By Katrina Fuller

kfuller@post-journal.com

LAKEWOOD — The Lakewood Village Board may soon be bringing its village insurance out for bid each year, after members of the board discussed the matter during a recent meeting.

A resolution to accept a quote for the village of Lakewood property and casualty insurance program was brought before the board, drawing comments from village officials.

Board member Douglas Schutte brought up that the insurance currently carried by the village has been through the same provider for the past 16 years. He asked when the current insurance was compared to an offering from another company, which was six years ago. Insurance for the village is renewed every five years, and Schutte questioned why the village wasn’t looking for other bids for insurance.

Village Clerk Mary Currie said the bidding process began because Randy Graham, an insurance agent, wanted to bid on the insurance program for the village. She said the village only received a bid from the current insurance company.

“What I want to get at is why this all happened,” Schutte said. “I mean, really we should be putting this out to bid every year. That’s the first thing.”

Schutte said Graham does a lot of work with municipalities and had initiated the bidding process.

“The reason why you don’t have a quote from Randy Graham is because the companies that he indicated he wanted to quote and got the paperwork signed for, there was another agent who probably wouldn’t have quoted this at all … once he found out, apparently, that Randy wanted to quote this, he put in his request to go to these carriers and get quotes,” Schutte said. “Ultimately, these companies that were going to give the quotes had to pick between Randy Graham and the incumbent agent of Great Lakes. Apparently, and I don’t know how this happened, but the one who should have gotten the ability to quote those additional companies was Randy Graham because he was the one who did it first. But, apparently, the other agent was given priority over Randy, despite the fact that Randy was the first one.”

After the other agent put in quotes, Schutte said Trident “miraculously” lowered its cost and beat the other bids.

“Randy Graham, who prompted the bidding process and also, I ultimately would say is responsible for the great price reduction that Trident came up with, is kind of sitting out there and didn’t get an opportunity,” he said. “I don’t think that’s good business.”

Currie said Graham told her he would be bidding different companies than Great Lakes and Great Lakes was offering quotes from one insurance company that had been bid under two different names. As it stands, Currie said Graham signed one of the companies he was bidding over to Great Lakes and never submitted anything else.

“I guess what I would suggest going forward because, as I’m sure this coverage is not cheap, is that this is as serious as picking out health insurance for our employees,” Schutte said. “A little bit more transparency within our board would be a good idea because the way insurance bidding works in the property casualty world is a little different and quicky. I think property insurance companies are notorious for not being competitive as long as they know they can be. This is something we should take pretty seriously and bid out every year.

Holcomb asked if other municipalities bid on their property and casualty insurance every year. Schutte pointed out that health insurance is put out for bid every year.

“If we had a serious claim, they wouldn’t hesitate to raise our rates the next year,” he said.

Board member Ellen Barnes said it might be best to call other municipalities and see what they do when it comes to renewing their insurance.

“We have a procurement policy,” Schutte said. “Let’s follow it.”

Board member Edward McCague said the board would be “harming the village” if they do not bid the insurance program out every year.

“We’re not competitively bidding this insurance,” he said. “If we’re staying with the same carrier year after year after year, and they’re not feeling any competition, and all of the sudden, this year they sense some competition, the price falls. We know darn well we should have been doing a much better job with the procurement of our insurance. I don’t know of any reason that we have to do what other communities do in this particular regard”

“I was thinking about the fact that they’re familiar with us,” Barnes said. “Not that they should get the bid, but if they’ve got us covered with all the things that we do — our Christmas in the Village and the Fourth of July, the other companies are going to have to be really specific with that being another rider onto the insurance policy. So, that would be another $5,000 on top of the $70,000 that it has been.”

McCague agreed that policies do have their own specific characteristics, but said the board should weigh those characteristics against other bids that are received each year.

“It’s really not that hard to do either,” said Schutte. “You have to fill out the same paperwork every year anyway. You just duplicated it and give it to the other carriers, and then they make their judgment.”

The board decided to approve the resolution accepting the bid they did receive but wanted to make it a point to include the topic in their next board meeting as well.