CC 03-05-03Archives
CITY OF
CUPEI TINO
AGENDA
CUPERTINO CITY COUNCIL - SPECIAL MEETING
10300 Torre Avenue, Council Chambers
Wednesday, March 5, 2003
6:00 p.m.
PLEDGE OF ALLEGIANCE
ROLL CALL
ORAL COMMUNICATIONS
This portion of the meeting is reserved for persons wishing to address the council on any matter
not on the agenda. Speakers are limited to three (3) minutes. In most cases, State law will
prohibit the council from making any decisions with respect to a matter not listed on the agenda.
NEW BUSINESS
1. Discuss insurance issue regarding the Lunar New Year Unity Parade.
ADJOURNMENT
In compliance with the Americans with Disabilities Act (ADA), the City of Cupertino will make
reasonable efforts to accommodate persons with qualified disabilities. If you require special
assistance, please contact the city clerk's office at 408-777-3223 at least 48 hours in advance oJ
the meeting.
CITY OF
CU EKT NO
Ihll
10300 Torte Avenue
Cupertino, CA 95014-3255
Telephone: (40g) 777-3220
FAX: (408) 777-3366
DEPARTMENT OF ADMINISTRATIVE SERVICES
SUMMARY
Agenda Item No.
Meeting Date: March 5, 2003
SUBJECT AND ISSUE
Providing insurance coverage for the Lunar New Year Unity Parade.
BACKGROUND
This Saturday is the first annual Lunar New Year Unity Parade (LNYUP). A separate, non-for-
profit committee has been working on this event for over one year. The city commitment is a
contribution of $10,000 plus in-kind service as is typical of other non-profit events held throughout
the year. Last Thursday, staff was asked if the City could provide insurance for the parade as none
had been found. No insurance coverage meant that the parade would have to be cancelled.
Our Human Resources Manager has been working diligently on this request and was able to obtain a
quote for special event insurance from Driver Alliant Insurance Company. The insurance identified
would have the City as the public entity insured and provide $1 million dollars in coverage. Any
additional exposure would be absorbed by the City through our ABAG plan. The cost of the
insurance is approximately $3,000. Current City practice is to require each event co-coordinator to
obtain their own special event insurance to limit the City's exposure for our numerous community
events in Cupertino.
As of Tuesday, March 4th, the LNYUP committee had received a quote for special event insurance
from K&K Insurance Group at the cost of $7,545 (see attached documents).
The pros of having the City obtain the insurance for this event are:
,/ Saves the LNYUP committee time and money.
The cons of having the City obtain the insurance for this event are: ¢ Incurs liability over $1 million dollars which would effect our future insurance rates;
,/ Sets a precedent of providing special event coverage for any non-for-profit that hosts a
community event;
,/ Exposes our general fund to unnecessary risks, which is not in the best interest of the
citizens;
,/ Increases staff workload for a non-city event.
Printed on Recycled Paper
RECOMMENDATION
Given the fact that the LNYUP comanittee now has a quote for insurance, staff recommends that the
Council stay with our existing policy and that we do not insure the parade.
Submitted by: Approved for submission:
Carol A. Atwood
Director of Administrative Services
David W. Knapp
City Manager
Carol Atwood
From:
Sent:
To:
Subject:
David Knapp
Wednesday, March 05, 2003 9:26 AM
Carol Atwood
FW: Lunar New Year Unity Parade (LNYUP), Effective MArch 8, 2003
Importance: High
03-04-03 Me~ to
Ric~a~ L re ... fyi
..... Original Message .....
From: Richard Lowenthal [mailto:richard@lowenthal.com]
Sent: Tuesday, March 04, 2003 4:25 PM
To: Michelle Hu; Kris Wang; Dave Knapp
Subject: FW: Lunar New Year Unity Parade (LNYUP), Effective MArch 8,
2003
Importance: High
Anot~ possibility -
RL
..... Original Message .....
