Oak Park and River Forest High School District 200 201 North Scoville Avenue  Oak Park, IL 60302-2296

TO: Board of Education

FROM: Cyndi Sidor, Chief Financial Officer

DATE: June 25, 2020

RE: Annual Renewal of Property, Casualty, Liability and Workers’ Compensation

BACKGROUND: This item was presented to the Committee of the Whole at its June 16, 2020 meeting at which time it was recommended that this item move forward to the Board of Education for approval at its June 25th meeting.

Oak Park and River Forest High School District 200 is a member of CLIC, the Collective Liability Insurance , which was formed 40 years ago. As of the May 14, 2020 renewal meeting, CLIC now has 185 members, insuring over 800 school buildings, almost 500,000 students and just over 4,000 vehicles and property values in excess of $21 billion. Each member school district has a specific to the coverage. This insurance pool is partially self-insured, and then insurance carriers provide the remaining protection.

The CLIC administrator is Arthur J. Gallagher Risk Management Service. Each year Gallagher reviews the coverage with the member districts, addresses legal requirements for the plan and then releases the coverage to the marketplace. Gallagher also provides safety inspections and Workers’ Compensation training for our employee groups to mitigate risk exposure.

SUMMARY OF FINDINGS: The total insurance package will increase by $19,240 or 3.48%. The specific details are listed in the table below:

Type of Coverage FY 2020 FY 2021 $ Difference % Difference Property, Casualty, Student Accident $190,418 $207,638 $17,220 9.04% Workers' Compensation 361,031 363,051 $2,020 0.56% Fiduciary Liability 2,050 2,050 0 0.00% Total $553,499 $572,739 $19,240 3.48%

Accompanying this cover letter are the following documents:

1. CLIC 2020-2021 Property/Casualty Program Cost Comparison; 2. CLIC 2020-2021 Workers’ Compensation Program Cost Comparison; 3. Individual Member Workers’ Compensation Loss Ratio as of December 31, 2019; 4. District 200’s 14-year Summary Loss Report including Closed, Open and Total claims; and 5. Fiduciary Liability Premiums/Fees Comparison

RECOMMENDATION: For the Board of Education to approve the CLIC insurance renewal for a total of $572,739 for the 2020-2021 school year as presented.

Strategic Plan: Priority 4 Board Goal: District Policy: 4:10, 4:100

TEL: (708) 383-0700 WEB: www.oprfhs.org TTY/TDD: (708) 524-5500 FAX: (708) 434-3910 COLLECTIVE LIABILITY INSURANCE COOPERATIVE 2020-2021 PROPERTY/CASUALTY PROGRAM COST COMPARISON District: Oak Park-River Forest High School District #200 2019-2020 2020-2021 Fixed Costs Expiring Proposed Package (includes General Liability, Auto Liability, Garage Liability, Police $6,376 $6,995 Professional/Security Guards, Bullying and ) Property (including Auto Physical Damage) $650,000,000 Limit $42,109 $54,104 Boiler & Machinery $4,870 $5,325 School Board - $35,000 Deductible $5,935 $9,408 Excess Liability $35M xs $1M Limit $10,518 $11,486 Student Accident – Mandatory $22,740 $23,095 Student Accident – Catastrophic $3,394 $3,447 Pollution Liability $3,359 $3,519 Cyber Liability/Identity Theft - $3,000,000 Limit $2,315 $7,945 Crisis Protect $1,755 $1,755 Arthur J. Gallagher Risk Management Services Fee $14,233 $14,532 Gallagher Bassett Services Claims Administration Fee $3,033 $3,042 Gallagher Bassett Services Loss Control Fee $995 $995 CLIC Program Management Operating Fee (1) N/A N/A Total Fixed Costs $121,632 $143,722 % of Change 18.16%

201 -20 20 -202 Variable Costs 9 20 20 1 Expiring Proposed Loss Fund – Package (includes actuarial debit/credit)(2) $53,584 $46,680 Actuarial Debit/Credit – Package 8.7% -17.5% Loss Fund – School Board Legal Liability (includes actuarial debit/credit)(2) $15,202 $15,310

Actuarial Debit/Credit – School Board Legal Liability 20.0% 20.0%

Total Program Contribution on a $190,418 $20 Maximum Cost Basis 7,638 % of Change 9.04%

Total Program Costs Due for July 1, 2020-2021 $207,638

Statistical Information 2019-2020 Expiring 2020-2021 Proposed % Change

Total Insurable Values (Includes Vehicles) $288,809,964 $294,043,074 1.81% Students 3,394 3,447 1.56% Vehicles 19 19 0.00%

(1) The CLIC Property/Casualty Program Management Operating Fee is allocated to each member by the CLIC treasurer. This fee is solely used to pay for those expenses such as the Treasurer Services, Legal Services, Publication of Safe Schools Newsletter, Appraisal Cost, Audit Expenses, D&O Insurance, Actuarial Expenses and Meeting Expenses that are needed to operate the pools operations. In the past, the cooperative has utilized loss fund interest earnings to pay for those expenses. Due to the lack of interest income to cover the expenses, a slight fee must be allocated to each member. The CLIC Executive Committee concurred that beginning with the 2014/2015 renewal a Program Management Operating Fee will be instituted only on the Property/Casualty Program. The fee will be based upon the minimum fee of $552 per district with a rate per student charge. The maximum amount a member district could pay is $5,980. For Fiscal Year 2020-2021, the CLIC Executive Committee has elected to continue the suspension of this charge per the treasurer’s recommendation due to sufficient interest earnings to cover these costs. (2) Actuarial Debit/Credit is provided by independent audit firm Milliman, Inc. based on each district’s loss experience for the past 5 years, not including the current year.

