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In situations that involve a pure mutual aid agreement or other type of <br /> agreement that does not create a joint powers entity, the city does not need to <br /> take any special action in order to have coverage for liability claims arising <br /> out of activities under these kinds of agreements. The city's LMCIT liability <br /> coverage will cover claims arising from activities pursuant to that agreement. <br /> 2. Obtaining coverage <br /> There are two ways in which LMCIT can provide coverage for a joint powers <br /> entity and its members. <br /> • The usual practice is for LMCIT to issue a separate liability coverage <br /> document to the joint powers entity. This coverage document includes as <br /> covered parties the entity itself; its officers and employees; the political <br /> subdivisions who are members of the joint powers entity; and the officers <br /> and employees of those political subdivisions. The idea is to get all of the <br /> liability coverage for the entity's activities in one place, so that everyone <br /> who might be sued as a result of the entity's activities is covered in the <br /> same place. <br /> • The second less common option is to add the coverage for the joint entity <br /> to one of the individual city's coverages. This might make sense, for <br /> example, if the relationship between the member cities is such that one <br /> city is in a position to effectively control the joint entity's activities and <br /> decision-making. If the member cities prefer, LMCIT can provide the <br /> coverage this way,by naming the joint powers entity as a covered party on <br /> one of the constituent city's policies. <br /> It is important to understand that if the joint powers entity formed by City A <br /> and City B is named as a covered party on City A's coverage, City B and City <br /> B's officers and employees also become covered parties under City A's <br /> coverage, assuming that the act or omission giving rise to the claim is related <br /> to the joint powers agreement. In addition, City A's insurance will provide <br /> coverage for the joint entity itself and its board members and employees. <br /> Thus, any claims will affect City A's experience, deductibles, and ultimately, <br /> its premium. <br /> It would not make sense to add the joint entity to both member cities' <br /> coverages. That would result in duplicate coverage and create the potential for <br /> the kind of conflicts among defendants that members of a joint powers entity <br /> should try to avoid. <br /> 76 <br />