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HomeMy WebLinkAboutContracts & Agreements_211-2017 CLAIMS ADJUSTING AND ADMINISTRATION SERVICE CONTRACT This agreement for claims adjusting and administration services ("Agreement") is made effective as of the 31d day of October, 2017, by and between the City of Redlands (hereinafter "CITY"), and GEORGE HILLS COMPANY, INC (hereinafter"GH") GH is a California Corporation doing business as licensed, independent insurance adjusters and administrators, with John Chaquica, CEO, responsible for contract compliance and terms Randy Rendig, President Claims Administration, shall oversee the daily operations GH's corporate office is located at 3043 Gold Canal Dr , Suite 200, Rancho Cordova, California, 95670, telephone, (916) 859-4800 CITY is located at 35 Cajon Street, Suite 10, Redlands, CA 92373 In consideration of the mutual promises contained herein, it is hereby agreed by and between GH and CITY as follows I GENERAL CITY is desirous of availing itself of property and liability claims adjusting and administrative services GH is a claim administrative firm experienced in the handling of self-insured claims and is ready to and capable of performing such services As such, GH shall act as a representative of CITY under the direction of Human Resources/Risk Management Department Director, and in conjunction with the City Attorney for purposes of establishing and maintaining the attorney-client and work product privileges, associated with the investigation, adjustment processing, supervision and evaluation of general liability, motor vehicle, and potential money damage claims filed by third parties against CITY, or against parties for whom CITY is alleged to be legally responsible, which are premised upon allegations of willful, intentional, negligent, or careless acts and/or omissions II $COPE OF SERVICE5 GH agrees to provide complete claim handling services subject to the California Government Claims Act or any other applicable laws relating to claims, on each accident or incident which is or may be the subject of a claim Such services shall include the following A INVESTIGATIVE SERVICES GH agrees to provide complete investigative services including, but not limited to 1) Receipt and examination of all reports of accidents or incidents that are or may be the subject of claims 2) Investigate accidents or incidents as warranted, to include on-site investigation, photographs, witness interviews, determination of losses and other such investigative services necessary to determine all CITY l•Icaldjm4AgreementslRedlands George Hill Agreement docx page i of 18 losses, but not to include extraordinary investigative services outside the expertise of GH 3) Maintain service on a 24-hour, 7 days per week basis, to receive reports of any incident or accident which may be the subject of a claim and provide immediate investigative services to the extent necessary to provide a complete investigation 4) Undertake items of investigation requiring special handling for CITY at the direction of CITY's attorney or authorized representative B LIABILITY AND PROPERTY CLAIM HANDLING SERVICES GH agrees to provide complete claim handling services on each accident or incident which is or may be the subject of a claim Such services shall include the following 1) Promptly set up a claim file upon receipt of the claim and maintain a claim file on each potential or actual claim reported 2) Assess and evaluate the nature and extent of each claim and establish claims reserves for indemnity and legal expense 3) GH will work under CITY protocol to ensure issuance of all official responses to claimant 4) Ensure timely claim handling, including contact and follow-up with claimants regarding claim issues and processing 5) Determine the need for defense representation recommend legal counsel, and manage litigation activity 6) Report claims to CITY's excess insurer and coordinate with the excess insurer on a claim's progress in accordance with the excess insurer's reporting requirements 7) Maintain records on any such claim and notify CITY when CITY is about to exhaust its self-insured retention 8) Obtain settlement contracts and releases upon settlement of claims or potential claims not in litigation 9) Perform the necessary data gathering for the Medicare, Medicaid, and SCRIP Extension Act of 2007 (MMSEA) and the Set Aside Contracts in compliance with Section 111 of the MMSEA including the required reporting (see Attachment A) 10)Provide an account manager and lead adjuster I 1cakdjm4AgreementsV7edlands George Hill Agreement docx page 2 of 18 C LEGAL SUPPORT SERVICES GH agrees to provide the following legal support services on each claim in which a third-party claimant has commenced, or threatened to commence, litigation 1) Upon notification by CITY that litigation has been filed on an open claim, contact and provide CITY's approved counsel with all information and files concerning the claim 2) Cooperate with and assist any defense counsel assigned to litigation of open claims and provide such investigative services as directed