From: Mark Sarjeant [mailto:msarjeant@attbi.com]
Sent: Tuesday, March 04, 2003 3:29 PM
To: Richard Lowenthal
Subject: Lunar New Year Unity Parade (LNYUP), Effective MArch 8, 2003
Importance: High
I have attached the quotation issued by K&K Insurance Group. I am willing to
meet with you &/or any other LNYUP representative(s) necessary to implement
this insurance (NOTE: K&K requires their Summary of Lines Quoted page be
signed!). Also, since premium is due to K&K PRIOR to any coverage being
bound, I recommend that if LNYUP wants to purchase this insurance that we
get together as soon as possible!
Sincerely,
Mark P. Sarjeant, CPCU
Pennbrook Insurance Services, Inc. - San Jose
(T) 408-863-0835 or 800-663-2728
Subject:
Insurer:
Lunar New Year Unity Parade (LNYUP)
Great American Assurance Company
Optional Coverages: Limit
Premium
Fireworks Liability
- Excess $1,000,000 $ 500
TOTAL PREMIUM:
California Insurance Guarantee Association (CIGA) Surcharge (2%):
$7,399.00
147.98
Total policy Cost:
$7,546.98*
Special Event Program Terms & Conditions
1. This quote is valid until March 7, 2003.
2. The policy will be written on the ISO Occurrence Form approved by the carrier (i.e., insurer) in
your state (i.e., California) and will not be subject to an annual audit.
3. Policy Minimum Premium is $2,500 earned at inception plus all applicable fees.
4. Coverage is contingent upon receipt & approval of the following within 30 days.
5. All binders, certificates and policies must be issued by K&K. Any such documents processed &/or
issued by any other manner will be considered null and void.
6. Although contractual hability will be provided K&K respectfully request that sample(s) of all types
of contracts entered (e.g., Pyro Spectacular's contract; etc.) into be submitted to K&K for review.
7. Any special activities that are scheduled to occur on the insured premises must be pre-reported to
K&K's office for review & endorsement (if appropriate).
8. Notable primary exclusions include, but are not limited to, the following liability exposures:
asbestos; nuclear energy; pollution with hostile fire exception; employment related practices;
airport/aircraft; testing, racing, practice, qualifying &/or sttmting of motorized vehicles including:
automobiles, snowmobiles, motorcycles, power boats, & other watercraft; rodeos; concerts;
fireworks; amusement devices (does not include video arcade or computer games); and participants
of class 5 sporting activities including, but not limited to, adventure races, judo, karate, martial
arts, Tae Kwon Do, trampoline, wresting (amateur, pro or Roman/Greco).
IMPROTANT NOTE: This proposal is only a very general reference to what coverage(s) the actual
insurance policy or policies provide(s) and is not intended to describe all details in the policy or policies of
insurance and is subject to all terms, provisions, conditions and exclusions as contained therein. You should
not rely upon this generalized summary, but review the actual policy or policies for complete description
and details regarding coverage.
NOTE (*): Due prior to binding. Premium pal~ment arrangements are available.
Date:
From:
To:
3/5/03
Mark P. Sarjeant, CPCU
Richard Lowenthal
Subject: Lunar New Year Unity Parade (LNYUP)
Richard:
In conjunction with my voicemail message that I just left for you, I just
received the following quotation from K&K Insurance Group, Inc.:
Insurer:
A.M. Best Rating:
Policy Form:
Policy Period:
Great American Assurance Company
AXII
Commercial General Liability Insurance
March 8, 2003 (12:01 A.M.) to
March 9, 2003 (12:01 A.M.)
Coverage
Limit Premium
Each Occurrence
General Aggregate
Products-Completed
Operations Aggregate
Personal & Advertising
Injury
Fire Damage Liability
Any One Fire
Premises Medical
Payments - Any One
Person
Deductible - Bodily
Injury (BI) & Property
Damage
$1,000,000 $6,899
Unlimited Included
$5,000,000 Included
$1,000,000 Included
$ 300,000 Included
$ 5,000 Included
$ NONE
EXIBITS
BEGIN
HERE
Summary, of Uni ,ty Parade Insurance Status .... 3/5/03
History
As of Febrnary 19th we had an insurance quote from Mark Sarjeant for $3500. See
attachment 1.
