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<br />citizens for injuries caused by the city's negligence. Waiving the statutory liability limits is a <br />way to do that. <br /> <br />Other cities may feel that the appropriate policy is to minimize the expenditure of the taxpayers' <br />funds by taking full advantage of every protection the legislature has decided to provide. There's <br />no right or wrong answer on this point. It's a discretionary question of city policy that each city <br />cOllncilneeds to decide for itself. <br /> <br />How would the waiver affect our cit)"s coverage or risk on tbose claims tbat the statutory <br />tort liability limits don't apply to'? <br /> <br />It doesn't. Waiving the statutory tort limits has no effect on claims that the statutory limits don't <br />apply to. <br /> <br />What's the effect of waiving the statutory limits if we have excess coverage'! <br /> <br />If the city has $1 million of excess coverage and chooses to waive the statutory tort limits, the <br />claimants (whether it's one claimant or several) could then potentially recover up to 52 million in <br />damages in a single occurrence. If the city carries higher excess coverage limits, the potential <br />maximum recovery per occurrence is correspondingly higher. <br /> <br />Carrying excess coverage under the waiver option is a way to address an issue that some cities <br />tind troubling: the case where many people are injured in a single occurrence caused by city <br />negligence. Suppose. for example, that a city vehicle negligently runs into a school bus full of <br />kids. causing multiple serious injUlies. $1,000.000 divided 50 ways may not go far toward <br />compensating for those injuries. Excess coverage under the waiver option makes more funds <br />available to compensate the victims in that kind of situation. <br /> <br />The cost of the excess liability coverage is about 25% greater if the city waives the statutory tort <br />limits. The cost difference is proportionally greater than the cost difference at the primary level <br />because for a city that carries excess coverage, waiving the statutory tort limits increases both the <br />per-claimant exposure and the per-occurrence exposure. <br /> <br />If we waive the statutory tort liability limits, does it increase the risk that the city will end <br />lip with liability that LMCIT docsn't cover'? <br /> <br />No. The waiver foml specifically says that the city is waiving the statutory tort liability limits <br />only to the extent of the city's coverage. <br /> <br />Of course, that's not to say that there is no risk that the city's liability could exceed its coverage <br />limits. We listed earlier a number of ways that could happen to any city. But the waiver doesn't <br />increase that risk. <br /> <br />5 <br />