Attachment D - Detailed Requirements.pdf

INVITATION FOR BID

EXCESS WORKERS’ COMPENSATION INSURANCE

COMMONWEALTH OF KENTUCKY

KENTUCKY TRANSPORTATION CABINET

THROUGH COMPETITIVE BIDDING PROCESS

IN ACCORDANCE WITH KRS 45A

NAMED INSURED

Commonwealth of Kentucky Kentucky Transportation Cabinet State Risk & Insurance Services Division 500 Mero Street, 1st Floor Frankfort, KY 40601

RESTRICTION ON COMMUNICATIONS

The Commonwealth Buyer listed below shall be the sole point of contact throughout the procurement process. Bidders shall not communicate with any other Commonwealth staff concerning this Solicitation.

For violation of this restriction on communications to the Commonwealth Buyer, the Commonwealth shall reserve the right to reject the bid of the offending bidder.

All communications concerning this procurement shall be in writing via E-mail to the Commonwealth Buyer:

Debbie Mathews, CPPB, KCPM Statewide Procurement Manager Finance and Administration Cabinet Office of Material & Procurement Services 702 Capitol Avenue, Room 096 Frankfort, Kentucky 40601 E-mail: Debbie.Mathews@ky.gov Telephone: 502-564-8649

This provision does not preclude bidders who presently hold contracts with the Commonwealth from communicating with state agencies regarding existing contracts only.

RISK PROFILE AND UNDERWRITING INFORMATION

The Kentucky Transportation Cabinet (KYTC) is a self-insured agency for Workers' Compensation Claims Liability. Risk Management Services Corp. administers the Cabinet's Workers' Compensation Program. The program currently covers all KYTC employees.

Services have been provided by Risk Management Services Corp. out of their regional office in Louisville, Kentucky. Services include establishing claim files, accident investigation, claim payments from an account funded by the KYTC, preparation of claim histories, etc.

Legal services are provided by the KYTC, Office of Legal Services, or by private contract attorneys assigned by the Office of Legal Services. With respect to this mailto:Debbie.Mathews@ky.gov contract, the KYTC and the Specific Excess Insurer shall agree on legal counsel to represent their interests. The attorney(s) will be paid by the KYTC, Office of Legal Services.

Loss Experience from Self Insured Program This information is posted on the Commonwealth of Kentucky's website at http://www.state.ky.us/agencies/adm/mars/otherbids.htm

Employee Payroll and Number of Employees

Year Payroll Employees 2006 $196,702,331.44 4,794

2007 $203,061,321.19 4,971 2008 $201,046,035.14 4,464 2009 $193,558,507.70 4,482 2010 $197,209,031.16 4,837

Aircraft Details

Aircraft Pilot Year - 1966 Graeme Lang (Age 36 ) Make/Model - Piper Aztec Single Engine Time 1,050 No. of Engines - 2 Multi Engine Time 3,300 Annual Flight Hours - 200 Retractable Time - 3,400 No. of Seats - Crew (1) Other (3) Total Time Last 90 days - 20 Hanger - Capital City Airport Louisville Road Frankfort, KY

Claim Reserves (Total Incurred)

5 Year Claims Experience in excess of $100,000

2006 6 Claims 2007 10 Claims 2008 8 Claims

2009 6 Claims 2010 3 Claims

Safety Program

Some of the Responsibilities of the Division of Employee Safety and Health are as follows:

• Developing, updating, evaluating, and administering the KYTC Safety and Health

Programs

Year Grand Total Paid

Grand Total Reserves

Total Incurred

2006 $1,723,527.43 $1,021,770.32 $2,722,060.19 2007 $1,740,014.40 $1,819,502.86 $3,502,650.91 2008 $1,525,671.68 $1,307,139.63 $2,825,143.97 2009 $1,049,898.21 $1,174,344.59 $2,221,445.79 2010 $1,202,981.76 $875,240.93 $2,041,773.69

• Inspecting Transportation's job sites and facilities to ensure they meet federal and state regulations.

• OSHA record keeping for all the crews in the central offices.

The Division also places a great deal of emphasis on training Cabinet employees to ensure a safe working environment. Such topics include, but are not limited to, the following:

AIDS in the workplace

Standard First Aid

Bloodborne Pathogens

Airborne Pathogens

Chain Saw Safety

Confined Space Entry

Disaster/Emergency Procedures

Driving Safety

Flagger Certification

Fire Extinguisher Training

Employee Safety Orientation

Eye Safety

DESIRED COVERAGE

Specific Excess Workers’ Compensation Insurance

Coverage Form: Coverage quoted should be consistent with policy forms developed by the National Council on Compensation Insurance (NCCI), please outline any variations in your proposal.

