which may be required by law or assessed against either party as a result of this
Contract. In the event the City is assessed a tax or assessment as a result of this Contract,
Contractor shall pay the same before it becomes due.
Section 7. Nondiscrimination Provision
7.1 During the performance of this Contract, Contractor shall not discriminate in violation of
any applicable federal, state and/or local taw or regulation on the basis of race, age, color,
sex, religion, national origin, creed, marital status, disability, honorably discharged
veteran or military status, pregnancy, sexual orientation, political affiliation, or the
presence of any sensory-, mental or physical handicap, and any other classification
Professional Services Contract -3-
Between City of Yakima and Wells Fargo
Insurance Services USA, Inc.
protected under federal, state, or local law. This provision shall include but not be
limited to the following: employment, upgrading, demotion, transfer, recruitment,
advertising, layoff or termination, rates of pay or other forms of compensation, selection
for training, and the provision of Services under this Contract.
Section 8. Inspection: Examination of Records
8.1 The records relating to the Services shall, at all times, be subject to inspection by and
with the approval of the City, but the making of (or failure or delay in making) such
inspection or approval shall not relieve Contractor of responsibility for performance of
the Services in accordance with this Contract, notwithstanding the City's knowledge of
defective or non-complying performance, its substantiality or the ease of its discovery.
Contractor shall provide the City sufficient, safe, and proper facilities and equipment for
such inspection and free access to such facilities.
8.2 Contractor shall promptly furnish the City with such information which is related to the
Services of this Contract as may be requested by the City. Until the expiration of three
(3) years after final payment of the compensation payable under this Contract, Contractor
shall provide the City access to (and the City shall have the right to examine, audit and
copy) all of Contractor's books, documents, papers and records which are related to the
Services of this Contract.
Section 9. Property and Confidential Information
9.1 Contractor shall not, without the prior written consent of the City, disclose to third parties
any information received in connection with the Services unless:
(a) information is known to Contractor prior to receiving the same directly or
indirectly in connection with the Services;
(b) information is in the public domain at the time of disclosure by Contractor; or
(c) information is received by Contractor fi-om, a third party who does not have an
obligation to keep the same confidential.
Section 10. Indemnification and Hold Harmless
10.1 Contractor agrees to protect, defend, indemnify, and hold harmless the City, its elected
officials, officers, employees and agents from any and all claims, demands, losses, liens,
liabilities, penalties, fines, lawsuits, and other proceedings and all judgments, awards,
costs and expenses (including reasonable attorneys' fees and disbursements) resulting
from death or bodily injury to any person or damage or destruction to a third party or
third parties to the extent caused by any negligent act and/or omission of the Contractor,
its officers, employees, agents, and/or subcontractors, arising out of the performance of
this Contract.
Professional Services Contract -4-
Between City of Yakima and Wells Fargo
Insurance Services USA, Inc.
10.2 Nothing contained in this Section or this Contract shall be construed to create a liability
or a right of indemnification in any third party.
Section 11. Insurance Provided by Contractor
11.1 At all times during performance of the Services, the Contractor shall secure and maintain
in effect insurance to protect the City and the Contractor from and against all claims,
damages, losses, and expenses arising out of or resulting from the performance of this
Contract. Contractor shall provide and maintain in force insurance in limits no less than
that stated below, as applicable. The City reserves the right to require higher limits
should it deem it necessary in the best interest of the public.
11.2 Commercial Liability Insurance. Before this Contract is fully executed by the parties,
Contractor shall provide the City with a certificate of insurance as proof of commercial
liability insurance with a minimum liability limit of Five Million Dollars ($5,000,000,00)
per occurrence combined single limit bodily injury and property damage, and Five
Million Dollars ($5,000,000.00) general aggregate. If Contractor carries higher coverage
limits, such limits shall be shown on the Certificate of Insurance and Endorsements and
the City of Yakima, its elected officials, officers, agents, and employees shall be named
as additional insureds for such higher limits. The certificate shall clearly state who the
provider is, the coverage amount, the policy number, and when the policy and provisions
provided are in effect. Said DOliCV shall be in effect for the duration of this Contract. The
policy shall name the City of Yakima, its elected officials, officers, agents, and
employees as additional insureds, and shall contain a clause that the insurer will not
cancel or change the insurance without first giving the City thirty (30) calendar days prior
written notice. The insurance shall be with an insurance company or companies rated
A-VII or higher in Best's Guide and admitted in the State of Washington.