during pre-trial and trial stages 3) Assist in responding to discovery or preparing discovery 4) At the request of CITY, attend mandatory settlement conferences on behalf of CITY 5) At the request of CITY, appear on behalf of CITY in small claims actions filed against CITY on open claims handled by GH 6) Review, evaluate and adjust defense counsel statements for services 7) Regularly and reasonably discuss, review, and direct investigation issues, discovery, and case strategy with counsel 8) Review and evaluate case evaluations, correspondence and status reports forwarded to GH by counsel 9) Cooperate with counsel as a team with an open communication approach on each case to obtain the most economical and best result for CITY D REPORTS AND PROCEDURES As required to excess reporting agency/carrier, GH agrees to provide the following 1) Within thirty (30) days of assignment, or sooner if practicable, required, or requested, GH will provide CITY with a full factual report, showing name(s) of claimant(s), type of claim, date of loss, comments on liability, reserve recommendations, settlement recommendations, and other pertinent information Subsequent to the initial thirty (30) day report, GH will report as often as warranted by any important change in status but no longer than every (90) days until the claim closes unless extended diary is appropriate 2) All original reports, documents, and claim data of every kind or description, that are prepared, in whole or in part, by or for, GH in connection with this Agreement shall be CITY's property and I lcaldjmlAgreements4Redlands George Hill Agreement docx page 3 of 18 constitute GH's work product for which compensation is paid A copy of all reports, documents, and claim data of every kind or description that is in whole or in part by or for CITY is the property of GH Additional copies of original reports, documents, and data requested by CITY will be at CITY's expense in accordance with this Agreement 3) GH agrees that CITY and its auditors shall have access and the right to audit and reproduce any of GH's relevant records to ensure that CITY is receiving all services to which CITY is entitled under this A g r e e m e n t or for any purpose relating to this Agreement E DATA GH agrees to perform the following 1) Utilize its"State of the Art" claims information system—SIMS 2) Record all claim information including all financial data 3) Provide CITY °Read Only" on-line access to the claims data system, if desired by CITY (up to five users) 4) Provide monthly standard loss run and check register 5) Provide annual claims data report for actuary and auditors upon request 6) Provide assistance to CITY in developing customized reports when requested (may require additional charge) 7) Provide Conversion/Data Import a Open Claims (by October 3, 2097) b Closed Claims (within 12 months of contract start) NOTE GH will work with CITY to import all closed claim information from source documents into GH's claims system F CLAIM REVIEW MEETINGS GH shall, on a mutually agreed periodic basis, meet with CITY to review and discuss claims inventory and claims results of past period and delivery of services by GH G FINANCIAL ACCOUNTING GH shall provide the following 1) Establish and maintain a trust fund for the purpose of paying indemnity McaldjmlAgreementsRedlands George Hill Agreement docx page 4 of 18 and expenses that may be due on the claims The amount to be maintained in the trust fund shall be determined by CITY CITY agrees to use California Bank and Trust, the GH preferred bank to expedite the process 2) Maintain a copy of all checks drawn by GH to pay claims and claims related expenses 3) Submit monthly check registers of all transactions made for the period 4) Complete or update Attachment B"Preferred Method of Check Processing"for check processing options H SUBROGATION GH is a claim administrative firm experienced in the handling of subrogation claims and is ready and capable of performing such services Such services are distinct from subrogating a loss from an additional insured from a claim filed by a third party G H ' s services are unique to a first party loss of CITY caused by the intentional or negligent act of a third party Such losses generally are for the recovery of damages, loss, and/or additional types of damages including, but not limited to the following 1) Labor costs for district or other personnel responding to or in any manner providing services, 2) Services provided by outside vendors, 3) Vehicle or equipment use, and/or 4) Additional fees that may be specific to the individual entity that are provided for within district ordinances or other governing document I CITY may, at CITY's own expense 1) Authorize GH to act as a representative of CITY for the investigation, adjustment, processing, supervision and evaluation of —and ultimate recovery of —potential money from damage claims against parties for whom it is alleged to be legally responsible 2) By prior written acknowledgment, authorize GH to engage the services of a litigation attorney to consult, review, and determine the best