Property insurance with broad form all risk coverage (including earthquake and flood) is provided on a replacement cost basis covering all state owned or leased real property (buildings and its equipment ) and personal property (business equipment and office contents including State Museum fine arts), as well as all owned and non-owned aircraft, watercraft (Alaska Marine Highway System ferries and other agency vessels), and a schedule of large highway bridges.
Casualty coverage protects each state agency and their personnel from third party civil (tort) liability claims alleged to have arisen from combined liability; general (premises/operations), automobile, professional (errors and omissions), medical malpractice, aviation (aircraft and airport) or marine (crew and passenger injuries).
Specialty coverages-blanket public employee faithful performance and custom bonding, accidental death and disability (including medical expenses) for volunteers, computer and telephone fraud and foreign liability, etc. The State's excess insurance programs continually evolve, responding to new State activities, policy form offerings and current condition in world reinsurance markets.
The state is completely self-insured on all statutory workers, compensation claims and the state is self insuring all of its comprehensive casualty exposures; general liability (premises and operations), professional liability (medical and legal malpractice) and automobile liability. The following policies have Self-Insured Retention (SIR) levels. SIR's are the funds Risk Management contributes to a claim prior to excess policies taking effect, $1 million per claim for property, $750,000 for marine risks; and $250,000 per incident for airport and aircraft liability exposures. Policy limits of excess insurance vary by risk; $500 million for marine; $200 million for property and $500 million for airport. The following exhibit provides a brief overview of the excess insurance program.
Many diverse domestic and international insurance companies and various Lloyd's of London underwriting syndicates and companies participate in the State of Alaska's excess insurance program. In renewal of its excess insurance program the State may participate as a small percentage co-insurer in the upper underwriting layers in order to limit premium expenditures.
Marketing of the State's insurance program is provided by Arthur J. Gallagher Risk Management Services, one of the independent brokers in the world market. The State obtained the independent actuarial assessment of the state insurance program required by AS 37.05.287 (b) from Madison Consulting Group. Specialty computer software programs were supported by Origami Risk LLC. All Risk Management professional service contracts are solicited through formal request for proposals issued every five years.