S.A.M. 0504 Insurance and Self-Insurance

Reporting Losses

Agencies must immediately report all losses and take prompt action to protect the property from further damage or loss. In the event of a loss estimated to exceed $25,000, agencies must contact Risk Management within 48 hours. Risk Management will contact the State’s property insurer, who will dispatch a claims adjuster to the scene. Damaged property must be retained and all evidence related to the loss preserved until inspected by an adjuster. Property losses must be reported using the Property Loss/Damage Report form available found below; If the loss involves vandalism, theft, or other criminal activity, a copy of the police crime report must also be forwarded to Risk Management. Losses reported later than 90 days from the date of loss may not be covered. Losses that result from mysterious disappearance (no signs of forced entry or losses found during inventory) or resulting from known risks that have not been corrected may not be covered. Contested claims compensability determinations can be referred to the Risk Manager for review. The decision of the Risk Manager will be final and binding.

    Making Repairs

    Agencies are responsible to affect the repair or replacement process by contacting the appropriate parties as soon as possible. These contacts might include Buildings & Grounds Division maintenance staff, State Purchasing Division, State Public Works Board, State Budget Office or outside contractors or vendors (following Purchasing and State Public Works Board requirements). Construction to repair or replace a major structural loss (in excess of $100,000) must be initiated within two years from the date of loss unless a written waiver is obtained from the Risk Manager.

      Paying for a Loss

      Agencies are responsible for a $1,500 per occurrence deductible or an alternate deductible identified by the Risk Manager. Risk Management will pay the lesser amount of the repair or replacement, excluding any betterment and subject to the exclusions contained in the commercial excess property insurance policy.

        1.  When an agency pays for the entire loss out of its budget, Risk Management will reimburse it, less the deductible, after receiving proof of repair/replacement and evidence that the invoices have been paid by the agency (e.g. copies of competitive bids, copies of paid invoices, Vouchers Payable and "3.0" Report, or canceled check).

        2. Risk Management can directly pay a repair/replacement vendor. In order to do this, it is necessary that Risk Management be forwarded a copy of related contracts or the original invoice and copies of all estimates, written documentation from the agency that the work has been completed in an acceptable fashion and the agency has paid Risk Management the appropriate deductible. However, it is the responsibility of the agency to complete all necessary paperwork required to effect the repair or replacement of the damaged or destroyed items. This would include any contracts, purchase requisitions, etc. Risk Management can be identified as the contracting agency if the contract is reviewed and approved by the Risk Manager. In the case of purchase requisitions, agencies should complete the form, except for the budget coding sections and the authorization signature and forward to Risk Management for completion.

        3. Repairs or replacement for significant structural property losses (exceeding $25,000) must be coordinated with the Risk Management Division and the State Public Works Board, unless a specific waiver is approved by the Risk Manager.

          State employees’ personal property kept or maintained on State property will be considered to be “at their own risk” and to be covered by their own personal insurance.


              Crystal Cruson
              Program Officer
              (775) 687-1752