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HomeMy WebLinkAboutP-21-105 Agreement Carl Warren Company.pdf CONFIDENTIAL & PROPRIETARY 1 of 11 THIRD PARTY CLAIMS ADMINISTRATION CONTRACT THIS AGREEMENT, entered into effective APRIL 12, 2021 by and between THE COUNTY OF FRESNO, hereinafter called the "PRINCIPAL," and CARL WARREN & COMPANY, LLC, hereinafter called "CONTRACTOR," is for certain services as outlined in connection with the duties and responsibilities of administering a program of self-insurance. W I T N E S S E T H WHEREAS, PRINCIPAL has undertaken to administer the entitled matters and is in need of a qualified third party to whom to delegate the responsibilities and duties of administering said partially or totally funded program, and WHEREAS, CONTRACTOR is engaged in the supervision and administration of programs for commercial general liability self-insurance, NOW, THEREFORE, PRINCIPAL and CONTRACTOR mutually understand and agree as follows: 1. GENERAL CONTRACTOR shall: (a) Assist PRINCIPAL’S Risk Management with the General Liability program and (c) provide to PRINCIPAL during the Term (as defined below) all the services more particularly set forth in Phase 1 and 2 hereinafter with the understanding that items may be added or deleted at PRINCIPAL’s request. 2. SERVICES CONTRACTOR shall provide the following services in 2 Phases: Phase 1 Step 1: Structure and implement foundation for the GL program. Step 2: Training for internal staff (2 analysts). Step 3: Act on the file review recommendations by PRINCIPAL. Step 4: Provide a review of all open cases and ensure reserves are adequate. Step 5: Subrogation review history of past 2 years, evaluate recoveries for missed opportunities before statute of limitations runs out. Phase 2 Step 1: To be determined in conjunction with PRINCIPAL after Phase 1 is complete P-21-105 CONFIDENTIAL & PROPRIETARY 2 of 11 PHASE GENERAL LIABILITY PROJECT OBJECTIVE SCOPE OF WORK PHASE TIMEFRAME PRINCIPAL SCOPE OF WORK Phase I Develop Risk Management internal protocols for Claims Management, Litigation/Defense Counsel Guidelines, Defense Panel Selection Criteria and Reserve Practice Guidelines. This should reflect current process including the Claims Review Committee activities, a charter for the committee and the process for memorializing the outcomes to ensure they are in the file. Enlist the assistance of an experienced claims adjuster for the specific purpose of developing helping to design system claims management hierarchies, system coding instructions, and file setup. Establish process and protocols. E.g. Investigations, reserve setting, diary updates, memorializing CRC actions, actions on claims, attendance at settlement conferences and depositions, settlements. Develop Defense Counsel Guidelines. E.g. Defense panel selection, legal fees, delegation of legal work within a firm or by County Counsel, reporting, and billing instructions. 1 Up to 3 months Risk Manager or County Counsel Requires a policy discussion about claims and legal defense strategy (e.g., work up all claims as if to defend to the end, reject clearly non-meritorious claims, and/or consider nuisance values.) Phase I Review recommendations in the file review: i.e. file review of open litigated cases to ensure reserves are in order, files are being managed, and assist with complex cases and investigations. Consider 2 FTE trained analysts to provide adequate staffing coverage. Consider a tiered approach to claims adjusting, such as outsourcing more complicated cases or that require claims expertise and investigative services (also see C.2.7). Create Reserving Practices Guidelines. Create a charter to normalize the Claims Review Committee’s process and memorialize the direction given during those reviews in the claims management system. 1 Up to 6 months Risk Manager County Counsel’s Office An additional FTE Risk Analyst has been assigned to the program. Reserving practices guidelines and CRC charter will provide consistency and direction on setting reserves and updates, funding, and excess claims reporting. Phase I Provide training and mentorship of General Liability staff, as needed. Procure services of a consulting claims adjuster to mentor risk analysts using new and open claims as a basis for training. Contractor can serve as a resource to Risk Analysts, as needed. Contractor can assist with complex cases or claims- related investigations 1 Up to 3 months to begin on going Risk Manager or GL Claims Adjuster Requires a short-term, or “as-needed” contract with GL claims expert. Phase 1 Properly sort claims in accordance with claims best practices. 