legal strategy available at the time to obtain the best possible result for CITY Upon determination by the attorney that a civil action is in the best interest of CITY, GH will notify CITY and obtain authorization to pursue recovery in accordance with the recommendations of the litigation attorney, or While GH is handling a subrogation claim for CLIENT pursuant to the terms of this Agreement, the institution of a civil action is determined by CITY to be the best course of action, CITY may, at CITY's own expense i IcaldjmlAgreementslRedlands George!dill Agreement.docx page 5 of 18 1) Recall the claim to CITY's control so that CITY may pursue recovery in a manner to be determined by CITY's attorney to be in the best interest of CITY In the event CITY recalls the claim as indicated above, CITY shall be responsible for payment to GH of any and all time and expense incurred by GH's subrogation claim adjuster and/or other subrogation specialist up to the time wherein the claim has been recalled by CITY III DENIAL COMPROMISE OR SETTL F CLAIMS It is agreed that CITY has not granted GH any monetary authority for the purpose of compromising, settling, and paying any claims against CITY being handled by GH or for the purpose of issuing payment for legal expenses Prior written approval to compromise or settle any claim, or pay any expense shall be obtained by GH from CITY for any of the foregoing items described in this Section III IV. ELLgM-TENTION GH shall retain all documents in accordance with CITY's record retention policy, up to a maximum of seven (7) years After seven (7) years unless requested by CITY to retain at its own expense, GH shall delete the scanned files in accordance with the timeline stated in Attachment C V CONFIDENTIALITY All data, documents, discussions, or other information developed or received by or for GH In its performance of this Agreement are confidential and not to be disclosed to any person except as authorized in writing by CITY, or as required by law VE CONFLICT OF INTEREST In the event GH receives a claim from CITY in which there arises a "conflict of interest," GH shall immediately notify CITY In writing CITY may then, at its expense, choose to hire another well-qualified claims firm to handle that particular claim to a conclusion GH covenants that it presently knows of no interest, direct or indirect, which would conflict in any manner with the performance of services required under this Agreement VIE CITY RESPONSIBILITY CITY agrees to the following 1) To cooperate with GH as may be reasonably necessary for GH to perform its services 2) To provide direction to GH, as reasonably requested by GH, regarding particular project requirements 1.1ca1d`mlAgreementsRedlands George Hill AgreemenLdocx page 6 of 18 3) To identify primary contact person for account as well as for billing and loss run submission In addition, CITY shall be responsible for reporting all changes thereto 4) To be responsible for reporting all Bodily Injury Claims in addition to all other items noted in Attachment A "Medicare, Medicaid, and SCHIP Extension Act of 2007 (MMSEA)" 5) For updating GH on any changes to coverage/policy language, including limits, retentions/deductibles and coverage changes VIII COMPENSATION CITY agrees to pay GH for claim services described in Section 11 — Scope of Services Time and expense charges will be incurred only when necessarily required in the form of adjuster's fees as delineated in Section 11, Scope of Services and will be invoiced monthly as worked (See Exhibit B) 1) Time and expense fees will be as follows a Adjuster's Fee $ 85 per hour, not to exceed $69,000 00 annually The above compensation shall apply to services provided during the first year of this five-year Agreement Compensation for services provided during subsequent years may be re-negotiated annually Such change, if any, shall be submitted to CITY by June 30th of each year, in writing b Auto Expense Standard IRS rate c Claims Processor Should there be a need for a Claims Processor, the rate shall be $65 per hour d Allocated file expenses to be paid at cost (See Exhibit A) e Custom reporting beyond the above will be furnished upon request at an additional cost to be agreed upon by GH and CITY f Catastrophic Should a catastrophic event occur resulting in 10 or more claims, CITY shall be billed as follows I To be billed at GH's standard hourly rate, at the time of event 2) Annual Administration Fee with Check Writing $2,500 00 (Billed annually on July Ist), and shall be for the following a Data access to claims data system b Monthly listing of open claims by date of loss, department, location, and 1,Ica1djm1AgreementslRed1ands George Hill Agreement docx page 7 of 18 alpha by name showing expense categories reserves and total incurred c Monthly claim summary reports, within 15 days of month-end d Provide loss run data and required reports for actuarial and auditing purposes e Provide annual summary of claims activity f Financial accounting if applicable 3) Start Up Fee (One Time) $1,500 00 (Billed upon signing of contract) 4) Subrogation Fee GH will