Council disagrees over insurance
The decision to switch to a different company for liability insurance met with some concern and disagreement at a special Buckhannon City Council meeting.
The decision could not wait for an upcoming meeting because city officials were notified March 26 that the renewal of the liability insurance policy with Travelers was due April 1.
Following a fatal incident with trash collection in recent years and other incidents, Travelers has significantly increased its policy rates. The city of Buckhannon annually pays $141,000 for its liability insurance, but the quote that suddenly appeared on city officials’ desks last week incorporated a dramatic increase to $178,000 for the coverage.
“I don’t like Travelers doing this to us. I don’t think it’s right,” Councilman Dave Thomas said, adding the agency gave the quote with little notice before a decision was necessary.
City Treasurer and Administrator Michael Doss said the increase in the claims was largely due to the significant claims of “backing into vehicles and things of that nature.” He said he recommends the city change providers and accept a quote of $146,410 that was submitted by provider, One Beacon. That company was presented with all the same claims and information as Travelers, and there was a significant difference in the quotes.
“Looking at both quotes, they’re very comparable (for coverage). I think it’s pretty safe to say it’s close to an apples-to-apples comparison,” Doss said.
He said both were good providers of liability insurance. The possibility of switching the insurance roused some concern prior to its approval.
“My concern there would be, are we making a $32,000 savings this year?” Recorder Rich Clemens said. “If you look at over a five-year period, are they just trying to get our business this year and make it up over time? It seems to me the real issue here is the fact that we haven’t been able to control our losses with some repetitive kinds of accidents. Had we done a better job in the past year, we probably wouldn’t be faced with a $178,000 quote. I’m a little concerned about taking on a short-term approach.”
Clemens was the only one to vote against switching to One Beacon.
“This is not a one-term event. This will happen to us next April,” Clemens said.
Thomas said there was no way to know what the second-year quote would be until next year.
Both Travelers and One Beacon are “A-rate” providers, Thomas said, but One Beacon also is endorsed by the Municipal League, whereas Travelers is not. Doss said he felt that provided One Beacon with credibility.
Mayor Kenneth Davidson had one more concern.
“It’s a pretty good bet that Travelers is going to stay here and do business,” Davidson said, adding that One Beacon could decide to move out-of-state.
If the city of Buckhannon were to seek liability insurance as a new customer from its current provider, it wouldn’t qualify for coverage, said Jamie Powell with Loudin Insurance of Buckhannon.
Powell said the city wouldn’t qualify for a policy from many providers because of current claims. Despite all the concerns, the majority of city officials were in favor of giving One Beacon an opportunity.
“Sometimes we just have to shop around and look for the best thing for the city and our taxpayers,” Doss said.
All members except for Pam Cuppari and Scott Preston were present for a quorum at the meeting.