3.3. SR 02-18-2003River
MEMORANDUM
Item # 3.3.
TO:
Mayor and City Council
FROM:
Lori Johnson, Finance Director
DATE:
February 18, 2003
SUBJECT: Liquor Store Insurance Policy
Safeco Insurance Company has notified the city that Safeco will not renew the city's liquor
liability and liquor store property policy that expires on March 31. Last year during renewal
Safeco stated concerns about the liability portion of the policy thinking Safeco may be
responsible for city claims unrelated to the liquor store. Although, xve do not believe that to
be the case, Safeco has decided not to renew the policy.
As you may recall, in anticipation of this policy being cancelled, ~vhen the city's insurance
renewal with the League of Minnesota Cities Insurance Trust (LMCIT) was discussed last
July, a quote was presented for hquor building and liability coverage. The premium ~vith
Safeco last year was $5,342, and the quote from LMCIT is $11,975 or $6,633 more than
Safeco's premium. Our agent Mary Eberley of First National Insurance Agency and I have
discussed this issue and the options available to the city. Currently, there is only one other
company writing liquor liability and the limits are not high enough to cover all of the city's
exposure. The city has previously had liquor liability coverage with the LMCIT and at this
point it is our only viable option. Also, there are benefits to having all of the city's property
and liability coverage provided by one insurance provider. Therefore, staff recommends that
the liquor liability and property coverage be bound with the LMCIT effective April 1, 2003.
Action Requested
The City Council is asked to authorize liquor liability and property insurance coverage ~vith
the League of Minnesota Cities Insurance Trust effective April 1, 2003.
S:~CO UN CILMJori~liquorliab.doc