bill the greater of $250 or 30% of each and every recovery obtained If there is no recovery, then no fees will apply GH has the authority to reject any claim for any reason, relieving CITY of any fiscal responsibility for refected claims only 5) Subrogation Generally, no recovery shall be agreed to involving payment plans if the recovery is less than $5,000 and/or greater than one year term Exceptions can be made on a case by case basis If a recovery is agreed to above this amount, subrogation fee shall be 45% In the event a payment plan is authorized and entered into, the subrogation fee will be based upon the total amount of the lien and will be invoked to the client upon the entry of the payment agreement GH will make every attempt to enforce the provisions of the payment agreement with the claimant but in no way guarantees the fulfillment of the terms of the payment agreement In the event the terms of the payment agreement are not fulfilled and warrant pursuit through the small claims process, authority to pursue through small claims will be requested 6) Subrogation Authorize GH to appear in small claims court or recovery of funds Authority for the pursuit of recovery through small claims will be requested prior to the filing of documents with the court to initiate the small claims action Each appearance will be an additional fee of$150 All costs for the handling of the small claims i e service of process of documents on the responsible parties, mileage, parking, and toll shall be an additional cost and will be the responsibility of CITY 7) Subrogation Additional allocated costs shall be biped separately upon the cost being incurred, such as, but not limited to skip tracing, service of process and third-party sub contracted investigation 8) Subrogation GH reserves the right to cease working on any claim whereas information not made available within 120 days, at such time the claim will be closed 9) Due to the nature of these services, in that compensation is contingent upon success of time and effort if the contract is terminated prior to completion of effort on any one lien, CITY shall pay GH for all time spent, to date, on any liens currently open and seeking recovery on Payment shall be based on the current 1'lcaWjmtAgreementslRedlands George Hill Rgreement.docx page 8 of 18 hourly rate of GH GH will submit the final invoice within five business days of termination 10) Data Conversion If GH is not retained for the full length of the proposed contract, then 20% per year not retained shall be charged to the client The data conversion fee is dependent on many factors which will need to be discussed IX PAYMENT,5„QUEDULE GH will submit its bills to CITY, and payment shall be made by CITY within a reasonable period of time, not to exceed thirty(30) days after CITY's receipt of any such bill X. TERM AND TERNUJQd, The term of this Agreement shall commence on October 3, 2017, and end on June 30, 2022, unless earlier terminated pursuant to the provisions of this Agreement Termination for Convenience CITY may, at any time and for any reason, terminate this Agreement upon written notice to GH Notice shall be deemed served on the date of mailing Upon receipt of such notice, GH shall immediately discontinue services in connection with the scope of services of this Agreement Upon such termination, GH shall be entitled to payment from CITY as follows GH shall be paid for services completed and provided prior to notice of termination, at GH's current hourly rate Termination Costs If termination takes place three (3) years or less from start of the term of this Agreement, CITY may be subject to a fee, intended to cover costs associated with data conversion, transition and the termination of this Agreement Upon completion of data conversion back to CITY (electronic and/or hard copy), GH will purge all files, except as defined in Section IV File Retention and Attachment C for active CITY records XI. FAIR EMPLOYMEN,J It is the policy of G H to provide fair and equal treatment to all staff members G H is an Equal Opportunity Employer and does not discriminate in any way against any person on the basis of age, race, sex, color, national origin, national ancestry, physical disability, medical condition, mental disability, religion, creed, marital status, sexual orientation, gender identification, gender expression, use of family care leave or any other classification deemed protected by law XII INDEPENDENT CONTRACTOR, In performing claims administrative services herein agreed upon, GH shall have the status of an independent contractor and shall not be deemed to be an officer, employee, or agent of CITY XIII 1NDFMNIFICATION 1.1caldjmlAgreementsVRedlends George Hill Agreement docx page 9 of 18 GH will defend, indemnify, and hold harmless CITY from and against all claims demands, actions, or causes of action, which may arise, from the action, conduct, or failure to act by GH personnel In those cases wherein GH is named in a filed or verified complaint simply by virtue of the fact it is the CLAIMS ADMINISTRATION firm on a given claim, CITY will defend