OAK BROOK, IL – Oak Brook is dropping its longtime insurer less than two months after the village approved $2 million in settlements with three women who claimed the former deputy police chief sexually harassed them.
The insurer, the Intergovernmental Risk Management Agency, covered the entire amount of the settlements.
On Tuesday, the Oak Brook Village Board authorized the village's withdrawal from the organization, which insures public bodies around the suburbs.
In a memo, Village Manager Greg Summers said that the insurer, under its current executive director, has increased the frequency with which it denies coverage.
Most recently, this resulted in the village having to sue the insurer and the executive director, Margo Ely, to enforce policy coverages, Summers said.
The new practice creates unnecessary spending and delays, as well as drives up exposure, he said.
The insurer's director and board, Summers said, has "tremendous latitude in deciding what is a covered claim and what is not. The end result is nearly $1 million in annual premiums with zero guarantee of coverage."
For the current year, the village's premium amounted to $925,000.
By switching to the Illinois Counties Risk Management Trust, Summers said the village could increase its coverage limit from $15 million to $21 million, while reducing its annual insurance costs.
Oak Brook was a founding member of the Intergovernmental Risk Management Agency in 1979.
On March 27, Village President Larry Herman and Police Chief Brian Brockis signed settlements with the three women.
The Village Board never voted on the agreements in an open meeting. That effectively kept the matter secret from the public until Patch reported on the settlements earlier this week.
The village president and village trustees have not returned messages for comment about the president's authority to sign the agreements without board approval.
The trustees are Michael Manzo, Melissa Martin, Suresh Reddy, Edward Tiesenga and Naveen Jain. Trustee Jim Nagle resigned Tuesday, citing increased obligations in his business.
Ely, the insurer's executive director, could not be reached for immediate comment Thursday.
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