Protected Self Insurance

Insurance Cost Allocation

Allocating insurance Costs for policies purchased for the benefit of the entire University among Cornell Departments, Enterprises, and other cost responsibility centers is a major function of the Risk Management & Insurance Department. Costs are allocated based on risk exposure measured by building square feet, land areas, building replacement values, number of employees, content values, building types, content types, number of vehicles, vehicles types, and loss experience. The Cost Allocation Program is designed to conform to the guidelines of fairness, cost effectiveness, and departmental incentive laid down by the Insurance Cost Allocation Committee of the Controller’s Support Group. Departments are billed once a year for their portion of the Protected Self Insurance (PSI) program cost. Policies which are purchased directly for the benefit of one department are billed directly to that department, since the risk insured is not shared with any other Cornell Unit.

Departments should examine their invoices closely to make sure all Cornell assets which are entrusted to the department are included on their invoice. In the event of an accident, Departments may be held responsible for buildings and their contents if the department fails to insure the property through the PSI program. Logic should dictate that only if you inform the insurance company of your assets and pay a premium to protect those assets will the insurance company pay in the event of a loss. Likewise, the Department of Risk Management and Insurance should be informed of the disposal of property so the department can avoid the Insurance charges associated with the property.

PSI Property

Protects University buildings and contents against losses from major perils including: fire, earthquake, flood, lightning, windstorm, hail, smoke, riot, damage caused by vehicles or aircraft, sprinkler leakage, and vandalism  all subject to the terms of the policy.  After a self-insured retention, the University policies provide for replacement cost coverage up to the maximum coverage limits.

Both Endowed and Contract College Departments can purchases extended theft/breakage coverage for contents through the All-Risk Program.

Deductibles

University department’s normally will have a $500 deductible for losses in their areas which are covered by the University PSI Property Program. A higher deductible may be imposed (up to $10,000) if the loss is due to the negligence of the department in failing to maintain the assets which are entrusted to them.  Their is no deductible to departments for the University PSI Liability Program.