LIMIT OF INSURANCE

Excess Workers’ Compensation - Limit of Liability Ten Million Dollars ($10,000,000) per Accident

Employers’ Liability - Limit of Liability One Million Dollars ($1,000,000) per Accident

Self-Insured Retention - One Million Dollars ($1,000,000) per accident

No Aggregate Excess Coverage is to be included

Bids are to be on a flat premium basis without audit

NOTE: Bidders shall submit sample copies of their coverage terms and conditions as well as any relative endorsements, along with the bid submission.

POLICY PERIOD AND RENEWAL OPTIONS

The policy period shall be from 12:01 a.m., August 24, 2021 through 12:01 a.m., August 24, 2022, with options to renew for four (4) additional one (1) year terms by mutual agreement of the Kentucky Transportation Cabinet, Finance and Administration Cabinet, the State Risk and Insurance Services Division, and the Insurer.

PRICE GUARANTEE

All bids shall be guaranteed for 90 days after the opening. Rates must be guaranteed until the expiration of the contract. Price adjustments may be considered for subsequent policy years, only if the insurer notifies the State Risk and Insurance Services Division of the Kentucky Office of the Controller in writing no less than 90 days prior to the expiration date of its intention to change the existing contract rates for the next policy year.

Failure to notify the State Risk and Insurance Division or to provide changes in writing within a timely manner, no later than ninety (90) days prior to renewal, waives any opportunity for change or modification of the contract terms, conditions or premium.

CANCELLATION AND SPECIAL PROVISIONS

The insurer shall provide a ninety (90) day notice of cancellation or non-renewal. Refunds shall be computed on a pro rata basis upon cancellation, whether requested by the insured or the carrier.

METHOD OF PREMIUM PAYMENT

The insured will render payment within 30 days as required in KRS 45.453, upon presentation of two copies of the billing. Premium will be paid on an annual basis.

LEGAL REQUIREMENTS

The vendor is required to comply with all applicable federal, state and local rules, regulations, and statutes, including but not limited to the insurance code in Chapter 304 of the Kentucky Revised Statutes, during the contract term.

Any servicing agents shall be licensed and have on file with the Kentucky Department of Insurance proof of financial responsibility as required under Chapter 304 of the Kentucky Revised Statutes during the contract term.

Any claims adjuster(s) shall be licensed as required under Chapter 304 of the Kentucky Revised Statutes during the contract term.

TAXES

Kentucky Premium Surcharge of 1.8% pursuant to KRS 136.392 applies to all policies issued within the Commonwealth and shall be stated separately on the Bidder Quotation Form.

The Commonwealth, however, is exempt from most other taxes, such as the Federal Excise Tax, and the Kentucky Sales or Use Tax and the Local Government Premium Tax (Municipal Tax).

BIDDER ELIGIBILITY

1. CERTIFICATE OF AUTHORITY

Bids will be accepted from any authorized (admitted) insurer holding a Certificate of Authority from the Commonwealth of Kentucky that meets the minimum requirements of this Solicitation. A Certificate of Authority equates to being licensed in accordance with the Insurance Code, KRS Chapter 304.

If there are no responsive and responsible bidders with Certificates of Authority from the Commonwealth of Kentucky, bids will be accepted pursuant to KRS 304.10-040 as a condition for export; these bids shall be from an "eligible surplus lines insurer", as defined pursuant to KRS 304.10-070. The insurer will have sole responsibility for selecting agent (s), if any. The Commonwealth will issue no Agent-of-Record Letters.

2. A.M. BEST RATING

Bidders shall have a B+ or better A.M. Best Rating. Bidders with an A.M. Best rating lower than B+ shall not be considered. Should the successful bidder drop below a B+ rating from A.M. Best during the contract term, the Commonwealth of Kentucky may take appropriate action to secure or maintain this coverage.

3. SIGNING SOLICITATION

An authorized representative shall complete and sign where identified in this solicitation.

FAILURE TO DO SO MAY RESULT IN THE VENDOR’S OFFER BEING

REJECTED.

4. SOLICITATION SUBMISSION REQUIREMENTS

Vendors shall submit responses and all required attachments by electronic submission in the eProcurement system.

EVALUATION OF THE VENDOR BID AND AWARD PROCESS

An Evaluation Committee will review and evaluate bids. The Evaluation Committee will consider all information provided in the bid when making its recommendation State Risk will award the contract to the Vendor submitting the best bid that meets the needs of State Risk.

FORMAT OF SOLICITATION RESPONSE

Attachments to the on-line bid response should be arranged and labeled in the manner set forth below. Failure to arrange and label your submittal in this manner may result in rejection of your offer.