1 Ongoing Risk Manager or GL Claims Adjuster Consistent use of Best Practices in claims handling CONFIDENTIAL & PROPRIETARY 3 of 11 3. SUBROGATION SERVICES The CONTRACTOR will be providing subrogation services as stated in the Fee Schedule in Section 5. CONTRACTOR shall: Supervise and administer the subrogation program for PRINCIPAL, represent PRINCIPAL in all matters related to the investigation, collecting processing, supervision and resolution of subrogation claims against third parties, for damage to PRINCIPAL’S property. This Agreement does not include recovery of damages or costs relating to Workers Compensation Claims, presented by PRINCIPAL’S employees. CONTRACTOR shall provide complete collection services to PRINCIPAL, including receipt and examination of all reports of accident, incidents, claims or cases which are or may be the subject of a subrogation claim. The investigation of such accidents, incidents, claims or cases will include determining responsibility, establishing damage amount, pursuing collection, negotiating settlements and processing of monetary recovery. 4. TERM OF AGREEMENT The term of the Agreement (the “Term”) shall commence on APRIL 12, 2021 and continue until OCTOBER 12, 2021, for the project., unless terminated earlier as provided in Section 13 herein. 5. PRICING PRINCIPAL agrees to pay the following claim handling and service fees for CONTRACTOR’S services: CLAIMS ADMINISTRATION SERVICES TIME & EXPENSE COMPOSITE PRICING Days Per Week Hours Per Week Number of Weeks Total Work Hours Adjuster Per Hour Fee Total Adjuster Services: First 3 Months 2 16 12 192 $95 $18,240 Oversight Fee ($1,000 per month) $3,000 TOTAL:$21,240 Adjuster Services: Second 3 Months After initial 3 months, number of days and weeks to be reviewed and discussed with client for remaining 3 months at same adjuster fee per hour Not to Exceed (NTE) Amount Adjuster hours not-to-exceed $30,000 for the 6-month agreement term. Subrogation (If Utilized) 21% of net recovery Hotel and Mileage expenses shall be in addition to this NTE amount. The above fee schedule for the services does not include “Allocated Expenses”, defined to mean customary and usual costs and expenses incurred and/or paid by CONTRACTOR on PRINCIPAL’S behalf in connection with the investigation, adjustment, settlement or defense of a claim. Such costs and expenses include, but are not limited to, professional photography, police reports, independent medical examinations, professional engineering services, laboratory services, bulk copy jobs, private investigators, legal costs and fees and work performed by accountants. CONTRACTOR shall charge PRINCIPAL for non-staff investigators or adjusters when, in the opinion of CONTRACTOR, such assistance is necessary and reasonably related to the monetary exposure. Allocated Expenses do not include the fees payable to CONTRACTOR pursuant to the fee schedule in this Section 5, nor the salaries, wages or benefits paid to CONTRACTOR’S employees or office and other overhead expenses associated with the performance of the services CONFIDENTIAL & PROPRIETARY 4 of 11 hereunder by CONTRACTOR. PRINCIPAL agrees to pay for the cost of all reasonable and supportable Allocated Expenses incurred in connection with the services under this Agreement. Charges for non-file-related professional services performed at the specific request of PRINCIPAL will be billed on an as quoted basis. 6. PRINCIPAL'S RESPONSIBILITIES PRINCIPAL shall provide CONTRACTOR with copies of all relevant documents upon request and without charge and shall make available any PRINCIPAL employee for interviews by CONTRACTOR at reasonable times concerning any investigation of a claim or incident pursuant to this Agreement. CONTRACTOR shall bill PRINCIPAL and furnish PRINCIPAL with invoices for services rendered in accordance with the fee schedule set forth in the Agreement. Each invoice will include the claim or other matters for which a fee is being charged and the amount of the associated fee for that claim or matter. All sums due hereunder shall be paid by delivery of PRINCIPAL’S check, or wire transfer to CONTRACTOR’S offices located at the address set forth herein, within forty-five (45) days following the invoice date. If any amount invoiced is in dispute, PRINCIPAL shall pay the undisputed amount and notify CONTRACTOR within forty-five (45) days after the invoice date of the disputed portion. 7. CONFLICT OF INTEREST In the event a claim or incident is reported to CONTRACTOR by PRINCIPAL and it is determined that the actual or potential claimants therein are also clients of CONTRACTOR, then CONTRACTOR shall immediately notify PRINCIPAL of such potential conflict of interest so PRINCIPAL may have the option to choose an independent investigator and adjuster. 8. MODIFICATION Any matters of this Agreement may be modified from time to time by the written consent of all the parties without, in any way, affecting the remainder. 9. NON-ASSIGNMENT Neither party shall assign, transfer or sub-contract this Agreement nor their rights or duties under this Agreement without the prior written consent of the other party. 