1999-02-24 - Laserfiche WebLink

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The LMCIT Board decided to restructure the liability coverage in this way for two reasons: First, it lets a city to take advantage of all of the defenses and protections that the legislature has provided. Second, the projected savings from being able to apply the $300,000 per claimant statutory limit will roughly offset the projected increased cost for the higher per - occurrence limit. The city's option to waive the statutory limits The statutory liability limit only comes into play if somebody has been injured by the city's negligence, and has proved to the court that his/her actual injuries exceed $300,000. The statutory liability limit means, very literally, that the city and LMCIT won't fully compensate that individual for his/her injuries which the city caused. Because of this, some cities may decide that as a matter of public policy you want to have more than $300,000 available to compensate a citizen who has been injured by the city's negligence. For this reason, LMCIT gives the city the option to waive the statutory liability limit if the city wishes to do so. By waiving the statutory limit, the city makes it possible for a claimant to recover up to the full limit of the city's LMCIT liability coverage. Since it increases the exposure, there is an additional premium charge of 3.5% if the city decides to waive the statutory per - person limit. If a city decides to waive the statutory liability limit and doesn't carry the optional excess liability coverage, the city's coverage would essentially be identical to the current coverage but with a higher per - occurrence limit. For cities that carry the optional excess Liability coverage, the waiver also applies to that coverage. The decision to waive or not to waive the statutory liability limits must be made by the city council. The package of renewal materials includes a form that must be completed and returned to LMCIT to document the council's decision on whether or not to waive the statutory limits. Here's a shorthand summary of the practical effects of that decision: • If the city does not waive the statutory tort limits, an individual claimant would be able to recover no more than $300,000 on any claim to which the statutory tort limits apply. The total which all claimants would be able to recover for a single occurrence to which the statutory tort limits apply would be limited to $750,000. These statutory tort limits would apply regardless of whether or not the city purchases the optional excess liability coverage. • If the city waives the statutory tort limits and does not purchase excess liability coverage, a single claimant could potentially recover up to $750,000 on a single occurrence on a claim to which the statutory limits apply. The total which all claimants would be able to recover for a single occurrence to which the statutory tort limits apply would be limited to $750,000, regardless of the number of claimants.