Insurance Broker Renewal

1. CITY OF ALAMO HEIGHTS
ADMINISTRATIVE DEPARTMENT
CITY COUNCIL AGENDA MEMORANDUM
TO: Mayor and City Council
FROM: Lori Harris, Human Resource Manager
SUBJECT: Insurance Broker Contract Renewal
DATE: December 14, 2020
SUMMARY
Discussion and possible action regarding the renewal of Catto and Catto as the city’s insurance
broker to include a 2% increase in their annual fee.
BACKGROUND INFORMATION
In 2016, Financial Benefit Services (FBS) in partnership with Catto and Catto became the
Insurance Brokers for the City’s employee insurance benefits. In 2018, Catto and Catto became
the sole broker and the fees remained at the initial $26,500 per year. Catto and Catto is asking
for a 2% increase in their annual fees for a total of $27,030.
POLICY ANALYSIS
Catto and Catto have consistently provided quality insurance broker services to the city since
2016.
FISCAL IMPACT
Increase in insurance brokerage fees by $530 per year.
ATTACHMENT
Attachment A – Updated Broker Services agreement 2% increase
______________________
Lori Harris
Human Resource Manager
______________________
Buddy Kuhn
City Manager

2. EMPLOYEE BENEFITS BROKER SERVICES AGREEMENT
BETWEEN CITY OF ALAMO HEIGHTS AND
CATTO & CATTO BENEFITS GROUP, LLP
AGREEMENT
This Agreement is entered into by and between Catto & Catto Benefits Group, LLP, of 106 S. St. Mary’s, Suite
800, San Antonio, Texas 78205 hereinafter referred to as “CCBG,” and City of Alamo Heights of 6116 Broadway,
San Antonio, Tx 78209.
PERFORMANCE STANDARD
The parties acknowledge that City of Alamo Heights, by retaining CCBG, is relying on the expertise of CCBG to
perform the services as specified below. CCBG shall perform its duties pursuant to this Agreement in
accordance with directions and instructions from City of Alamo Heights. CCBG shall act with the highest
professional standards and within applicable law, always acting honestly, in good faith, and in the best interest
of City of Alamo Heights. CCBG shall exercise the degree of care, diligence and skill of a prudent and
experienced insurance broker and consultant.
SERVICES
 Plan Design Consultation
 Assist with the development of employee benefit plan goals and strategies including benefit design,
cost, employee/employer contributions, communications, and funding.
 Provideanalysis of existing plans, offer new solutions,including alternative fundingarrangements,and
provide cost estimates and supporting recommendations.
 Provide information on benefit trends and industry best practices.
 Provide information on new benefit developments and options.
 Assist in the implementation of new programs or changes to existing programs.
 Marketing & Renewal
 Work with City of Alamo Heights to develop objectives and plan designs to include in Requests for
Proposals (RFP).
 Prepare detailed specifications for Requests for Proposals and submit to insurance markets/vendors.
 Review each proposal. Use CCBG’s influence in the marketplace to leverage and negotiate rates and
conditions favorable to and in accordance with City of Alamo Heights specifications.
 Prepare an evaluation of the proposals to simplify the comparative differences and important
components of the proposals. Evaluation will include recommendations concerning such proposals.
 Evaluate renewals proposed by insurance companies. Negotiate rates with companies after
analyzing current experience, retention, previous years’ financial results and the marketplace.
 Plan costs –current plan costs of all benefits compared to prior years’ costs.
 Analyze costs including premium, claims, and reserve levels; expenses, pooling levels, margins, and
overall effectiveness of funding arrangement.
 Communications Support
 Assist with preparation of open enrollment communication materials.
 Coordinate insurance company and service partner participants for City of Alamo Heights.
 Preparation and printing of benefit guides and enrollment forms for the employees.
 Prepare presentations for open enrollment, or other meetings as requested.
 Conduct open enrollment meetings at locations agreed upon by City of Alamo Heights and CCBG.
 Provide online employee communication website if desired.
 Administration
 Provide a dedicated service team that will be available and responsive to City of Alamo Heights
Human Resources staff on a timely basis.
 Provide assistance with claims questions and appeals.
 Organize meetings or conference calls, at minimum on a semi-annual basis, to review financial
experience, benefit trends, claims and administrative issues, proposed and enacted legislation, and
benefit trends.
 Notify carriers of any benefit or administrative changes.
Attachment A

3.  Monitor benefit plan insurance carriers, claims administrators and other service partners/providers
to ensure smooth administration.
 Review contracts, plan documents, insurance policies and other documents for applicability,
accuracy and consistency.
 Regulatory Compliance
 Legislative Notification and Consultation – keep City of Alamo Heights abreast of proposed and
enacted legislation and regulations through newsletters and ongoing communication. Determine
implications of enacted legislation and recommend benefit or funding revisions when appropriate.
COMPENSATION
CCBG will be compensated $27,030 annually, paid monthly.
If City of Alamo Heights acquires additional companies which results in a significant increase in the number of
locations or in the number of employees covered under the City of Alamo Heights benefits plans, the
compensation may be adjusted, as mutually agreed upon, to reflect a change in the level of work or services
performed or funded by CCBG.
Additional compensation may be required for services provided outside of the scope of this Agreement, as
agreed to by both parties in advance of the work being performed.
Note: Supplemental Income
Many insurance companies and health plans have supplemental income plans, which pay special compensation to
brokers. These arrangements are typically based on the volume of the broker’s entire block of business with a
given insurance company or health plan. Payments are not tied to specific clients and are not guaranteed. Catto &
Catto’s recommendations regarding health plans and insurance companies are exclusively based on benefit levels,
provider networks, service capabilities, the financial strength of companies, and the lowest immediate and long
term cost for our clients. The amount of any potential supplemental income is not considered when making
recommendations. In addition, CCBG clients always make the final decisions regarding the selection of a health
plan or insurance company. Supplemental income is not included in the compensation specified above.
TERMINATION
Both parties may terminate this Agreement upon thirty days (30) written notice to the other. In the event of
such termination by City of Alamo Heights, CCBG shall be paid for professional services rendered up to the date
of such termination. City of Alamo Heights right to terminate under this paragraph shall be in addition to any
other rights reserved to City of Alamo Heights under this Agreement. Said termination by either party shall not
be deemed to be a breach of this Agreement and/or tortious conduct.
INDEPENDENT CONTRACTOR
While in the performance of this Agreement, CCBG is an independent contractor and not an officer, agent, or
employee of the City of Alamo Heights.
ACCEPTANCE
By: City of Alamo Heights
___________________________________________ ______________
Buddy Kuhn Date
City Manager
By: Catto & Catto Benefits Group, LLP
___________________________________________ ______________
Ben Halbach Date
Partner & Account Executive
Attachment A