10. CANCELLATION OF AGREEMENT a. Voluntary Termination. This Agreement may be terminated at any time by either party, without cause, by giving the other party not less than thirty (30) days prior written notice of such termination. b. Termination for Cause. This Agreement shall terminate at the election of PRINCIPAL or CONTRACTOR if the other party breaches any material provision of this Agreement and fails to cure such breach within ten (10) business days after written notice thereof is given to the party, or in the event the breach is not capable of being cured within such ten (10) business day period, the breaching party has not commenced good faith efforts to cure such default within ten (10) business days and continued thereafter in good faith to diligently pursue the completion of such cure. Failure of PRINCIPAL to comply with Section 6 CONFIDENTIAL & PROPRIETARY 5 of 11 PRINCIPAL’S RESPONSIBILITIES shall qualify as cause under this Section. c. Termination by CONTRACTOR. CONTRACTOR may terminate this Agreement pursuant to Section 14(f). 11. DISPOSITION OF FILES ON TERMINATION OF AGREEMENT a. All files on each claim shall be property of the PRINCIPAL. b. In the event of expiration of the Agreement, non-renewal thereof, or cancellation, CONTRACTOR shall bill the PRINCIPAL, subject to the rates quoted in Section 6 herein above, for work completed by CONTRACTOR on each claim. 12. INSURANCE Without limiting the PRINCIPAL's right to obtain indemnification from CONTRACTOR or any third parties, CONTRACTOR, at its sole expense, shall maintain in full force and effect, the following insurance policies or a program of self-insurance, including but not limited to, an insurance pooling arrangement or Joint Powers Agreement (JPA) throughout the term of the Agreement: Commercial GeneralLiability: Commercial General Liability Insurance with limits of not less than two million dollars ($2,000,000) per occurrence and an annual aggregate of four million dollars ($4,000,000). This policy shall be issued on a per occurrence basis. PRINCIPAL may require specific coverages including completed operations, products liability, contractual liability, Explosion-Collapse-Underground, fire legal liability or any other liability insurance deemed necessary because of the nature of this contract. Automobile Liability: Comprehensive Automobile Liability Insurance with limits of not less than One Million Dollars ($1,000,000) per accident for bodily injury and for property damages. Coverage should include any auto used in connection with this Agreement. Professional Liability: Not limited to licensed professional staff, (e.g., Ph.D., R.N., L.C.S.W., M.F.C.C.)inprovidingservices,ProfessionalLiabilityInsurancewithlimitsofnotless thantwo million dollars ($2,000,000) per occurrence, two million dollars ($2,000,000) annual aggregate. CONTRACTOR agrees that it shall maintain, at its sole expense, in full force and effect for a period of three (3) years following the termination of this Agreement, one or more policies of professional liability insurance with limits of coverage as specified herein. Cyber Liability: Cyber Liability Insurance with limits of not less than one million dollars ($1,000,000) per occurrence, two million dollars ($2,000,000) annual aggregate Worker's Compensation: A policy of Worker's Compensation insurance as may be required by the California Labor Code. Additional Requirements Relating to Insurance: CONTRACTOR shall obtain endorsements to the Commercial General Liability insurance naming the County of Fresno, its officers, agents, and employees, individually and collectively, as additional insured, but only insofar as the operations under this Agreement are concerned. Such coverage for additional insured shall apply as primary insurance and any other insurance, or self- insurance, maintained by PRINCIPAL, its officers, agents, and employees shall be excess CONFIDENTIAL & PROPRIETARY 6 of 11 only and not contributing with insurance provided under CONTRACTOR's policies herein. This insurance shall not be cancelled or changed without a minimum of thirty (30) days advance written notice given to PRINCIPAL. CONTRACTOR hereby waives its right to recover from PRINCIPAL, its officers, agents, and employees any amounts paid by the policy of worker’s compensation insurance required by this Agreement. CONTRACTOR is solely responsible to obtain any endorsement to such policy that may be necessary to accomplish such waiver of subrogation, but CONTRACTOR’s waiver of subrogation under this paragraph is effective whether or not CONTRACTOR obtains such an endorsement. Within Thirty (30) days from the date CONTRACTOR signs and executes this Agreement, CONTRACTOR shall provide certificates of insurance and endorsement as stated above for all of the foregoing policies, as required herein, to the County of Fresno, (Steve Johnson, County of Fresno Risk Manager, 2220 Tulare Street, 16th Floor, Fresno, CA 93711), stating that such insurance coverage have been obtained and are in full force; that the County of Fresno, its officers, agents