HomeMy WebLinkAboutItem 11 - Stop Loss InsuranceMEMO TO: HONORABLE MAYOR AND MEMBERS OF THE CITY COUNCIL
FROM: BRUNO RUMBELOW, CITY MANAGER
MEETING DATE: SEPTEMBER 15, 2026
SUBJECT: ANNUAL POLICY FOR MEDICAL AND RX STOP LOSS INSURANCE
RECOMMENDATION: City Council to consider approval for an annual policy for medical and RX
stop loss insurance from HCC Life Insurance Company.
FUNDING SOURCE: Funds are available in the General Fund, Utility Enterprise Fund, Lake
Enterprise Fund, Storm Drainage Fund, Crime Control and Prevention
District Fund, Lake Parks Fund, Economic Development Fund, CVB, and
Shuttle Services Fund in the estimated amount of $2,330,250.
BACKGROUND: The City of Grapevine is self -funded for employee and pre-65 retiree
medical and prescription insurance. Therefore, the City assumes all, or a
portion of, the risk for medical and prescription drug claims for all covered
members on its health plan. Stop Loss Insurance is designed to offer
effective protection against excessive claims by limiting the amount of risk
on any one individual.
Due to high cost of prescription claims this year, the City's insurance
consultant, Lockton Dunning, secured a proposal from three vendors. City
staff determined the incumbent, HCC, is the best option with a rate
increase of 50%. HCC will renew without an increase in liability for current
high claimants. Seven other vendors declined to quote due to the ongoing
risk.