Change in insurance coverage will save township money



DAVISON TWP. — The board of trustees adopted a new property liability insurance carrier Monday night that will save the township $25,000 a year.

The board voted 3-1 in favor of switching the township’s property liability insurance to the Michigan Municipal League Liability Pool, Trustee Lori Tallman being the sole dissenting vote.

Supervisor Jim Slezak said the coverage is the same, like comparing “apples to apples” and he explained that last year Davison Township paid $137,000 with the company it’s currently with.

After informing that insurance carrier the township would be seeking bids, it came back with a $118,000 proposal for the same coverage.

But, when the MML Liability Pool came back with its bid, the amount for what Slezak said is essentially the same coverage had a price tag of $93,000 annually.

“Then when the Michigan Municipal League came in and showed us this number – with a side by side comparison – to go from $118,000 down to $93,000 saves us quite a bit of money for basically the same coverage,” said Slezak. “I would have thought, and maybe this is my wrong thinking, but everyone in this building should have known this was coming. Because I’m sure it comes every year. So, in previous years, this would have been looked at every year.”

Brian Steckroth, account executive with the Michigan Municipal League Liability Pool, said the MML is offering $5 million of minimum liability per occurrence, with no maximum that it will pay out in one year. This also comes with a zero deductible.

He said the coverage holds true with all lines of liability – personal injury, public official coverage including wrongful termination, discrimination lawsuits and similar instances.

Law enforcement liability is also at $5 million per occurrence, with a zero deductible and all legal defense for law enforcement cases would be handled by the law firm of Plunkett & Clooney.

Treasurer Tim Green said everything in the current policy was matched by the MML. The township has a total of $8,527,675 in overall coverage for the current policy at $118,000 (the 2021-22 bid by the current company). Under the MML, the township will receive $11,225,689 at $93,000 a year.

The proposed shift to a new insurance carrier was put on hold at the board’s June 21 meeting after concerns were raised by Tallman and Police Chief Rick Freeman.

Tallman said she wanted more time June 21 to digest the changes in coverage, while Freeman was opposed to the switch because the board had not consulted department heads to see what their thoughts were on the new coverage.

“I’m concerned with this move, specifically in the (police) department because today is the first I’m hearing of this change,” said Freeman, just nine days before his retirement. “This product may turn out to be better than what we have now, but my concern is that in running a police department I have not had time to digest this information to give you an honest opinion as to whether we should switch.”

He added, “The welfare and liability of my employees is at hand and I have some serious concerns with this.”

Slezak defended the move, saying the administration had not made it a mystery there would be cost-cutting changes coming following the election of a new board in the November election.

“So, whether you knew it was coming, maybe we didn’t, I don’t know,” said Slezak. “I got put in this place to do a job and everything is going to be looked at.”

Freeman said he didn’t doubt the numbers being put forth by Steckroth, but said he thinks the township pays its department heads to be experts in their respective areas and should be consulted before making a decision to switch insurances.

“When you pay me to look out for your police department, I just ask that we be included in the conversation,” he said. “That is the crux of my concern today.”

Tallman said she is “intimately familiar” with the MML and Audrey Forbush with Plunkett & Clooney and had no reservation in that regard. She also said he concern was the board had no time to digest the information.

When the board returned to the matter at the June 28 meeting, Tallman said she could see where the new policy would match or be better than the original policy in some areas, but other areas appeared not to offer as much coverage.

“I have concerns there are gaps,” said Tallman. “It’s worth working on still to get those gaps filled in.”

Treasurer Tim Green said he learned, having previously sold insurance, that there is such a thing as being over insured, just as you can be under insured.

“It’s bad either way,” he said.