1. Completed and signed where indicated.

2. EEO Statement.

3. AM Best rating.

4. Endorsements.

5. Sample copies of coverage terms and conditions as well as any relative endorsements.

6. Proof of License.

7. Certificate of Authority.

8. Copies of all quotations and declination letters from every company and market approached in relation to this request for bids, or a statement identifying such companies and markets.

9. A signed statement verifying that the copies of quotations and declinations or other statement identifying such companies and markets submitted with the solicitation response is a true, correct, and complete disclosure of all markets and insurers approached in relation to this request for bids.

10. Bidder Information Sheet signed by a duly authorized representative of the vendor’s organization.

11. Bid Quotation Form 1.

12. Bid Quotation Form 1A – Bid Specification Deviations.

13. Bid Quotation Form 1B – Bid Specification Enhancements.

METHOD OF AWARD

A committee comprised of representatives from the Finance and Administration Office of Procurement, State Risk and Insurance Services Division and the Kentucky Transportation Cabinet will review all eligible bids to ensure they meet the minimum coverage requirements set forth in this solicitation.

The contract will be awarded to the responsive, responsible bidder meeting the minimum criteria of the solicitation with the lowest premium.

SELECTION CRITERIA

The contract shall be awarded to the responsive, responsible bidder meeting the minimum criteria of the solicitation with the lowest premium.

CONTRACT EXECUTION

The original copy of the binder shall be furnished to the State Risk and Insurance Services Division of the Office of the Controller within ten (10) days of award of contract, but no later than two (2) days prior to the effective date of coverage. The original policy and its endorsements shall be furnished within 45 days after the effective date of coverage.

ORIGINAL INSURANCE CARRIER

During the term of this contract, the successful vendor(s) will maintain coverage with the original insurance carrier(s), unless written permission is granted by the Kentucky Office of the Controller, State Risk and Insurance Services Division to place coverage elsewhere. Any request for changes must be provided to the Office of the Controller, State Risk and Insurance Services Division, in writing at least 90 days prior to the expiration of the current policy. Consideration will only be given if it is deemed to be in the best interest of the Commonwealth.

LOSS SUMMARIES

The successful bidder shall provide two (2) copies of annual loss summaries by May 25th to the Kentucky Office of the Controller, State Risk & Insurance Services, 500 Mero Street, 1st Floor, Frankfort, Kentucky 40601. Please include the following information:

a. Policy Number e. Description of Loss

b. Claimant Name f. Amount Reserved

c. Date of Loss g. Amount Paid

d. Claim Status

NOTICES

After the award of contract, all normal communications, exclusive of price considerations, are to be delivered to the address below or to such other addresses or party as is designated:

Buryl L. Thompson, CPCU, AIM, AU Assistant Director State Risk and Insurance Services Kentucky Office of the Controller 500 Mero Street, 1st Floor Frankfort, KY 40601 E-mail: Buryl.Thompson@ky.gov Telephone: 502-782-6543 Fax: 502-564-2693

After the award of the contract, all notices of a contractual nature are to be e-mailed to the buyer below or to such other address or party as is designated:

Debbie Mathews, CPPB, KCPM Statewide Procurement Manager Finance and Administration Cabinet Office of Material & Procurement Services 702 Capitol Avenue, Room 096 Frankfort, Kentucky 40601 E-mail: Debbie.Mathews@ky.gov Telephone: 502-564-8649

GENERAL CONDITIONS AND INSTRUCTIONS FOR SOLICITATIONS AND

CONTRACTS

The General Conditions and Instructions for Solicitations and Contracts, hereby incorporated by reference, shall be an integral part of this solicitation and resulting contract. Therefore, it is the bidder’s responsibility to access and read these General Conditions for Solicitations and Contracts at http://www.state.ky.us/ageneices/finance/manual/pol&proc/FAP110-10-00.doc or request a copy by contacting the Office of Material and Procurement Services. By submitting a bid to the Commonwealth, a bidder agrees to these conditions.

COST OF PREPARING PROPOSAL

Costs for developing the proposals are solely the responsibility of the Bidders. The Commonwealth of Kentucky will provide no reimbursement for such costs.

mailto:Buryl.Thompson@ky.gov mailto:Debbie.Mathews@ky.gov http://www.state.ky.us/ageneices/finance/manual/pol&proc/FAP110-10-00.doc

EXHIBITS

1. Aircraft Details – 2021

2. Aviation Supplemental - 2021

3. Employee Concentration – 2021

4. Vehicle Supplemental – 2021

5. Watercraft Supplemental – 2021

6. Risk Management Supplemental – 2021

7. KYTC Job PPE – 2021

8. WC Temporary Modified Duty Plan

9. Claim Reserves (Total Incurred) – 2021

10. KYTC Loss Run - 2021