and employees will not be responsible for any premiums on the policies; that such Commercial General Liability insurance names the County of Fresno, its officers, agents and employees, individually and collectively, as additional insured, but only insofar as the operations under this Agreement are concerned; that such coverage for additional insured shall apply as primary insurance and any other insurance, or self-insurance, maintained by PRINCIPAL, its officers, agents and employees, shall be excess only and not contributing with insurance provided under CONTRACTOR's policies herein; and that this insurance shall not be cancelled or changed without a minimum of thirty (30) days advance, written notice given to PRINCIPAL. In the event CONTRACTOR fails to keep in effect at all times insurance coverage as herein provided, the PRINCIPAL may, in addition to other remedies it may have, suspend or terminate this Agreement upon the occurrence of such event. All policies shall be issued by admitted insurers licensed to do business in the State of California, and such insurance shall be purchased from companies possessing a current A.M. Best, Inc. rating of A FSC VII or better. 13. MISCELLANEOUS a. Governing Law. This Agreement shall be construed and enforced in accordance with and governed by the laws of the State of California. Venue for any action arising out of or related to this Agreement shall only be in Fresno County, California. b. Amendments, etc. Neither this Agreement nor any of the terms hereof may be amended, changed, waived, discharged, or terminated except by an instrument in writing signed by both of the parties hereto. c. No Waiver. No delay on the part of any party hereto in exercising any right, power or privilege hereunder shall operate as a waiver thereof; nor shall any waiver on the part of any party hereto of any such right, power or privilege, or any single or partial exercise of any such right, power or privilege, preclude any further exercise thereof or the exercise of any other right, power or privilege. CONFIDENTIAL & PROPRIETARY 7 of 11 d. Severability. If any part of this Agreement is contrary to, prohibited by or deemed invalid under, any applicable law of any jurisdiction, then such provision shall, as to such jurisdiction, be inapplicable and deemed omitted to the extent so contrary, prohibited or invalid, without invalidating the remainder hereof or affecting the validity or enforceability of such provision in any other jurisdiction. e. Independent Contractor: In performance of the work, duties and obligations assumed by CONTRACTOR under this Agreement, it is mutually understood and agreed that CONTRACTOR, including any and all of the CONTRACTOR'S officers, agents, and employees will at all times be acting and performing as an independent contractor, and shall act in an independent capacity and not as an officer, agent, servant, employee, joint venture, partner, or associate of the PRINCIPAL. Furthermore, PRINCIPAL shall have no right to control or supervise or direct the manner or method by which CONTRACTOR shall perform its work and function. However, PRINCIPAL shall retain the right to administer this Agreement to verify that CONTRACTOR is performing its obligations in accordance with the terms and conditions thereof. CONTRACTOR and PRINCIPAL shall comply with all applicable provisions of law and the rules and regulations, if any, of governmental authorities having jurisdiction over matters the subject thereof. Because of its status as an independent contractor, CONTRACTOR shall have absolutely no right to employment rights and benefits available to PRINCIPAL employees. CONTRACTOR shall be solely liable and responsible for providing to, or on behalf of, its employees all legally required employee benefits. In addition, CONTRACTOR shall be solely responsible and save PRINCIPAL harmless from all matters relating to payment of CONTRACTOR'S employees, including compliance with Social Security withholding and all other regulations governing such matters. It is acknowledged that during the term of this Agreement, CONTRACTOR may be providing services to others unrelated to the PRINCIPAL or to this Agreement. f. CurrentLaw & Regulation. This Agreement is entered intowith the understanding that existing Federal, State, or other jurisdictional regulations will remain in effect for the duration of this Agreement. PRINCIPAL agrees that should administrative or other costs of service provided hereunder be substantially increased as a result of modifications in existing law, enactment of new legislation, or promulgation of new administrative guidelines, CONTRACTOR service fees may be renegotiated during the Agreement term. If revised fee agreements cannot be reached, CONTRACTOR may terminate this Agreement, at its option, after thirty (30) days written notice to PRINCIPAL. g. Audits And Inspections: The CONTRACTOR shall at any time during business hours, and