On February 26th, Mark informed us that he was unable to find an underwriter at any
premium. See attachment 2.
We then started the search for other underwriters.
Options
1) The city takes on the role as the property owner and gets insurance from Peggy
DeWitt of Driver Alliant, naming the Parade as an Additional Insured. This will
cost between $2,400 and $3000. Peggy has confirmed their ability to insure the
event. See attachment 3.
2) Kathy Ely WB Tubbs insurance can insure the event directly tbr $2233.13. See
attachment 4.
3) Mark Sarjeant has come back with a quote from K&K Insurance for $7,546.98.
See attachment 5.
Recommendation
I think the best thing for the parade and for the city is to go with option 1. My feeling is
that some people will view the city as liable for injury from the parade regardless of who
has the insurance coverage. With Option 1, the city will be insured directly as well as the
parade itself.
I think the downside of Option 1 would be that it might increase the expectation that the
city itself cover losses over the amounts that would be paid by the insurance. However, it
probably is tree that that expectation will he there independent of the option chosen.
Respectfully,
Richard Lowenthal
= H
_.,X IBIT
: c.- :-: Lowenthal
?
Mark Sarjeant [msarjeant@attbi.com]
Wednesday, February 19, 2003 9:50 AM
Richard Lowenthal
RE: Lunar NewYear Unity Parade (LNYUP) - March 8, 2003
-:,i,!ition to the repl3 tha~ T ~ent-:yes~_e=~ay,--r~y ~F ~_,f_fJ-ce i~formg~ me
:r~ning that~y Surety (NOTE: This was the original application
%,,~?-~ompleted.) is willing to write this insurance for @$3,500'r-' --2
-ts ~ ~ ~f ..... in~hic~,e~Tr %1~=i~ ~llda~lu~
~.~ -.~.,>.~-s demonstrations or displays will NOT be covered. However, they
r<>,~uire an insurance certificate from Pyro Spectacular showing
F~ :T ~: :~1 General Liability Limits of Liability at $1,000,000 Each
: , : c.~e & $1,000,000 Aggregate AND that LNYUP is named as an Additional
As regards the De ~za Lancers, I still reco~end that they should
~ ~ t~cipate in this event unless, as an organization or as individuals,
required to provide the same t~e of protection & confirmation as
:'~:ctacular~).
~';: The' above premium is only an indication.' ' Century Surety requires ~,'r
~.~,,,:,:-:i,:,'~!::~ac~Lar_Is_321allra~cP__C~rtificate before they will issue a form~
~ i:?.~A~so, you should note that their policy ~-~"be SubjeCt to ~
taxes & fees.
hard Lowenthal
:: :ject:
Mark Sarjeant [rnsarjeant@attbi.com]
Wednesday, February 26, 2003 2:46 PM
Richard Lowenthal
Lunar New Year Unity Parade (LNYUP) March 8, 2003 Event
;;, ortance: High
iN my unfortunate duty to inform you thatffwe have beenunsucces'sfu±--ln.~---v--~:-----------~----: i--
~ 'ainin. g any liabilmty insurance quotatlona~rom any .... o~ our insurance
~rces. You snoulG note tha~--w-~--f-u]5-m-~-~ed your organizatIon's appllcatmons
six different facilities (e.g., insurance companies; insurance surplus
I ~.'~s brokers; managing general agents; etc.) & none of them were able to
i':~d any underwriter willing to assume this event's risk for any premium.
~-efore, I want to re-recommend that the City of Cupertino should consider
uming sponsorship of this event, hold harmless & indemnify LNYUP &, if
:~ibly, name LNYUP as an Additional Insured on whatever insurance the city
have. I, personally, am disappointed in Pennbrook Insurance's inability
obtain this coverage at this time. However, we are experiencing an
~ ~:emely tight insurance market; & we have been having difficulty obtaining
:rance for many of our clients as well as prospective clients needs. If
City does not assume this event's risk, then I recommend that LNYUP
ild cancel it because I believe that self insuring these exposures is too
.~rdous. If you have any questions, please do not hesitate to let me know.