COLLECTIVE LIABILITY INSURANCE COOPERATIVE 2020‐2021 WORKERS’ COMPENSATION PROGRAM COST COMPARISON

District: OAK PARK‐RIVER FOREST SCHOOL DISTRICT #200

Payroll Information 2019‐2020 Expiring 2020‐2021 Proposed % Change 7380 – Drivers $0 $0 8868 – Teachers/Professionals $42,358,473 $43,972,287 9082 – Cafeteria $881,074 $859,034 9101 – Maintenance/All Other $3,500,293 $3,474,333 Total Estimated Payroll $46,739,840 $48,305,654 3.35% Experience Modification Factor 1.05 1.01 ‐3.81% Modified Premium $267,124 $250,772 ‐6.12%

Fixed Costs 2019‐2020 Expiring 2020‐2021 Proposed % Change Workers’ Compensation Premium $13,623 $13,331 AJG Co. Administration Fee $12,173 $12,428 Sedgwick Claims Administration Fee $9,362 $9,428 Sedgwick Loss Control Fee $965 $950 Total Fixed Costs $36,123 $36,137 0.04%

Variable Costs/Loss Fund 2019‐2020 Expiring 2020‐2021 Proposed % Change Loss Fund – Initial 100% $304,521 $287,986 Actuarial Debit/Credit 6.7% 13.5% Loss Fund – 100% with Actuarial Debit/Credit $324,908 $326,914 High/Low Plan 10% Supplemental Loss Fund $0 $0 Contribution, if applicable Total Loss Fund w/Debit/Credit and $324,908 $326,914 0.62% High/Low

TOTAL WORKERS COMPENSATION PROGRAM COSTS $361,031 Expiring vs Proposed Renewal $363,051 0.56%

TOTAL WORKERS COMPENSATION PROGRAM COSTS Total Due for July 1, 2020‐2021 $363,051

Collective Liability Insurance Cooperative

Individual Member Workers Compensation Loss Ratio As of December 31, 2019

Member: Oak Park-River Forest School District #200

Total Paid & Reserved CLIC Loss Fund Policy Term Losses within CLIC’s Loss Ratio Collected Retention

2014/15 $359,676 $430,238 83.6%

2015/16 $291,140 $329,478 88.4%

2016/17 $69,202 $408,780 16.9%

2017/18 $227,895 $332,307 68.6%

2018/19 $107,825 $324,228 33.3%

Total $1,055,737 $1,825,031 57.8%

Please note the above figures do not contain any trending or development factors that are known to increase open claims.

Five years loss data, valued as of 12/31/19, was utilized in the calculation of the 2020/2021 Debit/Credit Allocations. 010003 COLLECTIVE LIABILITY INSURANCE RSQ72R01 COOPERATIVE RISX-FACS SUMMARY LOSS REPORT 17-Jan-2020 19:18 AS OF 31Dec2019 PAGE 140 PYRAMID LEVEL : SCHOOL DISTRICT PYRAMID UNIT : 200O OAK PARK-RIVER FOREST SD #200 LOSS PROGRAM : 02 AJG CO. PROGRAM REPORT DESCR : ONE PAGE SUMMARY OF LOSS INFORMATION BY CLAIM PERIOD. CLM BEGIN ENDING CLOSED OPEN TOTAL NET REMAINING TOTAL LESS: SPEC. AGGREGATE PER DATE DATE CLAIMS CLAIMS CLAIMS PAYMENTS RESERVE EXPERIENCE EXCESS LOSS LOSSES ------16 01Jul19 01Jul20 4 1 5 3333 5700 9033 0 9033 15 01Jul18 01Jul19 7 1 8 15154 2554 17708 0 17708 14 01Jul17 01Jul18 1 0 1 224 0 224 0 224 13 01Jul16 01Jul17 5 0 5 1015 0 1015 0 1015 12 01Jul15 01Jul16 11 0 11 10354 0 10354 0 10354 11 01Jul14 01Jul15 5 0 5 10786 0 10786 0 10786 10 01Jul13 01Jul14 6 1 7 87174 36427 123601 0 123601 09 01Jul12 01Jul13 3 0 3 2787 0 2787 0 2787 08 01Jul11 01Jul12 1 0 1 0 0 0 0 0 07 01Jul10 01Jul11 4 0 4 11748 0 11748 0 11748 06 01Jul09 01Jul10 2 0 2 54442 0 54442 0 54442 05 01Jul08 01Jul09 4 0 4 3437 0 3437 0 3437 04 01Jul07 01Jul08 9 0 9 59905 0 59905 0 59905 03 01Jul06 01Jul07 7 0 7 130422 0 130422 0 130422 02 01Jul05 01Jul06 7 0 7 7753 0 7753 0 7753 01 01Jul04 01Jul05 3 0 3 790147 0 790147 170147 620000 ======T O T A L S 79 3 82 1188681 44681 1233362 170147 1063215

COLLECTIVE LIABILITY INSURANCE COOPERATIVE 2020‐2021 FIDUCIARY LIABILITY COST COMPARISON

District: Oak Park‐River Forest High School District #200

LINE OF COVERAGE COMPANY 2019‐2020 EXPIRING 2020‐2021 RENEWAL % Change PREMIUM PREMIUM Fiduciary Liability Federal Insurance $2,050 $2,050 0% Company (Chubb) Each Member Each Member

TOTAL FIDUCIARY LIABILITY PROGRAM COSTS DUE for July 1, 2020‐2021 $2,050