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Gone, with the wind

City officials decide after dropping wind insurance that other insurance cuts are okay, too.

Published October 1, 2006

LARGO - First, city commissioners decided to ditch their wind insurance, essentially leaving $205.6-million worth of city facilities without hurricane coverage.

Then, at a special city meeting Friday evening, commissioners decided to cut insurance more.

The city will pay $153,767 this year to cover a maximum of $25-million worth of damage for any one instance of fire, explosion, riot, theft or other peril.

Last year, the city paid $404,730 for property insurance, including wind coverage, with a $140-million maximum payout per single event. This year they were faced with a premium of nearly $2-million for similar coverage.

The city's plan now includes beefing up reserve funds to self-insure city facilities, relying on federal aid in the event that city facilities are damaged in a declared disaster and, as a last resort, going into debt.

Without the wind coverage, city leaders said it didn't make sense to pay more for other property insurance.

Human Resources Director Susan Sinz said the city wasn't likely to be exposed to a single event loss greater than $25-million.

Mayor Pat Gerard agreed, saying there would have to be a cataclysmic event to do more than that amount of damage.

Largo's choice to drop wind coverage is virtually unheard of.

Mike Madden, director of public risk services for the Florida League of Cities, said he knew of no other large cities that have dropped insurance for wind damage entirely.

"We haven't heard of any that have decided to go that route," Madden said.

But Largo's decision to cut back on other insurance is not nearly so unusual. A number of cities have decreased their coverage or decided to go without coverage for certain structures.

[Last modified September 30, 2006, 22:12:16]

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