'~:erely,
~' P. Sarjeant, CPCU
brook Insurance Services,
~08-863-0835
Inc.
Richard Lowenthal
From:
Sent:
To:
Subject:
PdeWitt@driveralliant. com
Tuesday, March 04, 2003 1:04 PM
richard@lowenthal.com
Re: Urgent: Parade Insurance
Richard,
I have underwriter approval to cover this event for you. I will contact
Sandy Abe and advise her of this and what rate to be charged.
Regards,
Penny De Witt
Special Events--Account Administrator
Phone (949) 660-8163
Fax (949) 251-1663
License#0C36861
"Richard
Lowenthal"
<richard@lowen
thal.com>
03/04/2003
11:16 ~uM
Please respond
to richard
To: <pdewitt@driveralliant.com>
cc:
Subject: Urgent: Parade Insurance
Penny,
I finally got your proper email address - here goes again ....
Penny,
Thank you for your help.
The event is a parade down Stelling Road in Cupertino from Jollyman Park to
Memorial Park, followed by an International Fair at Memorial Park.
We are expecting attendance to be between 10,000 and 20,000 people.
There will be about 2500 participants in the parade itself, mostly
elementary school kids. All participants will sign a liability Release
Agreement.
The event will be on March 8, 2003. The parade starts at 10:30. The Fair
ends at 5 PM.
The event is called the Lunar New Year Unity Parade and will have some
firecrackers. The firecrackers are operated by a professional company,
Pyro Spectaculars. We are named as an Additional Insured on their
insurance certificate.
~AX: 40~-37 ~-2173
ATTN:
:'.-
conditions quoted ...... ' .................. ~ o ...... o. ,~ .... ~ -~ ~ ...... gt'..d it's
a.~iiated companies disclaim ""' .......... ~-:' ............ :'
¢c~,erage quot~ h~rcin.
CAR~"ER: Nort~,qeld .......... '~ .......
-POLICY-PERIOD: Sho~ Term (One Day 100% f~ily earned)
: lh-evaium $ 2,020.00
!. $,-~!us L~ T,_x $ 60.60
B~k~ ~'~ $ ' ~ ~
': POlicy Fee $
" : ~0~ -~"- 2,233.13
California ~$k
~ r 1. ~EE$ FLTLLY EARNED
This quote includc~ a broker fee irt a~Mition to the pr~nium(s) shown. According to thc Department o£
In~u~ for th~ ~tae of ~lifom~ prior approval for ~e c~ing of the ~oker f~c mu~ be ~ined
f~m ~c ~s~ By ord~ng ~verage ~d ~u hereby ~owl~ge .nd rep~ent t~t ~e Prior
a6~rov~ of the ~s~ has ~ obtaMed ~r ~e c~gi~ ora ~ok~ fcc. ~e p~oso of~is f~ is tbr
t~ m~keting semices prodded by Swen & C~wford G~up.
FROM : IJ B TUBBS [NSURRhlCE RGE[',ICY PH[.~',IE NLI, ; 4¢..18 571 21 t~ F. lar. ~J5 ~3 ~4:~2'F'~1 P2
INBURED:
~$ONAL AND ADV~RTI~IN~ IN. l~'Y ~ ~.~
~CML ~PENSE LIMIT
AND CO~ITIONa:
S2~184~
[] S/~910.-CG
[] S2577-C<3
ANY ONE PREMISF~S
ANY _ONE P~_~.$ON
TER. RORI~M Ri~K, INSURANCE ACT OF pnn~ n~rz~ ,~e~
PUMCY JAC~T
w~c~l~L ~ LIABIL~ CO~GE FORM (OCCURRENCE VE~SION~
FULLY ~RNE~ ~REM~UM
~ ~ P~ER~ DA~GE ~EDUCTIB~ LIA~ILI~
~uuA D~ST Slo~cG; ~CL-POL~TOTAL S42-1L; EXCL-PRO~IO~L SERVtCB~
~u~w~-u~iw ~t ~N S21~7-CG; ~MENDMENT. D~INITION LOADING
COM~INATION E~OR~M~T F
EXCLUSIONS: NEW E~TIE~. AMENDMENT n~ [~t I~ ~,,~
DAMA<3E; A~RC~, A~TO CE WATERCRA~. EMPLOYME~ R~n
~ ~bMP~RY DAMAGES. L~D, ASBESTOS, SILICA DU~T, P~LUTIO~TOTAL.
