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In consideration of the Agreements specified on the reverse side of this document, The Wyatt Company's Risk Management Consulting Services
<br />shall include, but at the sole discretion of The Wyatt Company, may not be limited to:
<br />(NOTE: Services to be rendered include only those that are specifically indicated in Paragraph I on the reverse side of this Agreement.)
<br />INSURANCE AND RISK MANAGEMENT AUDIT
<br />The Wyatt Company, in conducting the assignment, will perform the following:
<br />1. Identification of the exposures to fortuitous types of loss, excluding normal business risks.
<br />This process will encompass Identification of loss exposures based on an on -site inspections and interviews by Wyatt consultants and
<br />review of available financial reports and other specified material and information.
<br />The Wyatt Company recognizes the individuality of each of its clients and, therefore, attempts to isolate and define exposure areas that may be
<br />unique to a given entity.
<br />2. Examination of the possibility of eliminating loss exposures, or significant reduction of such exposures, and the practicality of such elimination or
<br />reduction. This element will not encompass detailed inspections or cost /benefit analysis, but will approach problems on the basis of a general
<br />overview.
<br />The overview will seek to identify areas with the potential for practical application of programs designed to eliminate or mitigate frequency or
<br />severity of loss.
<br />3. Review of the risk management philosophy and development of recommendations relative to that philosophy.
<br />This element will involve a review of existing policy manuals, statements, and procedures. The ultimate aim will be to define the present risk man-
<br />agement philosophy and what changes, if any, should be effected to this philosophy.
<br />4. Determination of the most appropriate and least costly method of handling each exposure —i.e., commercial insurance, self- insurance, hold
<br />harmless agreements, a captive insurance company, etc.
<br />This will involve the examination of the entity's current risk financing practices and comparison of these practices with other alternatives which
<br />appear to be advantageous and cost effective and which also appear to be consistent with the entity's insurance management philosophy. This
<br />examination will take into account such things as the size of the entity, its premium base by line of insurance, its self - retention capability, its pre-
<br />vious loss history, etc. Actuarial techniques of projecting future loss expectancy may be utilized in our analysis of the alternatives, for any deter-
<br />mination of the most effective means of dealing with exposure to future losses must involve a realistic evaluation of the probable magnitude of
<br />such losses.
<br />5. Analysis of the existing contracts of insurance and evaluation of:
<br />a. The adequacy and comprehensiveness of protection afforded by them.
<br />b. The competitiveness and adequacy of premiums and rates.
<br />c. The services provided by present carriers.
<br />d. The financial stability of the insurance carriers involved, to the extent currently published information permits such an evaluation.
<br />This phase of our study will consist of making a complete and detailed audit of your current commercial insurance program and its coverages,
<br />including discussion of the design and scope of insurance coverages which are currently ip force, or which may be recommended by The
<br />Wyatt Company in order to address any gaps in your program.
<br />6. Determination of the advisability of any modification of the present insurance program, including such matters as:
<br />a. Changes to or from self- insurance
<br />b. Purchase of additional insurance
<br />c. Changes in deductible levels
<br />d. Changes in rating plans
<br />e. Elimination of unnecessary coverages
<br />f. Consolidation of coverages
<br />g. Amendment of policy terms and conditions
<br />h. Reconsideration of systems of valuation
<br />i. Changes in practices regarding insurance requirements from lessees, suppliers, or contractors
<br />This step involves final review of all information assembled and ahalyzed in the preceding five phases of analysis. It has as its primary object iv:._
<br />the coordination of a cost effective risk management program, utilizing self- retention capability, contractual transfer of risk, broad
<br />commercial insurance protection, and effective application of risk management and insurance services.
<br />7. Provide a detailed, written report containing our conclusions and recommendations and appropriate discussions of topics.
<br />MARKET ASSISTANCE
<br />NOTE: The Wyatt Company reserves the right to require The Insurance and Risk Management Audit as described as a prerequisite.
<br />A. The drafting of specifications, detailing the scope of and the breadth of insurance coverage required by an entity.
<br />B. Selecting appropriate brokers and agents.
<br />C. Assistance in accumulating necessary Underwriting data and presenting the specifications and data to brokers.
<br />D. The allocation of insurance markets to avoid the duplication of market contact and the resulting conflicts and problems this creates.
<br />E. Answering inquiries and requests arising from the specifications and underwriting data.
<br />F. An evaluation and recommendation on proposals obtained.
<br />G. An evaluation of the issued policies to insure that they comply with the specifications.
<br />DUALITY OF INTEREST STATEMENTS
<br />The Wyatt Company
<br />There are occasions in which work has been performed, or is now being performed, by The Wyatt Company for clients whose services or
<br />products may be evaluated or recommended in the course of an assignment. We are confident that our adherence to strict standards of professional
<br />conduct will prevent those evaluations or recommendations from being affected by any past or present relationships with others. However, we also
<br />recognize that clients are entitled to know of any situations like this before awarding an assignment to The Wyatt Company.
<br />If you have any question as to our relationship with any organization, we will be happy to discuss that relationship with you, and to step aside if
<br />you feel it would in any way impair our objectivity as your consultant.
<br />International City Management Association
<br />ICMA currently sponsors: Group Life Insurance, Disability Insurance, Accidental Death and Dismemberment Insurance, Public Officials
<br />Liability Insurance, Law Enforcement Liability Insurance, and School Board Liability Insurance by endorsement of programs it believes meets the
<br />needs of its members. However, the Association provides as endorsement only for the purpose of assuring the quality of the product and has no
<br />requirement for its purchase.
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