11.3 Commercial Automobile Liability Insurance. Before this Contract is fully executed by
the parties, Contractor shall provide the City with a certificate of insurance as proof of
commercial automobile liability insurance with a minimum liability limit of Five Million
Dollars ($5,000,000.00) per occurrence combined single limit bodily injury and property
damage. If Contractor carries higher coverage limits, such limits shall be shown on the
Certificate of Insurance and Endorsements and the City of Yakima, its elected officials,
officers, agents, and employees shall be named as additional insureds for such higher
limits. Automobile liability will apply to "Any Auto" and be shown on the certificate.
The certificate shall clearly state who the provider is, the coverage amount, the policy
number, and when the policy and provisions provided are in effect. Said policy shall be
in effect for the duration of this Contract. The policy shall name the City of Yakima, its
elected officials, officers, agents, and employees as additional insureds, and shall contain
a clause that the insurer will not cancel or change the insurance without first giving the
City thirty (30) calendar days prior written notice. The insurance shall be with an
insurance company or companies rated A-VII or higher in Best's Guide and admitted in
the State of Washington.
Professional Services Contract -5-
Behveen City of Yakima and Wells Fargo
Insurance Services USA, Inc.
11.4 Professional Liability Insurance. Before this Contract is fully executed by the parties,
Contractor shall provide the City with a certificate of insurance as evidence of
Professional Errors and Omissions Liability Insurance with coverage of at least Ten
Million Dollars ($10,000,000.00) per occurrence and an annual aggregate limit of at least
Ten Million Dollars ($10,000,000.00). The certificate shall clearly state who the provider
is, the amount of coverage, the policy number, and when the policy and provisions
provided are in effect. The insurance shall be with an insurance company rated A-VII or
higher in Best's Guide. If the policy is on a claims made basis, the retroactive date of the
insurance policy shall be on or before the inception date of the Contract, or shall provide
full prior acts. The insurance coverage shall remain in effect during the term of this
Contract and for a minimum of three (3) years following the termination of this Contract.
Section 12. Changes
12.1 The City may, at any time by written notice thereof to Contractor, make changes in the
Services within the general scope of this Contract (including, but not limited to, additions
to or deletions from any Services, suspension of performance and changes and location of
performance).
12.2 If any change under paragraph 12.1 causes a significant increase or decrease in the cost of
the time required for performance of the Services, an equitable adjustment in the
compensation and schedules under this Contract shall be negotiated to reflect such
increase or decrease, and this Contract shall be modified in writing accordingly. Such
equitable adjustment shall constitute full compensation to Contractor for such change. If
any change under paragraph 12.1 results in a decrease in the Services to be performed,
Contractor shall not be entitled to anticipated profit on Services not performed and the
loss of anticipated profit shall not reduce the decrease in compensation under this
Contract resulting fi-om such exchange. Further, Contractor shall not be entitled to any
reallocation of cost, profit or overhead.
12.3 Notwithstanding any dispute or delay in arriving at a mutually acceptable equitable
adjustment under paragraph 12.2, Contractor shall immediately proceed with
performance of the Services as changed pursuant to paragraph 12.1. If Contractor intends
to assert a claim for equitable adjustment under paragraph 12.2, Contractor must, within
sixty (60) days after Contractor's receipt of any notice under paragraph 12.1 that does not
set forth an acceptable adjustment, submit to the City a written statement of the basis and
nature of the adjustment claimed. Contractor shall not be entitled to any adjustment
unless such written statement is submitted by Contractor to the City within the applicable
period.
