Agenda Item #41
Solicit Input from the Board Regarding an Increase in the 2008-09 Budget to Buy a Higher Property Insurance Limit
On April 25, 2009 the Superintendent purchased a property insurance policy to cover the district's $1,806,924,709 in total insurable values for $4,281,713.74. The policy purchased will reimburse the district for damages related to fire, named windstorm, earthquake and other calamities except flood to a maximum of $48,000,000 after the deductible for the type of loss is applied to the building's repair or replacement value. The policy calls for all perils except flood and named windstorm/hurricane to have a $100,000 deductible. Flooding damage is limited to a maximum reimbursement of $10,000,000 and similar to a named windstorm/hurricane event is subject to a 5% per building value deductible. Though obtaining a $48,000,000 property insurance limit appears reasonable given the district's financial constraints and the current property insurance marketplace, there are risks associated with doing so. One of those issues is that the policy will in the event of a loss reduce our recovery $7,000,000 from what the board purchased last fiscal year. As a result, the Superintendent is asking the Board to discuss the option of purchasing additional insurance limits as presented in the attachments to this agenda item, or make no changes to the current property insurance limits purchased. Should the Board decide to purchase additional property insurance limits, the Board would need to authorize an increase in the 2008-09 budget to purchase increased coverage. After hearing the Board's discussion, The Superintendent will bring a recommendation to the Board for approval at the May 26, 2009 Board Meeting.
To obtain the Board's recommendation to increase the budget to purchase a higher limit of property insurance or keep the existing policy and terms.
Information - 4/28/2009
Consent after Information5/26/2009
Authority for Action
Board Policy 8710 - Florida Statute 1001.42(11)(d)
Involves Expenditure of Funds Directly in the Classroom
Source of Funding
Operating - Other
Mark Langdorf, Director of Risk Management - Ext. 616
Judy Preston, Associate Supt. of Finanacial Services - Ext. 600
Attachment: 2009-10 Wind Modeling Study.pdf
Attachment: 2009-10 Property Ins Policy Comparison.pdf