The Gainesville City Council unanimously approved a $551,000 contract with OneBeacon Government Risks for property and liability insurance coverage at a special called meeting Thursday morning.
The insurance coverage includes the operation of the Gainesville Connection public transit service.
BB&T Insurance Services canvassed for bids on behalf of the city and recommended OneBeacon.
Two other companies submitted bids.
Trident Insurance quoted a price for coverage at $603,000 while Travelers Public Sector offered coverage for $811,000.
The contract is good for one year, ending on July 1, 2015.
OneBeacon has guaranteed that it will not raise rates more than 3 percent annually over three years if the city agrees to renew the contract.