Section 13. Termination
13.1 The City may, by giving the Contractor thirty (30) calendar days written notice of
termination, terminate this Contract as to all or any portion of the Services not then
performed, whether or not Contractor is in breach or default, and with or without cause.
Upon receipt of any such notice of termination, Contractor shall, except as otherwise
Professional Services Contract -6-
Between City of Yakima and Wells Fargo
Insurance Services USA, Inc.
directed by the City, immediately stop performance of the Services to the extent specified
in such notice. Contractor shall have the same termination rights as the City in
Section 13.
13.2 In the event of termination pursuant to paragraph 13.1, an equitable adjustment shall be
made in the compensation payable to Contractor under this Contract, provided that such
compensation as so adjusted shall in no event exceed a percentage of the total
compensation otherwise payable under this Contract equal to the percentage of the
Services satisfactorily completed at the time of termination. Further, Contractor shall not
be entitled to any reallocation of cost, profit or overhead. Contractor shall not in any
event be entitled to anticipated profit on Services not performed on account of such
termination. Contractor shall use its best efforts to minimize the compensation payable
under this Contract in the event of such termination.
13.3 If the City purports to terminate or cancel all or any part of this Contract for Contractor's
breach or default when Contractor is not in breach or default which would permit such
termination or cancellation, such termination or cancellation shall be deemed to have
been a termination by the City pursuant to paragraph 13.1 and the rights of the parties
shall be determined accordingly.
Section 14. Miscellaneous
14.1 Assignment. This Contract, or any interest herein, or claim hereunder, shall not be
assigned or transferred in whole or in part by Contractor to any other person or entity
without the prior written consent of the City. In the event that such prior written consent
to an assignment is granted, then the assignee shall assume all duties, obligations, and
liabilities of Contractor stated herein.
14.2 No Conflict of Interest. Contractor represents that it or its employees do not have any
interest and shall not hereafter acquire any interest, direct or indirect, which would
conflict in any manner or degree with the performance of this Contract. Contractor
further covenants that it will not hire anyone or any entity having such a conflict of
interest during the performance of this Contract.
14.3 No Insurance. It is understood that the City does not maintain liability insurance for
Contractor and/or its employees.
14.4 Severabifty. If any portion of this Contract is changed per mutual agreement or any
portion is held invalid, the remainder of the Contract shall remain in full force and effect.
14.5 Integration. This written document constitutes the entire agreement between the City and
Contractor. There are no other oral or written Contracts between the parties as to the
subjects covered herein. No changes or additions to this Contract shall be valid or
binding upon either patty unless such change or addition be in writing and executed by
both parties.
Professional Services Contract -7-
Between City of Yakima and Wells Fargo
Insurance Services USA, Inc.
14.6 Notices. Unless stated otherwise herein, all notices and demands shall be in writing and
sent or hand delivered to the parties to their addresses as follows:
TO CITY: Cindy Epperson, Finance & AND TO:
Budget Director
City of Yakima Finance Department
City Hall — First Floor
129 North Second Street
Yakima, WA 98901
Helen A. Harvey
Senior Assistant City Attorney
City of Yakima Legal Department
200 South Third Street
Yakima, WA 98901
TO CONTRACTOR: Joel Pearson, Managing Director, Central Washington Offices
Wells Fargo Insurance Services USA, Inc.
1430 North 16th Avenue
P. 0. Box 2547
Yakima, WA 98907
or to such other addresses as the parties may hereafter designate in writing. Notices
and/or demands shall be sent by registered or certified mail, postage prepaid, or hand
delivered. Such notices shall be deemed effective when hand delivered at the addresses
specified above, or three (3) days after the date of mailing to the addresses specified
above.
14.7 Governing.Law. This Contract shall be governed by and construed in accordance with
the laws of the State of Washington.
14.8 Venue. The venue for any action to enforce or interpret this Contract shall lie in the
Superior Court of Washington for Yakima County, Washington.
Professional Services Contract
Between City of Yakima and Wells Fargo
Insurance Services USA, Inc.
