7.1. SR 10-20-2008 - Laserfiche WebLink

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3. The city may be required by contract to carry higher coverage limits. Occasionally, a contract might include a requirement that the city carry more than $1,200,000 of coverage limits. Carrying excess coverage is a way to meet these requirements. (There's also another option for cities in this situation. LMCIT can issue an endorsement to increase the city's coverage limit only for claims relating to that particular contract. There's a small charge for these "laser" endorsements.) 4. There may be more than one political subdivision covered under the city's coverage. An H}ZA, EDA, or port authority is itself a separate political subdivision. If the city EDA, for example, is named as a covered party on the city's coverage and a claim were made that involved both the city and the EDA, theoretically the claimant might be able to recover up to $1,200,000 from the city and another $1,200,000 from the EDA, since there are two political subdivisions involved.. Excess coverage is one way to provide enough coverage limits to address this situation. Another solution is for the H1ZA, EDA, or port authority to carry separate liability coverage in its own name. This issue of multiple covered parties can also arise is if the city has agreed by contract to name another entity as a covered party, or to defend and indemnify another entity. 5. Cities sometimes choose to carry higher coverage limits because of a concern that the courts might overturn the statutory liability limits. However, those limits have now been tested and upheld several times in Minnesota. While it's always possible that a future court might decide to throw out the statutory limits, this is now less of a concern. What excess liability coverage limits are available? Excess coverage is available in $1 million increments, up to a maximum of $5 million. Does the optional excess coverage apply to all types of claims? No. The excess liability coverage does not apply to the following types of claims: limited pollution, mold, failure to supply utilities, auto no-fault, uninsured /underinsured motorist, workers compensation, disability, or unemployment claims, or claims under the medical payments coverage. We're just a small city. Isn't excess liability coverage really just something that big cities might need? Absolutely not. If anything, excess liability coverage is even more important to a small city. If a city ends up with more liability than it has coverage, the city will have to either draw on existing funds or go to its taxpayers to pay that judgment. A large city faced with, say, a million dollars of liability over and above what its LMCIT coverage pays might be able to spread that $1 million cost over several thousand taxpayers. The small city by contrast might be dividing that same $1 million cost among only a couple hundred taxpayers. $1 million divided among 5000 taxpayers is $200