COUNTY OF SAN MATEO

Inter-Departmental Correspondence

Employee and Public Services Department

DATE:

May 24, 2002

BOARD MEETING DATE:

June 18, 2002

TO:

Honorable Board of Supervisors

FROM:

Mary Welch, Director of Employee and Public Services
Priscilla Morse, Risk Manager

SUBJECT:

Contract with Keith A. Hillegass Co., Inc.

Recommendation
Adopt a resolution authorizing the President of the Board to execute a five year contract with Keith A. Hillegass Co., Inc. to provide administration and support services for the County's self-insured general and automobile liability claims.

Background
The County has been self-insured for general and automobile liability loss exposures since 1975 and contracts with a third party administrator to administer the claims and provide support services for the program. In the administration of the claims, the administrator conducts the investigation of claims, recommends and negotiates settlements, provides subrogation recovery services and provides support to defense attorneys on litigated cases.

Discussion
In September 2001, an RFP was sent out to six third party claims administrators. In November 2001, three proposals were reviewed by a panel of representatives from EPS and County Counsel as well as an outside risk manager. Additionally, the panel interviewed the proposers and conducted site visits.

The panel determined that the County should to contract with Keith A. Hillegass Co., Inc. based on Hillegass' previous experience with and knowledge of the County, and its excellent reputation in working with County departments including County Counsel and Risk Management. Hillegass' cost was the lowest of the three proposers.

Fiscal Impact
The amount of the contract will be $98,000 per year. The total amount of the five year contract is $490,000. The cost of the services will continue to be paid out of the general and automobile liability trust funds.

Vision Alignment
This item keeps the commitment of responsive, effective and collaborative government through goal number 20: Government decisions are based on careful consideration of future impact, rather than temporary relief or immediate gain.