GH, at no cost to GH, CITY will defend, indemnify, and hold harmless GH from and against all claims, demands, actions, or causes of action, which may arise, from the action, conduct, or failure to act by CITY XIV JNSURANCE GH shall provide CITY with Certificates of Insurance duly executed by an insurance company or companies authorized to transact business in the State of California, and said Certificates shall certify that GH has in full force and effect $1,000,000 coverage applying to bodily injury, personal injury, property damage, errors and omissions coverage, statutory workers compensation coverage, and shall also maintain an employee fidelity bond in the amount of$500,000 Thirty (30) days' notice, in writing, prior to cancellation or reduction in coverage will be provided XV F&PLOYEE SOLICITATION During the term of this Agreement, and for a period of one (1) year thereafter, GH agrees not to solicit for employment any CITY employee contacted during the performance of this Ag reement, CITY agrees not to solicit for employment, or employ, during the t e r m of this A g r e e m e n t , and for a period of one (1) year thereafter, any employee of GH contacted by CITY during the performance of this Agreement XVI ff"ITS LICENSES_CERTIFICATES GH, at GHS sole expense, shall obtain and maintain during the term of this Agreement, all permits, licenses, and certificates required in connection with the performance of services under this Agreement, including an appropriate CITY-issued business license XVII ARBITRATION GH and CLIENT agree that in the event of any dispute with regard to the provisions of the Contract, the services rendered or the amount of GH'S compensation the dispute shall be submitted to arbitration upon mutual contract of the parties, under such procedures as the parties may agree upon or if the parties cannot agree, then under the Rules of the American Arbitration Association Each party shall bear the cost of attorney, with losing party paying fees XVIII NOTICES All notices to GH shall be personally served or mailed, postage prepaid, to the following address George Hills Company 3043 Gold Canal Drive, Suite 200, Rancho McMdjmlAgraementslRedlands George Hill Agreement docx page 10 of 18 Cordova, CA 95670 All notices to the CITY shall be personally served or mailed, postage prepaid, to the following address City of Redlands, Risk Manager, 35 Capon Street, Suite 10, Redlands, CA 92373 GH and CITY agree that the terms and conditions of this Agreement may be reviewed or modified at any time Any modifications to this Agreement, however, shall be effective only when agreed to in writing by both CITY and GH XIX ENTIRE AGREEMENT GH and CITY agree that this Agreement constitutes the entire agreement of the Parties regarding the subject matter described herein and supersedes all prior communications, contracts, and promises, either written or oral XX IIME OF ESSENCE Time is of the essence in respect to all provisions of this Agreement that specify a time for performance provided, however that the foregoing shall not be construed to limit or deprive a Party of the benefits of any grace or use period allowed in this Agreement lo ' l� BY Date John E�Chaquica, CEO G ORGE HILLS COMPANY INC /4-4-17 BY t JCS-�23C L/� Date 'y Paul W Foster, Mayor ATTEST. Jea Donaldson, City Clerk hca1djm1AgreementslRedlands George Hill Agreement.docx page 11 of 18 ATTACHMENT A MEDICARE, MEDICAID, AND SCHIP EXTENSION ACT OF 2007 (MMSEA) This law requires liability insurers, self-insurers, no fault insurers and workers' compensation insurers to report certain information to The Centers for Medicare and Medicaid Services (CMS) concerning Medicare beneficiaries The penalty for failure to comply is $1 000 per day, per claimant George Hills Company, Inc (GH) has contracted with ExamWorks for Mandatory Insurer Reporting (MIR) for CITY ExamWorks shall represent CITY and Responsible Reporting Entity (RRE) to this existing contract and this addendum, and will be the designated reporting agent GH will be responsible for gathering and reporting accurate claims data required by MMSEA to ExamWorks in a timely manner GH agrees to assume the responsibility for reporting data to ExamWorks to meet all reporting requirements in accordance with MMSEA, on behalf of the RRE, including assuming responsibility for any fines or penalties that are directly caused by GH's non-compliance GH further agrees to indemnify and hold-harmless, RRE, and staff, for any penalties or fines resulting from GH's direct failure to timely and accurately provide the reporting data to ExamWorks The above-mentioned obligations to indemnify and hold-harmless shall not be applicable to matters relating to delays caused by RRE or other third parties, or inaccurate data supplied to GH by RRE or other third parties By contract with GH, ExamWorks will indemnify and hold GH harmless from and against any claim damage, fine, loss and expense, arising in connection with, or as a result of, any error, omission, or negligent performance of its obligations as reporting agent, which indemnity will include all reasonable