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St. Pete Beach okays new insurance carrier

City officials expect to save $30,000 next year in liability premiums as part of a consortium of 43 Florida communities.

Citing poor service and a 1997 attempt by the Florida League of Cities to radically raise rates, the City Commission voted unanimously Monday to abandon its longtime liability insurance carrier.

Beginning in October, the city will be insured by Public Risk Management, a liability consortium of 43 Florida communities, including Gulfport, South Pasadena, Belleair, Kenneth City and Safety Harbor in Pinellas County.

Although the PRM bid ($294,637.24) was barely lower than the League of Cities bid ($297,238), the city expects to save at least $30,000 next year in insurance premiums. The savings will be generated by the more extensive coverage offered by PRM, reducing the need to purchase supplemental coverage for specific risks, and a rate reduction anticipated for October.

"The coverages offered by PRM are equal to or greater than those offered by the League," City Manager Carl Schwing said as he reminded the commission that he sought bids from other insurance carriers largely because of the FLC's 1997 effort to increase liability premiums by more than $60,000. After pressure from Schwing, the FLC backed off that rate increase and agreed to freeze its premiums until the city's insurance package could be rebid.

"There have been some concerns with (FLC) service," particularly in the workers' compensation area, said Schwing, who cited the League's refusal to allow a city commissioner (Jim Myers) to join the FLC board of directors. In contrast, St. Pete Beach would be guaranteed a vote on PRM's board of directors, and could influence decisions on making settlements and their amounts.

One of the largest recent settlements negotiated by the FLC involved a lawsuit filed by Jane Ellsworth, the former city clerk in St. Pete Beach, for alleged sexual harassment by former city manager Danny Walker. Payment of the $110,000 settlement was split by the city and the FLC.

"This loss wasn't held against us (by PRM)," said Kara Schrader-Smith, the city's personnel director. "The policies that we have now lower defense costs. It is a more controlled environment."