Insurance bidding saves Lynn $240G

LYNN – Departing from practices adhered to over the past decade, city officials sought bids for municipal insurance coverage and saved $240,000 at a time when schoolteachers face layoffs.According to city Comptroller John Pace, by switching insurance companies, the city will save nearly a quarter-million dollars during fiscal 2011, which started July 1.Pace, who administered a competitive bidding process at the direction of Mayor Judith Flanagan Kennedy, said bids were put out on policies for property, automobiles, liability and equipment. The request-for-proposals were prepared in conjunction with Donohue and Associates, a firm which solicited brokers and assigned coverages.Four companies were chosen as finalists, with Eastern Insurance Group of Natick receiving the contract. Pace said Eastern Insurance’s bid will result in the city spending less and getting better coverage.The city had budgeted $850,000 for insurance for next year. As a result of the change in practice the city will ultimately spend 30 percent less than that, Pace said.The comptroller noted that the insurance policies had not been put out to bid for at least seven years. “The results of the bid process were very favorable to the city,” he said. “We got increased coverages with reduced premiums.”One highlight of the new policy is a reduction in the deductible for a property claim from $50,000 to $25,000. “There are 20 changes from the previous policy and all are to the city’s advantage,” Pace said.In May, the city conducted a similar bid process for its workers’ compensation insurance, resulting in a savings of more than $45,000. Between the two contracts, the city will save more than $285,000 on insurance in fiscal 2011.”The significant savings we will realize on insurance coverage is a prime example of what can happen when government is willing to take a close look at how it conducts its business and is willing to make changes for the benefit of all taxpayers,” Kennedy said.During her first year in office, Kennedy has trimmed $16 million from the previous municipal budget and has vowed to scour the School Department budget for items that can be reduced or eliminated in order to save jobs.