costs of litigation and attorneys' fees incurred Without in any way limiting the indemnity set forth in this Contract, all work performed by ExamWorks will be done in a good and professional manner GH shall perform the necessary data gathering for RRE and ExamWorks, as such GH shall include in our monthly invoicing the time for such work at our contract hourly rate, or will be included in your monthly flat fee or claims adjusting ExamWorks will perform the MMSEA Mandatory Insurer Reporting function for GH, and its RREs, shall be charged as an Allocated Expense, as defined in Exhibit A, subject to the following RRE will designate ExamWorks, unless otherwise requested, as its exclusive vendor for all of RRE's "Qualified Referrals" (those claims determined to require Medicare Set Aside (MSA) or a Claim Settlement Allocation (CSA) and RRE will utilize other ExamWorks services related to Medicare Secondary Payer(MSP) compliance identified in their fee schedule McaldlmlAgreements4Redtands George HillAgreement.docx page 12 of 18 ATTACHMENT B PREFERRED METHOD OF CHECK PROCESSING 1 Selection of Bank a) Clients Choice ❑ Name Address Please provide signature cards, sample check, starting check number, name of contact person b) GH uses CA Bank &Trust Q 2 Trust Balance Desired $ 3 Account funding GH will notify client when the balance falls below required balance 4 GH Standard Procedure Number of Signature(s) Required a) One signature from GH Additional Options b) Two on all checks ❑ C) Two on checks in excess of$ ❑ 41 If two signatures are required please specify a) Both GH ❑ b) One GH, one client, over a set amount agreed upon by all parties ❑ GH signers John Chaquica, CEO, Randy Rendig, President, Kimberly Santin Finance Director 5 Accountability a) Positive Pay Yes ❑No ❑ GH recommends positive pay to mitigate the potential for fraud b) Daily check registers Yes ❑ No ❑ C) Statement to be balanced by client ❑ d) Statement to be balanced by GH with copies to client ❑ l•1ca1djm1AgreementslRedlands George Hill Agreement.docx page 13 of 18 ATTACHMENT C TIME LINE FOR RECORD RETENTION Claim Files with TPA 7 years after date closed GH shall scan and delete all files in accordance with the timeline stated in Attachment C Claims Involving Minors 3 years from age 18 or 7 years whichever is longer from closure Litigated Claims Files 5 years after litigation is concluded Formal Notice of Liability Claim Closed + 2 years unless litigated General Correspondence 3 years Incident Reports Closed + 2 years unless litigated Investigative Files and Tapes 7 years Loss Runs Current year-end report+ 7 years Claims Adjusting and Administration Services Between the City of Redlands and George Hills Company page 14 of 18 EXHIBIT A ALLOCATED EXPENSES ExpensesAllocated Typically, allocated expenses are those expenses that are generated by a claim (by outside vendors other than George Hills) that cannot be foreseen nor included in an agreement These are generally allocated back to the specific claim file for which the cost was incurred and then charged back to the entity whose claim incurred that cost. In most situations are pass-through costs for services and/or fees not directly generated by the TPA, but rather by a third-party consultant where the TPA has acted as an agent on behalf of the entity to necessarily outscore services to a third-party consultant and/or miscellaneous fees applicable to the specific claim applied by an outside entity, such as a court or copy service Below, George Hills has provided a list, by no means an exhaustive list, of typical allocated expenses • Fees of outside counsel for claims in suit, coverage opinions and litigation, and for representation and hearings or pretrial conferences, • Fees of court reporters, • All court costs, court fees, and court expenses, Fees for service of process, • CMS reporting costs and fees(ExamWorks), • Costs of undercover operatives and detectives, • Costs for employing experts for the preparation of maps, professional photographs, accounting chemical or physical analysis or diagrams, • Costs for employing experts for the advice, opinions, or testimony concerning claims under investigation or in litigation of for which a declaratory judgment is sought, • Costs for independent medical examination or evaluation for rehabilitation, • Costs of legal transcripts of testimony taken at coroner's inquests, or criminal or civil proceeding, • Costs for copies of any public records or medical records, • Costs of depositions and court reporting, • Costs and expenses of subrogation, (4f not George Hills), • Costs of engineers, handwriting experts, or any other type of expert used in the preparation of litigation or used in a one-time basis to resolve disputes • Witness fees and travel expenses, • Costs of photographers and photocopy services (if not George Hills—our costs for this is included in our rate) • Costs of appraisal fees and expenses not included in flat fee or performed by others, Claims Adjusting and Administration Services Between the City of Redlands and George Hills Company page 15 of 18 EXHIBIT B FEE