Insured Programs

It is time once again to prepare for the July 1, 2021 Property Program and Pollution Program renewals. Details are provided in the box to the right of the upcoming workshops to assist you in reviewing and updating your agency’s property schedule, COPE data, and vacant building listings.

Please read the following information thoroughly, as it includes detailed information on various aspects of the renewal process. The first step in the process is to update your agency’s property schedule. The deadline to complete this is January 28, 2021. Data in your agency’s property schedule as of this deadline will be used by the Authority in its negotiations with carriers for the July 1, 2021 renewal.

If your agency does not currently participate in the Property Program but may want to for 2021-22, please contact Jim Thyden, Insurance Programs Manager with the California JPIA at (562) 631-5449 or jthyden@cjpia.org.

Updating the schedule of values this year will be different than in past years because all members in the Property Program have had appraisals completed by our business partner, CBIZ. The appraisal data has been imported into the AlliantConnect database where members can review both property schedules and vehicles schedules. If you need an AlliantConnect profile or would like to schedule an individual/group training session on how to use the database, please contact Joe Sanders, Senior Business Analyst with Alliant Insurance at (949) 660-8153 or jsanders@alliant.com.

Workshops
You are invited to attend either of two online workshops to learn about the Property Program and the renewal, appraisals, pollution program, and vacant buildings. The first will take place on January 12, 2021 from 9:00 a.m. to 10:30 a.m. The second will take place on January 13, 2021 from 2:00 p.m. to 3:30 p.m. Further information about participation in the workshops is provided in the box to the right. If you are unable to attend either of these, and would like to review this information, please contact Jim Thyden, Insurance Programs Manager with the California JPIA at (562) 631-5449 or jthyden@cjpia.org.

Data and Document Review
Please review your agency’s:

• Property Schedule on AlliantConnect
• Vehicle Schedule on AlliantConnect

Because Property Program annual contributions are dependent upon the value and type of property to be covered, as well as loss history, it is essential that every location and every vehicle for which your agency desires coverage is scheduled. With the data from the recent appraisals now in AlliantConnect, all the information contained in the data fields for each location on your property schedule should be reviewed this year for accuracy and completeness. Please note that for any fields left blank, assumptions will need to be made about the data, which can result in an increased rate charge for the applicable location.

The data fields are:

• Complete Address
• Construction Type (frame, block, masonry, reinforced masonry, etc.)
• Occupancy Type
• Protection Systems (fire and/or alarms, fencing, security services, etc.)
• Year Built
• Year Remodeled (if applicable)
• Square Footage
• Number of stories excluding basement
• Sprinklers (yes/no) or percentage of building sprinklered if not 100%. If sprinklers do not apply to a location, please select “N/A” in the percentage field.
• Earthquake/Flood coverage desired for location (yes/no)
• Valuations (on a Replacement Cost Basis) – Building, Contents, Tax Interruption, and Business (Revenue) Interruption
• For Vehicles: Year, Make, Model, Complete VIN# and Value

Pricing and COPE Data

Over the years, the Authority has implemented changes to the Program to make the rating process and allocation of program costs equitable among members. Rating is based upon each member’s exposures and loss history. As such, members should provide the most accurate data possible for each location, as a lack of critical information defaults to the least favorable treatment in the rating process. This data is called COPE data and is important because it is the fundamental data that is used to price and allocate annual contribution in the program. COPE stands for:

• Construction – what it is made of?
• Occupancy – what it is used for?
• Protection – how is it protected (fire alarms, etc.)?
• Exposure – proximity to natural or other hazards. Proximity to fire station.

As the property insurance market has hardened and losses have trending upward, the quality of the COPE data submitted to underwriters has become increasingly important. From an underwriting perspective, the goal is to properly assess a location’s risk and determine the level of exposure associated with that location. A key element to this risk assessment is evaluating “relative rating factors,” which is a method of applying credits or debits to each location based on the COPE information provided relative to all other locations in a particular portfolio. While every location can have a different impact on overall risk based on its construction, the lack of COPE data results in an assumption by underwriter models of the “worst-case” rating factor. What this means for your agency is that a maximum amount of debit will be applied to each location lacking sufficient COPE information.

It is also important to note, that the construction type of a building can have a drastically different impact based on the type of coverage that is being underwritten. For example, while a wood frame building may have a higher rating factor for “All-Risk” (e.g. fire) perils, the very same building would have a more favorable rating factor for earthquake coverage. This is because wood bends and sways during an earthquake but burns faster than concrete in a fire.

A lack of COPE data may result in a significantly adverse result to that location from a rating perspective. When this is compounded over multiple locations, the result can be a higher rating and cost for an individual member of the program.

Understanding COPE and what it means to the underwriting process will help your agency properly cover locations and gain a better level of control over your annual contribution by reducing any significant fluctuations from year to year.

