Fountain Valley : City Status in Insurance Cooperative Is in Doubt

Although the city was accepted last week by an executive committee as a member of a Los Angeles County-based insurance cooperative, the city may not get full coverage from the group’s carrier, according to Assistant City Manager Ray Kromer.

If Transcontinental Insurance Co. does not agree to write a separate policy for the city, then it would receive only $500,000 worth of liability coverage instead of being insured for $10.5 million, Kromer said.

He said Transcontinental is considering whether to take on yet another city as a liability insurance client.

If not fully insured, the city would pay less than the $150,000 price quoted to Kromer for membership in the cooperative, he said.

The city applied to join the group after its present insurance carrier wanted to double its premium to about $212,000 and drop the amount of coverage from $10 million to $5 million.