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<br />If the statute limits our liability to $1,000,000 per occurrence, why would the city purchase <br />higher coverage limits than that? <br /> <br />There are several different reasons why cities should strongly consider carrying higher limits of <br />liability coverage. <br />/~'\ <br />if V The statutory tort limits either do not or may not apply to several types of claims. Some <br />'.../ <br />examples include: <br /> <br />. Claims under federal civil rights laws. These include Section 1983, the Americans with <br />Disabilities Act, etc. <br /> <br />. Claims for tort liability that the city has assumed by contract. This occurs when a city <br />agrees in a contract to defend and indemnify a private party. <br /> <br />. Claims for actions in another state. This might occur in border cities that have mutual <br />aid agreements with adjoining states, or when a city official attends a national conference <br />or goes to Washington to lobby, etc. <br /> <br />. Claims based on liquor sales. This mostly affects cities with municipal liquor stores, but <br />it could also arise in connection with beer sales at a fire relief association fund-raiser, for <br />example. <br /> <br />. Claims based on a "taking" theory. Suits challenging land use regulations frequently <br />include an "inverse condemnation" claim, alleging that the regulation amounts to a <br />"taking" of the property. <br /> <br />2. LMCIT's primary liability coverage has annual limits on coverage for a few specific <br />risks. The table on page 1 lists the liability risks to which aggregate coverage limits apply. <br />If the city has a loss or claim in one of these areas, there might not be enough limits <br />remaining to cover the city's full exposure if there is a second loss of the same sort during the <br />year. Excess liability coverage gives the city additional protection against this risk as well. <br /> <br />However there are a couple of important restrictions on how the excess coverage applies to <br />risks that are subject to aggregate limits: <br /> <br />. The excess coverage does not apply to four risks: lead and asbestos;failure to supply <br />utilities; mold; and "limited pollution" claims if either the pollutant release or the <br />damage is below ground or in a body of water; and <br /> <br />. The excess coverage does not automatically apply to liquor liability unless the city <br />specifically requests it. <br /> <br />3. The city may be required by contract to carry higher coverage limits. Occasionally, a <br />contract might include a requirement that the city carry more than $1,000,000 of coverage <br />limits. Carrying excess coverage is a way to meet these requirements. (There's also another <br /> <br />2 <br />