CCP 04-08-1996 - Laserfiche WebLink

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. 1 Waiving tlte statutory limits I .. There is another issue cities need to consider. Some cities may feel that the statutory limits are not high enough to provide adequate compensation for very serious injuries, or for multiple parties. That is, the city might in effect say "We want to have at least $1 million (or $.J million I or $5 million, etc.) of coverage available, so that if we injure someone he won't go uncompensated ifhis injuries really do exceed the statutory limits." LMCIT's standard excess liability coverage is structured so that the statutory liability limits I remain in effect for those claims to which they apply. However, LMClT also gives the city the option, for an additional premium, to waive the statutory liability limits to the extent of the city's I excess coverage limits. 1bis "waiver" option would make more funds available to an injured party on a claim where the statutory liability limits would otherwise limit the amoullMhe claimant could recover. I Buying higher liability coverage limits gives the city better protection against the risks it faces. It's important to understand, though, that buying the more expensive "waiver" option doesn't give I the city any better protection than tlle "non-waiver" option provides; ratller, it gives the person the city injures better protection by allowing him to recover more than he would otherwise be able to from the city. I There's no simple "right" answer to the question of whether your city should buy excess liability .. coverage limits, and if so whether to do so under the "waiver" or the "non-waiver" option. These are discretionary decisions that only the council can decide. The council must determine whether the added protections (for the city and for the party the city might injure, respectively) are worth I that additional expenditure of city funds. Wfzat does tlte city need to do? I Every city should periodically review the question of whether to carry excess liability limits, and I if so whether to waive the statutory liability limits. LMCIT quotes for excess coverage show the premiums for both options. The decision to waive or not to waive tlle statutory limits must be made by motion or resolution of the city council. A form to show the council's choice is I enclosed with each quotc. That form must be completed and returned to LMClT. If the city indicates that it wishes to waive the liability limits, LMCIT issues a special endorsement as part of the coverage document showing that the statutory liability limits are waived to the extent of I the coverage purchased. PST - 11ll/95 I . I .. I