Vacant or Unoccupied Buildings
There are significant differences in coverage available for buildings that are vacant or unoccupied versus those that are not.

For the purposes of coverage, a building is considered vacant or unoccupied when it does not contain adequate property to conduct customary operations. However, any time period when customary operations are suspended due to circumstances that are usual to such operations does not in and of itself render a building to be vacant or unoccupied.

The Memorandum of Coverage – Property Program differentiates coverage as follows:

• Unscheduled vacant buildings are excluded from coverage.
• Scheduled vacant buildings have a sublimit of $2,500,000.
• Scheduled vacant buildings have a deductible of $500,000.
• For claims to premises that are vacant for more than 60 days and reported to the Authority, actual cash value, not replacement cost, will apply.
• For claims to premises that are vacant for more than 60 days and not reported to the Authority, the maximum recovery by the member will be actual cash value, less 25%.

Please review all of your agency’s locations to ensure that any vacant buildings are properly noted and that any locations that are not vacant are listed on the property schedule with the correct occupancy. If you would like assistance determining whether a building is vacant or unoccupied, please contact Christopher Gray, Account Manager with Alliant Insurance at (949) 660-5944 or cgray@alliant.com, or Jim Thyden, Insurance Programs Manager with the California JPIA at (562) 631-5449 or jthyden@cjpia.org.

Infrastructure
Coverage for infrastructure is often different from coverage for other locations. While some infrastructure is not able to be covered by any property coverage, it is crucial for members to consider whether to schedule infrastructure that can be covered by this Property Program.

Pollution Program
If your agency participates in the Authority’s Pollution Program, property schedules are also used as the primary document to capture information needed for this program. By updating your agency’s schedule, two necessary administrative tasks are completed at once. If your agency does not participate in this program and you would like information about this coverage, please contact Jim Thyden, Insurance Programs Manager with the California JPIA at (562) 631-5449 or jthyden@cjpia.org.

Other Optional Coverages
The Property Program also offers Earthquake and dedicated Flood coverage, Mechanical Breakdown, and physical damage for vehicles. These coverages are available for specific property members to report on their property schedules in the AlliantConnect database. If you have questions about these coverages, please contact Jim Thyden, Insurance Programs Manager with the California JPIA at (562) 631-5449 or jthyden@cjpia.org.

If you have any questions or need assistance, please contact Christopher Gray, Account Manager with Alliant Insurance at (949) 660-5944 or cgray@alliant.com, or Jim Thyden, Insurance Programs Manager with the California JPIA at (562) 631-5449 or jthyden@cjpia.org.

The California JPIA’s insured programs represent commercial insurance programs, including all risk property, earthquake, mechanical breakdown, vehicle physical damage, pollution and remediation legal liability, crime, special events, and vendors/contractors. The California JPIA uses a third-party administrator to investigate and respond to all claims.

Property

The property program includes all-risk coverage for real and personal property, including buildings, office furniture and equipment, fine art, contractor’s equipment, mobile and unlicensed equipment, vehicles, the property of others while in the member’s care, and buildings under construction.

Optional coverage is available for earthquake and flood, high-value emergency vehicles, and mechanical breakdown. Please see the documents section below for additional information on each of the property program elements.

Rates are competitively priced based upon member exposures and experience.

Property Schedules

All participants in the property program are asked to keep their schedules current and to maintain their accuracy. Since property schedules determine member premiums for property coverage, updates should include adding or deleting buildings, equipment, and vehicles acquired/sold since the schedule was last updated. Additionally, a review of the current values listed for both your property and vehicle schedules should take place. It is further recommended that buildings be appraised every seven to ten years by a professional appraiser to ensure they are properly valued.

Members may access their property schedules on Alliant Insurance Services’ online AlliantConnect system by clicking here. Please contact Joe Sanders for any assistance with AlliantConnect, including passwords or technical difficulties. Joe may be reached at (949) 660-8153 or jsanders@alliant.com.

Mechanical Breakdown

Those members who participate in the mechanical breakdown program are offered inspections of certain pressurized vessels. These inspections are mandated by the State of California. Travelers Insurance, the Authority’s mechanical breakdown insurance carrier, will conduct these inspections at no cost to the member and will help identify ways to prevent losses to valuable equipment. Members are contacted directly by Travelers prior to the expiration of a vessel’s certificate.

Coverage is for both first- and third-party damages, including certain types of cleanups, non-owned disposal sites, and above-ground and underground storage tanks. Members work directly with the insurance carrier to investigate and respond to claims.

If you believe a claim should be reported immediately, use the link on this page, even if you do not have all the information listed above.

Hazardous Materials Incident

• In the event of a fuel spill or hazmat incident, approach the scene cautiously, and avoid rushing in or taking action beyond your level of training or expertise
• Identify the hazard by consulting placards, labels, MSDS or other available sources of information
• Secure the area to prevent unauthorized access
• Contact local emergency response organizations

Underground Storage Tanks

Participating members have the option to obtain coverage to meet California’s Financial Assurance for Underground Storage Tanks. See the Pollution Program documents for additional information and details.

