The State owns approximately 5,470 buildings and structures valued at more than $255,000,000; the contents are valued at more than $57,000,000. The value of the buildings and contents increases yearly due to new construction. These buildings are of different construction, having been erected over many years. Those buildings of recent construction are fire resistant, earlier ones are less so. The total average annual premium on buildings and their contents amounts to $286,557.

With this investment in structures and contents and the prospect of additions thereto, the General Assembly, at its 1960 session, directed that a study be made to investigate the possibility of effecting economies in the outlay on insurance premiums without impairing the protection presently afforded State properties. House Joint Resolution No. 93 directs the Virginia Advisory Legislative Council to make this study.

The Council assigned this study to C. W. Cleaton, a member of the Council and of the House of Delegates to serve as Chairman of the Committee to make the preliminary investigation and report. The following were selected to serve with Mr. Gleaton on the Committee: James G. Baldwin, Richmond; Herbert H. Goodman, Remmington Rand Division of Sperry Rand Corporation, Arlington; C. R. Hoggard, Jr., Superintendent of Insurance, Seaboard Airline Railroad Company, Richmond; George H. Hill, Member of the House of Delegates, Newport News; Charles K. Hutchens, Member of the House of Delegates, Newport News; C. Harrison Mann, Jr., Member of the House of Delegates, Arlington; and Harold H. Purcell, Member of the State Senate, Louisa. Senator Purcell was elected Vice-Chairman of the Committee; John B. Boatwright, Jr. and Fletcher W. Harkrader, Jr., served as Secretary and Recording Secretary, respectively.

The Bureau of Property Records and Insurance of the Division of the Budget compiled material on the insurance coverage and value of present State properties. Information was gathered concerning the insurance practices of other states. A study was made of the insurance practices of certain large businesses. The Bureau of Property Records and Insurance, working with the Bureau of Insurance, compiled information on the savings which might be made through the utilization of various insurance plans. In order to get first hand information concerning the manner in which insurance is handled by the various institutions and agencies of the State, representatives from several institutions and agencies were invited to meet with the group and discuss their insurance practices. On July 25, 1961, a public hearing was conducted in Richmond.

The reports of the Bureau of Property Records and Insurance of the Division of the Budget showing value of insurance coverage and other data as to present State properties dated June 30, 1960; and the report on savings which could be effected over amounts now paid for insurance premiums for fire and/or extended coverage prepared by the Bureau of Property Records and Insurance in cooperation with the Bureau of Insurance, dated December 1, 1961, are attached as Appendices A and B, respectively.

The Committee concluded its deliberations and made its report to the Council. The Council has carefully reviewed the report of the Committee, and has reached the conclusions and offers the recommendations set out in the report.