PA~OGEN~MENDMEN~9: DEPO~ & MIN. PREM~M; AM~DME~-DE~INJTION
CON~CTQRS COMBINATION
~CL-NEW ~TITI~G CG21~: ~END~ENT OF INSURIN~ AGR~MENT-~N~
SILICA DUST S10~G~; ~CL~OLL-TOTAL ~2-!L; ~XCL-~ROF~6~ON~ $~V~CE~
EXCgU~ON-O~GANIC ~ATHQGEN S~37-CG; ~CL~O~CTED PER~ON~
NON-EMPLOY~ ~BOR $1735~G; EXCL-EXTERiOR INSU~TION & FIN~ ~$TEM
~RK CA ~;~ECT-APPMED ~iOR FiNi6H SY-A~ WORK ~Z11
AMEND~NT-~IN/TION-LOkD!N~ OR JNLOA.~NG 8~ ~
AM~DM~T~O~CT~L LIABILI~
N~RENEW~
CONT~CTUAL L~iU~ LiMiTATION
.FROM : W B TUBBS INSURANCE AGENCY PHONE NO. : 408 371 2175 Map. g5 2003 04:03PM P3
T ,I~NAL TERMS AND CONr)ITION,~
F..~CLUSl O N-MEOICAL-COVERA<3 E
EXCLi.i$iON-,PF.R&ONAL AND ADVERTISING iNJURY
CLAGSIFICATION LIMITATION
F_.XCLUSlON-MECHANIC.A[, AMUSEMENT RIDE
EXCLUBION-A~,~AULT AND BATTERY
EXGLUSlO N-C-,OMMUNIC/~,I~ L~.
I~:X:C! LJ~ION,-ATNLI~TIC. pARTICIPANT & CONTE,_~J'ANTS
EXCLUSION-ABUSE OR MOLESTATION
EXCLUglON - INDEPENDENT CONTR~CTORB
E~CLUSlON-T, ANNIN~i
UH!TAT!O ~!NDEP~_NDE.NT ~ _.nNT.. R~CTOR~_
LIMITA'TION~JWlMMING POOLS W/O LIFEGUARD8
AMENDMENT-LIMIT~ OF INSURANCE..CARE, CUSTODY. OR. CONTROL
EXCLUSlON-LIQUOR-AB~3LUTE
EXCLUSION- Ph'Y$iCAL/',.3,EXUAL A~U~E
UMITATI 0;4-I NDr:P~-N ~w~.,qT CONT,"'.AO TOR~-SPECIFIE~ .......
ENDT-REQUIRED CERTIFICATE OF INSURANCE
SPE¢I,a~. EVENT COMa(= ENDORSEMENT (EXCL CONCERT PEI:~CORMER$. LIQUC)R,
VOLUNTARY LABOR, INJURY EXCL0100% FULLY EARNED PREMIUM)
LiMiTATiON OF COVERAGE TO
EXC, LU$1ON-^LL HAZARD - DESIGNATED PREMISES
EXCLUSION -PRODUCTS,~OMPLETED OPERATIONS
EXCLUSION-DESiGNATED PP. OFE~IONA[.
E×GLiJ&iON -E~Pi. GY~ES ~$ iNSURED'$
EYCLU$! 0.~. ¢OR m"C~_. A!
