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SEP-25-2003 16 27 ACORDIA <br />9528307355 P.04 <br />. g <br />is <br />` >s the statute liatits oar liability to SI,000,000 per occurrence, why would the city purchase <br />higher coverage limits than that? <br />There ace several di w 'es <br />fferent ceasoas by cad should strongly consider carrying higher lmnrts of <br />liability coverage. <br />1. The statutory tart limits either da not ar may not apply to several types of claims. <br />Same examples inchrde: <br />• Claims under federal civil rights laws. These include Section 1583, the Americans with <br />Disabilities Act, etc. <br />- Claims for tart liability that the city has assumed by contract. This occurs when a city <br />agrees in a contract to defend and indemnify a privattr party. <br />• Claims far actions rn another state. This might occur in border cities that bout 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 />• 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 5rc relief association fund-raiser, fur <br />example. <br />• Claims based on a "talEing •' theory. Suits challenging Land use regulations frequently <br />include as "inverse condemnation" claim, alleging that the regulation amounts to a <br />"taking" of the property. <br />2. LMCIT's primary liability cover>ge hss staaasl limiia on coverage for a few speciSc <br />risks. The table on page 1 lists the liability risks to which aggegate coverage Limits <br />apply. If the city has a loss or claim in one of these areas, thtxe might not be enough <br />limit$ remaining to cover the city's foil exposure if theca is a second loss of the same surf <br />during the year. Excess liability coverage gives the city additional protection against this <br />risk as well. <br />However'there are a couple of import restrictions on how the excess coverage applies <br />to risks that are subject to aggregate limits: <br />• The excess coverage does not apply to three risks: lead and asbestos; failure to <br />supply utilities; anti Y7k, and <br />• The excess coverage does not automatically apply m liquor tiabitity unless the cfty <br />specifically requests it. <br />3. The city may be required by contract to carry higher coverage limits, Occasionally, <br />a contract aught include a requircmtnt that the city carry mote than S1,OQ0,000 of <br />coverage limits. Carrying excess coverage is a way to meet these requirements, ('There's <br />2 <br />