The cyber liability program provides coverage for both first- and third-party claims. Members work directly with the insurer to investigate and respond to incidents.

If an Incident or Breach Occurs

If a member becomes aware of an incident or breach, immediately call the Crisis Hotline at (800) 817-2665.

• Person most knowledgeable about the claim/incident with phone, alternate phone, and email
• Best time to reach contact
• Does the claim/incident involve services provided to anyone outside California?

Does the incident involve any of the following:

• Lost or stolen laptop or wireless device (BlackBerry, iPhone, smartphone)
• Other lost or stolen data storage device (thumb drive, portable hard drive, memory card)
• Use of / access to confidential information by someone who works for you
• Use of / access to confidential information by someone who does not work for you

For assistance with this program, contact the Authority’s Insurance Programs Manager, Jim Thyden, by email or at (562) 467-8784.

The California JPIA contracts with Alliant Insurance Services for administering this program. Coverage is provided for the following exposures.

• Faithful Performance
  Employee dishonesty, including theft, and failure of any employee to faithfully perform their duties. Includes all employees, the agency treasurer, agency
  clerk and/or tax collector and any employee required by law to be individually bonded.
• Depositor’s Forgery
  Loss by forgery or alteration of, on or in any check, draft, promissory note or similar written promise, order or direction to pay money that is made or
  drawn upon the member’s accounts, including credit, debit, or charge cards, by someone acting as the member’s agent or that are purported to have been so
  made or drawn. This coverage protects you against forgery or alteration losses caused by a person other than an employee.
• Crime – money and securities
  Covers loss of your money or securities by theft, disappearance or destruction while they are on your premises or on banking premises, or while your money or securities are outside your premises in the possession of a messenger. This coverage protects you from theft, robbery and safe burglary caused by persons other than an employee.
• Computer Fraud
  Theft directly related to the use of any computer to fraudulently cause a transfer of money, securities or other property from inside the premises or banking premises to a person or place outside those premises.

Coverage provides liability insurance when member-owned premises are used for special events or short-term activities. Examples include weddings, art festivals, parades, block parties, yoga classes, and member-sponsored events such as job fairs, carnivals, and swap meets. Members administer the program, accept funds, and issue certificates of insurance online with Alliant Insurance Services, with whom the California JPIA contracts for this program. There is no deductible, and the member is added as an additional insured, if entered on the certificate. Because it is automatic, members do not need to obtain an additional insured endorsement. Liability limits are purchased in $1,000,000 per occurrence increments. Medical payments are also available with limits of $5,000, with the option to purchase $5,000 in additional limits.

To use the program, access the Alliant website here. Instructions on how to use Alliant’s Special Events online system can be found here. Any necessary documents, including the program manual, can be found using the links on the right side of this webpage.

This program was developed to meet the needs of the public entity in assuring that there is insurance coverage in place for those situations where members enter into a contract with a contractor or vendor. By offering this coverage, the member will have the advantage of being able to contract with qualified bidders. Previously, these contractors could not participate as they often could not meet the member’s minimum insurance requirements. Coverage is provided for general liability only.

The Railroad Quiet Zone liability program provides coverage for bodily injury and property damage claims arising out of the acts or omissions of the insured at the Designated Quiet Zone noted in the declarations or by endorsement. Provides indemnification to the railroad when required by written contract. There is also limited pollution coverage when caused by a railroad accident. There is a $100,000 self-insured retention per occurrence and a $2,000,000 limit per occurrence with a $2,000,000 program aggregate for all claims by all members.

In 2005, the Federal Railroad Administration (FRA) adopted the “Train Horn” rule which required that locomotive horns be sounded at public highway-rail crossings and provided flexibility to localities to silence horns through the establishment of “Quiet Zones.” The rule went into effect on June 24, 2005, at which time existing state and local whistle ban laws were preempted. Subsequently, several Authority members began the process of establishing “Quiet Zones.”

Under the MOCs for the primary and excess liability programs, the Authority does not provide coverage for railroad exposures, including “Quiet Zones” as approved by the FRA, or any liability members assume in contracts related to “Quiet Zones.” The MOCs do permit Authority staff to approve “Protected Contracts” with indemnity agreements pertaining to “Quiet Zones.” If the “Protected Contract” is approved, coverage is bound with the insurance carrier. Premiums are paid by the Authority and reimbursed by members.

Because the insurance carrier will not name operating railroads as Additional Insureds, members retain this exposure if they have agreed to it in a written agreement or contract. This results in a coverage gap for members, who will retain the full exposure for their contractual indemnification of an operating railroad.

The California JPIA contracts with Arthur J. Gallagher & Co. to administer this program. Members can contact Jim Thyden by email or (562) 467-8784 with any questions or to purchase this optional coverage.