as often as the PRINCIPAL may deem necessary, make available to the PRINCIPAL for examination all of its records and data with respect to the matters covered by this Agreement. The CONTRACTOR shall, upon request by the PRINCIPAL, permit the PRINCIPAL to audit and inspect all of such records and data necessary to ensure CONTRACTOR’s compliance with the terms of this Agreement. If this Agreement exceeds ten thousand dollars ($10,000), CONTRACTOR shall be subject to the examination and audit of the Auditor General for a period of three (3) years after final payment under contract (Government Code section 8546.7). CONFIDENTIAL & PROPRIETARY 8 of 11 h. Notices: The persons and their addresses having authority to give and receive notices under this Agreement include the following: COUNTY CONTRACTOR COUNTY OF FRESNO Richard McAbee Carl Warren & Company, LLC HUMAN RESOURCES Fresno County Plaza 2220 Tulare St, 16th Floor Fresno, CA 93721 17862 E. 17th St, Suite 111, Tustin, CA 92780 All notices between the PRINCIPAL and CONTRACTOR provided for or permitted under this Agreement must be in writing and delivered either by personal service, by first-class United States mail, by an overnight commercial courier service, or by telephonic facsimile transmission. A notice delivered by personal service is effective upon service to the recipient. A notice delivered by first-class United States mail is effective three PRINCIPAL business days after deposit in the United States mail, postage prepaid, addressed to the recipient. A notice delivered by an overnight commercial courier service is effective one PRINCIPAL business day after deposit with the overnight commercial courier service, delivery fees prepaid, with delivery instructions given for next day delivery, addressed to the recipient. A notice delivered by telephonic facsimile is effective when transmission to the recipient is completed (but, if such transmission is completed outside of PRINCIPAL business hours, then such delivery shall be deemed to be effective at the next beginning of a PRINCIPAL (business day), provided that the sender maintains a machine record of the completed transmission. For all claims arising out of or related to this Agreement, nothing in this section establishes, waives, or modifies any claims presentation requirements or procedures provided by law, including but not limited to the Government Claims Act (Division 3.6 of Title 1 of the Government Code, beginning with section 810). i. Disclosure of Self-Dealing Transactions: In order to conduct business with the PRINCIPAL, members of a contractor’s board of directors (hereinafter referred to as “County Contractor”), must disclose any self-dealing transactions that they are a party to while providing goods, performing services, or both for the PRINCIPAL. A self- dealing transaction is defined below: “A self-dealing transaction means a transaction to which the corporation is a party and in which one or more of its directors has a material financial interest” The definition above will be utilized for purposes of completing this disclosure form Exhibit A below. INSTRUCTIONS 1) Enter board member’s name, job title (if applicable), and date this disclosure is being made. 2) Enter the board member’s company/agency name and address. 3) Describe in detail the nature of the self-dealing transaction that is being disclosed to the County. At a minimum, include a description of the following: a. The name of the agency/company with which the corporation has the CONFIDENTIAL & PROPRIETARY 9 of 11 transaction; and b. The nature of the material financial interest in the Corporation’s transaction that the board member has. 4) Describe in detail why the self-dealing transaction is appropriate based on applicable provisions of the Corporations Code. 5) Form must be signed by the board member that is involved in the self-dealing transaction described in Sections (3) and (4). CONFIDENTIAL & PROPRIETARY 10 of 11 j. Counterparts. This Agreement may be executed simultaneously in two counterparts, each of which when so executed and delivered shall be deemed an original, but both of which together shall constitute one and the same instrument, and all signatures need not appear on any one counterpart. A facsimile, telecopy or other reproduction of this Agreement may be executed by any party and delivered by such party by facsimile or other electronic transmission (including e-mail), and such CONFIDENTIAL & PROPRIETARY 11 of 11 execution and delivery shall be considered valid, binding and effective for all purposes. IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be signed by their duly authorized representatives as of the day and year first written above. (CONTRACTOR) (PRINCIPAL) CARL WARREN & COMPANY, LLC COUNTY OF FRESNO Company Name Entity Name Signature Signature Richard McAbee Gary Cornuelle Print Name Print Name Chief Marketing Officer Purchasing Manager Title Title Date Date