HomeMy WebLinkAbout4.F.3. Monetary Limits on Tort Liability League of Minnesota Cities Insurance Trust (LMCIT) Property and Liability Ins. Renewal Consent Business 4. F. 3.
SE...{AKOJ'EE
TO: Mayor and City Council
Mark McNeill, City Administrator
FROM: Julie Linnihan, Finance Director/City Clerk
DATE: 06/17/2014
SUBJECT: Monetary Limits on Tort Liability for League of Minnesota Cities Insurance
Trust(LMCIT)Property and Liability Insurance Renewal (F)
Action Sought
City staff is currently preparing the information for the 2014-2015 renewals. A waiver document
will be submitted with the annual application, so as to obtain the premium determination.
If the City does not waive the statutory tort limits, an individual claimant would be limited to no
more than $500,000 for a single claim to which the statutory tort limits apply. The total for which
all claimants would be able to recover for a single occurrence would be limited to $1,500,000. If
the City waives the statutory tort limits, and does not purchase excess liability coverage, a single
claimant could potentially recover up to $1,500,000 for a single occurrence. If the City waives the
statutory tort limitations and purchases excess liability coverage, a single claimant could
potentially recover an amount up to the limit of the coverage purchased.
Council has historically not waived the monetary limits on tort liability, which means a liability
limit of$500,000 maximum for a single claimant, and a$1,500,000 maximum for all claimants
for a single occurrence.
Budget Impact:
If the Council chooses not to waive coverage, there is no financial impact. Conversely, if it does
waive coverage limits, there would be an additional (undetermined) cost for increased insurance
premiums.
Recommendation:
Staff recommends the City not waive the monetary limits on tort liability, as established by
Minnesota Statute 466.04.
Action Required:
If the Council concurs, it should, by motion, not waive the monetary limits on the tort liability
coverage for the upcoming League of Minnesota Cities Insurance Trust(LMCIT)property and
liability insurance renewal.
Attachments: Tort Liability
SECTION 1:LIABILITY COVERAGE WAIVER FORM
Cities obtaining liability coverage from the League of Minnesota Cities Insurance Trust must decide
whether or not to waive the statutory tort liability limits to the extent of the coverage purchased. The
decision to waive or not to waive the statutory limits has the following effects:
If the city does not waive the statutory tort limits, an individual claimant would be able to recover no
more than$500,000.on any claim to which the statutory tort limits apply. The total which all claimants
would be able to recover for a single occurrence to which the statutory tort limits apply would be
limited to$1,500,000. These statutory tort limits would apply regardless of whether or not the city
purchases the optional excess liability coverage.
If the city waives the statutory tort limits and does not purchase excess liability coverage,a single
claimant could potentially recover up to$1,500,000.on a single occurrence. The total which all
claimants would be able to recover for a single occurrence to which the statutory tort limits apply would
also be limited to$1,500,000.,regardless of the number of claimants.
if the city waives the statutory tort limits and purchases excess liability coverage,a single claimant
could potentially recover an amount up to the limit of the coverage purchased. The total which all
claimants would be able to recover for a single occurrence to which the statutory tort limits apply would
also be limited to the amount of coverage purchased, regardless of the number of claimants.
Claims to which the statutory municipal tort limits do not apply are not affected by this decision.
This decision must be made by the city council. Cities purchasing coverage must complete and
return this form to LMCIT before the effective date of the coverage, For further information, contact
LMCIT. You may also wish to discuss these issues with your city attorney.
accepts liability coverage limits of$ from the League of
Minnesota Cities Insurance Trust(LMCIT).
Check one:
E The city DOES NOT WAIVE the monetary limits on municipal tort liability established by
Minnesota Statutes 466.04.
❑ The city WAIVES the monetary limits on tort liability established by Minnesota Statutes 466.04,
to the extent of the limits of the liability coverage obtained from LMCIT.
Date of city council meeting
Signature Position
Return this completed form to LMCIT, 145 University Ave. W., St. Paul, MN. 55103-2049