5.3. SR 01-09-2006 - Laserfiche WebLink

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LMC League of Minnesota Cities Insurance Trust 145 University Avenue West, St Paul, MN 55103-2044 (651) 281.1200 . (800) 925-1122 Fax: (651) 281.1298 . TOO: (651) 281-1290 wWw.lmnc.org L-gue 0/ Minnt180la Cin... Ci/iu promoting ~'" RISK MANAGEMENT INFORMATION LMCIT LIABILITY COVERAGE OPTIONS Liability Limits, Coverage Limits, and Waivers LMCIT gives cities several options for structuring their liability coverage. The city can choose either to waive or not to waive the monetary limits that the statutes provide; and the city can select from among several liability coverage limits. This memo discusses these options and identifies some issues to consider in deciding which of the options best meets the city's needs. What are the statutory limits on municipal tort liability? The statutes limit a city's tort liability to a maximum of $300,000 per claimant and $1,000,000 per occurrence. These limits apply whether the claim is against the city, against the individual officer or employee, or against both. What are the coverage limits for LMCIT's basic primary liability coverage? LMCIT's liability coverage provides a limit of $1 ,000,000 per occurrence, matching the per- occurrence part of the statutory municipal tort liability limit. Under the basic coverage form the $300,000 per claimant part of the statutory liability limit is not waived, so ifthe statutory limit applies to the particular claim, LMCIT and the city would be able to use that limit as a defense. Beside the overall coverage limit of $1,000,000 per occurrence, there are also annual aggregate limits (that is, limits on the total amount of coverage for the year regardless of the number of claims), for certain specific risks. Aggregate limits apply to the following: $1,000,000 annuall $1,000,000 annuall $1,500,000 annuall $1,000,000 annuall $200,000 annuall $1,500,000 annuall $1,000,000 annuall $1,000,000 annuall * The limit applies to both damages and defense costs. ** Coverage is on a sliding scale percentage basis, and applies to both damages and litigation costs.