SCHEDULE AND SERVICES F Compensation Schedule Contractor shall provide detailed cost information of services on a monthly and annual,or per file basis,and include all costs associated for the scope of work provided George Hills generally suggests using the time and expense fee structure found in the City's current contract for accounts of this scope and claims volume, as such a structure allows the client the flexibility of only paying for the service they receive in the event that they refer fewer claims than anticipated George Hills has provided fee options for the City to choose from Furthermore, as previously mentioned, George Hills proposes the use of a Claims Processor to be responsible for transmitting data from the City to SIMS, including all documents relating to claims, reserves and reserve changes,and all financial data Additionally, George Hills suggests utilizing the Claims Processor to input 100%of the City's claims into SIMS for the benefits of underwriting, auditing, and trend analysis This would also allow the City to eliminate any duplicative in-house processes for data entry Pricing Is based on 25 open active claims, and an average of 60-70 claims per year The below General Fee Section and Catastrophe Sections shall apply to applicable services provided during the first year of this contract Compensation for services provided during subsequent years may be re-negotiated annually Such than e, if any, shall be submitted to the client by June 30th of each year to witting General Fee Section Applies to All Options One Time Start Up Fee $1,500 Mileage IRS Rate Allocated Expenses At cost,as described Annual Administration Fee or $1,250 Annual Administration Fee with Check Writing $2,500 Annual Administration Fee with Check Writing is based on the assumption that the client will utilize George Hills'preferred bank of C4 Bank & Trust Should another bank be selected, an additional setup fee may be charged Conversion Fee To Be Determined If George Halls is retained for five years, then we will absorb 100%of this cost ff George Hills is not retained for the full length of the proposed contract, then 20%per year not retained shall be charged to the client The data conversion fee is dependent on many factors which will need to be discussed Catastrophe Pricing Applies George Hil is recognizes that in the event of a catastrophe,additional hours will need to be applied to the handling of a clann.As such in order to preserve the quality and efficiency of service for which we have been known,George Hills proposes that should a catastrophe occur,the following rates are applied to any claims resulting from that catastrophe and do not erode any established annual cap of service fees Claim Services At our standard hourly rate Mileage IRS rate Allocated Expenses At cost,as described Claims Adjusting and Administration Services Between the City of Redlands and George Hills Company page 16 of 18 Option I Time and Expense Claim Adjusting Services—including offxce%verhead expenses $85 per hour Claim Processing Services Capped at$64,000 Option ' III Open Claims Inventory $20,000 New Claims and Continual Annual Fee $49,000 per year New Claims and Continual Monthly Fee $4,083 per month Option 3 Per Clahn Discount Rate I"Year 5800 per claim first year Negotiated Rate 2"d Year E Overview and Approach Claims Adjusting and Administration Services Between the City of Redlands and George Hills Company page 17 of 18 Contractor shall itemize those services which are further required in the servicing of the account but are not noted in the aforementioned paragraphs as requirements and will entitle this section as Additional Services. ADDITIONAL SERVICES The following fees for value-add services and description of allocated services will be applied regardless of whether or not the City chooses Option 1 or Option 2 or Option 3. George Hills Value-Add Program Exnandcd Subroeatton Recovery for Public Entities Standard Subrogation Fee 30%of amount collected The minimum amount to be paid to George Hills will be$250 per settled claim.However George Hills has the authority to reject any claim for any reason,dismissing the client of any fiscal responsibility for refected claims only Generally, no recovery shall be agreed to involving payment plans if the recovery is less than$5 000 and/or Maier than one year term Exceptions can be made on a case by case basis.If a recovery is agreed to above this amount,subrogation fee shall be 45%.In the event a payment plan is authorized and entered into, the subrogation fee will be based upon the total amount of the lien and will be invoiced to the client. If authorized,small claims court appearances for recovery of funds $150 per appearance EPL Investigations $90 per hour Custom Reporting Beyond Average Scope of Design To be agreed upon by City and GH iMetricsrm Business Intelligence Reports with Executive In-Person Debriefs No charge "Lessons Learned"Round Tables for Public Entity Risk Management Teams No charge Claims Adjusting and Administration Services Between the City of Redlands and George Hills Company page 18 of 18