CITY OF YAKIMA
By nrke, —City Manager
Date:
-By__
City Clerk
City Contract No. �
Resolution No.:
STATE OF WASHINGTON )
)Ss.
COUNTY OF YAKIMA
WELLS FAR GO INSURANCE SERVICES
USA, INC.
Date:
DATED this 3 0 day o �, 2013.
v 1.17
Professional Scryiew; Contract -9-
Between City of Yakima and Wells Fargo
insurance Services USA, lao:
EXHIBIT A
TO PROFESSIONAL SERVICES CONTACT
All services will be provided by the Yakima Wells Fargo Insurance Services USA, Inc. offices.
Services included within the base fee:
BROKERAGE SERVICES
• Exposure Identification and Evaluation
• Insurance Program Audit (The Review of Existing Insurance Policies to Determine
Adequacy of Coverage, Adequacy of Limits, Appropriate Deductible/Retention Levels,
Significant Restrictions in Coverage, the Existence of Warranties, Concurrency of
Coverage, Duplications or Gaps in Coverage, Suitability of Forms, Financial Stability of
Insurers and Insurer Service Capability)
• Insurance Program Design (The Drafting of Insurance Policy Specifications to Address
Exposures to Loss Confronting Client)
• Property, Casualty and Marine Marketing of Coverages and Related Services:
• The Preparation of Appropriately Detailed Coverage Specifications
• The Submission of Specifications to Selected Markets/Vendors
• The Negotiation of Coverage and Pricing at Decision Making Level
• The Evaluation of Alternatives in Accordance with Client Determined Priorities
• The Preparation of Presentation and Recommendations to Client
• The Verification of all Requested New and Renewal Policy Terms, Conditions, Rates and
Premiums
• The Verification of Insurance Company Audit Calculations if Applicable
• The Allocation of Premiums and Premium Adjustments
• The Review of Client's Contracts (Indemnification Agreements and Insurance
Requirements)
• Certificate of Insurance Review for Compliance
• The Monitoring of Insurance Company Services
• The Monitoring of Insurer Security
Professional Services Contract -10-
Between City of Yakima and Wells Fargo
Insurance Services USA, Inc,
• Insurance Company Liaison Activities (Troubleshooting)
• Day-To-Day Insurance/Risk Management Advice and Counsel
• The Preparation of Insurance Certificates
• The Preparation of Insurance Data for Client's Audits
• The Maintenance of Client Service Records
• Annual Service Planning
• In Depth Annual Account Reviews
• Annual Stewardship Reports
• Provide Ebix Certificate Tracking Program
RISK MANAGEMENT SERVICES
• Analysis of Pools and Self-Insurance Plan
• Periodic Evaluation of Loss Data with Appropriate Action Recommendations
• Monitoring of Insurance Company or Independent Risk Control Services
• Review and Negotiation of Insurer Fire Protection Engineering Recommendations
• Assistance in Selecting Insurance Company/Independent Risk Control Service Providers
• Day-to-Day Advice and Counsel on Risk Control Related Matters
• Boiler and Machinery Surveys—Monitoring Carrier Services
• Training to City Personnel on Insurance Coverage Issues and Obtaining Proper
Certificates of Liability Insurance
• Provide "Summit Training" Web-Based Safety and Compliance Training Tool accessible
from City offices
Professional Services Contract
Between City of Yakima and Wells Fargo
Insurance Services USA, Inc.
CLAIMS MANAGEMENT SERVICES
• The Monitoring of Insurance Company or Independent Claims Services
• The Resolution of Coverage Questions/Disputes in a Timely and Amicable Fashion
• Assistance in Locating Qualified Defense Counsel when Special Expertise /Technical
Experience is Required such as on Insurance Coverage Issues
• Day-to-Day Advice and Counsel on Claims Related Matters
• Evaluating Insurance Company or Vendor Service Performance
• Assistance in Preparation of Claims Reports for City Council if requested
Professional Services Contract -12-
Between City of Yakima and Wells Fargo
Insurance Services USA, Inc.