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<br />December 1, 2011
<br />City of San Leandro
<br />Civic Center
<br />835 East 14 Street
<br />San Leandro, California 94577
<br />Attn: Ms. Mary Ann Perini
<br />Budget & Compliance Manager /Risk Management
<br />RE: Retention Analysis and Financial Benchmark
<br />For the General Liability Program
<br />Using Data Valued as of June 30, 2011
<br />299091
<br />The City of San Leandro (the City) currently maintains a $1 million per occurrence self -
<br />insured retention (SIR) and participates in the CJPRMA pool above the $1 million limit.
<br />The City has asked us to (1) evaluate if there is a benefit in lowering the SIR limit, and (2)
<br />provide some financial benchmarks to evaluate its fund balance.
<br />(1) Evaluation of the Alternative SIRs
<br />We have estimated the projected losses for 2012/13 at the $1 million SIR limit in our
<br />actuarial report dated August 24, 2011. We have projected the 2012/13 losses at various
<br />alternative SIRs and confidence levels as shown in Table 1.
<br />Table 1
<br />Projected Ultimate Limited Losses
<br />at Various SIRs and Confidence Levels
<br />2012/13
<br />Note: (C) is from the actuarial report as of 6/30/11 dated August 24, 2011
<br />1901 Main Street, Suite 300 (A), (B), (D), (E) are based on (C) and actuarial judgment.
<br />Irvine, CA 92614
<br />tel: 949.608.6300 • fax: 949.608.6475 • www.aon.com
<br />Aon Risk Solutions I Global Risk Consulting ; Actuarial and Analytics
<br />1
<br />R U
<br />NO
<br />K T`11
<br />(A) $500,000
<br />$992,800
<br />$1,231,072
<br />$1,499,128
<br />$1,985,600
<br />(B) $750,000
<br />1,086,240
<br />1,346,938
<br />1,640,222
<br />2,172,480
<br />Op
<br />(D) $1,500,000
<br />1,284,800
<br />1,593,152
<br />1,940,048
<br />2,569,600
<br />(E) $2,000,000
<br />1,366,560
<br />1,694,534
<br />2,063,506
<br />2,733,120
<br />Note: (C) is from the actuarial report as of 6/30/11 dated August 24, 2011
<br />1901 Main Street, Suite 300 (A), (B), (D), (E) are based on (C) and actuarial judgment.
<br />Irvine, CA 92614
<br />tel: 949.608.6300 • fax: 949.608.6475 • www.aon.com
<br />Aon Risk Solutions I Global Risk Consulting ; Actuarial and Analytics
<br />1
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