SPECIFIED HEALTH OR COSMETIC SERV1CES
PRO~UC?,~COMPLL=TF..D OPERATIC)NS HA;ZA~O R.EDEFINED
.-_r~ · .~;I~I-CG ADDITIONAL INSURED-SPECIFIED J--IPREMISES/r~'JOPERATIONS
: [~[; S494-CG ADDITIONAl. INSURED - ENDORSEMENT
' [] "~'~-CG ADDITIONAL INSURED. DE~I<3NATED CONTRACT
.. ~ ,,..~.cvuo ADC):TIONAL IN&URF-~ - CCh'TROLLING IN'TERF. C~T
· : ,~I~..:[ 'E~ ~ ADDITIONAL INSURED - VENDORS /_ ^
THERE WiLL JB~ AN ADDITIONAL P~MIUM ~F~LY ~RNED) CHARGED ~R ADDI~
IN~ URED E : ~:
~ORTH~ELD i~U~NCE CG~FANY ~ ~ ~T ~D ~'~
Date:
From:
To:
3/5/03
Mark P. Sarjeant, CPCU
Richard Lowenthai
Subject: Lunar New Year Unity Parade (LNYUP)
Richard:
In conjunction with my voicemail message that I just left for you, I just
received the following quotation from K&K Insurance Group, Inc.:
Insurer:
A.M. Best Rating:
Policy Form:
Policy Period:
Great American Assurance Company
AXII
Commercial General Liability Insurance
March 8, 2003 (12:01 A.M.) to
March 9, 2003 (12:01 A.M.)
Coverage
Limit Premium
Each Occurrence
General Aggregate
Products-Completed
Operations Aggregate
Personal & Advertising
Injury
Fire Damage Liability
Any One Fire
Premises Medical
Payments - Any One
Person
Deductible - Bodily
Injury (BI) & Property
Damage
$1,000,000 $6,899
Unlimited Included
$5,000,000 Included
$1,000,000 Included
$ 300,000 Included
$ 5,000 Included
SNONE
Subject:
Insurer:
Lunar New Year Unity Parade (LNYUP)
Great American Assurance Company
Optional Coverages: Limit
Premium
Fireworks Liability
- Excess $1,000,000 $ 500
TOTAL PREMIUM: $7,399.00
California Insurance Guarantee Association (CIGA) Surcharge (2%): 147.98
Total policy Cost: $7,546.98*
Special Event Program Terms & Conditions
1. This quote is valid until March 7, 2003.
2. The policy will be written on the ISO Occurrence Form approved by the carrier (i.e., insurer) in
your state (i.e., California) and will not be subject to an annual audit.
3. Policy Minimum Premium is $2,500 earned at inception plus all applicable fees.
4. Coverage is contingent upon receipt & approval of the following within 30 days.
5. All binders, certificates and policies must be issued by K&K. Any such documents processed
&/or issued by any other manner will be considered null and void.
6. Although contractual liability will be provided K&K respectfully request that sample(s) of all
types of contracts entered (e.g., Pyro Spectacular's contract; etc.) into be submitted to K&K for
review.
7. Any special activities that are scheduled to occur on the insured premises must be pre-reported to
K&K's office for review & endorsement (if appropriate).
8. Notable primary exclusions include, but are not limited to, the following liability exposures:
asbestos; nuclear energy; pollution with hostile fire exception; employment related practices;
airport/aircraft; testing, racing, practice, quali~ing &/or stunting of motorized vehicles
including: automobiles, snowmobiles, motorcycles, power boats, & other watercraft; rodeos;
concerts;fireworks; amusement devices (does not include video arcade or computer games); and
participants of class 5 sporting activities including, but not limited to, adventure races, judo,
karate, martial arts, Tae Kwon Do, trampoline, wresting (amateur, pro or Roman/Greco).
IMPROTANT NOTE: This proposal is only a very general reference to what coverage(s) the actual
insurance policy or policies provide(s) and is not intended to describe all details in the policy or policies of
insurance and is subject to all terms, provisions, conditions and exclusions as contained therein. You
should not rely upon this generalized summary, but review the actual policy or policies for complete
description and details regarding coverage.
NOTE (*): Due prior to binding. Premium paFment arrangements' are available.
EXIBITS
END
HERE