HomeMy WebLinkAboutProject Connect Insurance
Date: June 2, 2010
To: Board of County Commissioners
From: Erik Kropp, Deputy County Administrator/Risk Manager
Re: Project Connect Insurance – June 7th Work Session
At your June 7th work session we will be discussing a request for the County to assume liability related to
Project Connect. Project Connect is a community outreach program that reduces barriers for those who
are homeless or at risk of homelessness. At this one day event, real time services are offered to assist
guests in various aspects of their life such as healthcare, legal aid, housing assistance, job opportunities,
benefits enrollment, children’s services, mental health services, and more. Staff from the Partnership to
End Poverty has served as the lead agency for Project Connect.
Project Connect has been held at the Deschutes County Fair and Expo Center and this year’s event is
scheduled at this location on September 18, 2010. Consistent with all events held at the Fair and Expo
Center, the County requires Project Connect to have general liability insurance and to name the County as
an additional insured.
In previous years, to meet this requirement the Partnership to End Poverty has purchased general liability
coverage through a special event policy. For this year’s Project Connect, the Partnership to End Poverty
has been unable to obtain an insurance policy and is asking the County to assume the liability for the
September 2010 event.
Listed below are three options and a short discussion of each:
1. County declines accepting liability for Project Connect: this option protects the County from
liability and ensures that the self-insurance fund remains for its intended purpose: protect County
departments and to pay out claims on behalf of County departments.
2. County and other organizations jointly provide the liability coverage for Project Connect:
representatives from several other organizations have contacted the County in support of the
County providing insurance coverage for Project Connect. These representatives have encouraged
the County to provide insurance because of the importance of the event and low probability of a
claim. Staff can approach these organizations and ask if they will join the County in providing
insurance to Project Connect. If these organizations agree, this option would result in
additionally organizations accepting liability and a sharing in the costs of a potential claim.
3. County covers Project Connect through its self-insurance program for one year: since the County
is self-insured for general liability, the County would pay out claims related to Project Connect
from its Risk Management reserves. These reserves are used for both general liability and
worker’s compensation claims. A large claim would lower the reserve below the recommended
level as recommended by an actuarial study. To restore the reserves, County departments would
be charged higher rates for insurance. A large claim could fall outside the Oregon Tort Claims
Act limit if a jury determined that this capped amount did not provide a just remedy. The current
cap is $1 million (general aggregate) and will change to $1,066,700 (general aggregate) on July 1,
2010. Also, this option could result in other non-profit agencies asking the County to provide
insurance for events.
Staff recommends option one. Should the County accept liability for Project Connect and end up paying a
claim, County departments would end up paying higher rates for insurance to restore the insurance fund
to cover other claims. Higher insurance rates for departments would result in less funds for direct service.
Additionally, a large claim could completely deplete the Risk Management reserve fund.
If the Board elects option three, it would be imperative to take prudent steps to help mitigate the risks.
This includes possibly purchasing an event policy on behalf of the County (staff is waiting for a price
quote and listing of inclusions and exclusions); requiring organizations participating in Project Connect to
provide a certificate of insurance and name the County as additionally insured; requiring all volunteers to
be associated with an agency and covered by that agency’s insurance; and requiring that the medical and
dental providers be covered by their own medical malpractice policy or some other non-County means.
c: Dave Kanner, County Administrator