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LMCIT staff studied a sample of claims and the results were <br />inconclusive. In many of the cases, liability seemed doubtful. <br />In about a fourth of the claims, there appearred to be some <br />possibility of liability. However, whether the medical payment <br />was the reason the injured individual did not bring a lawsuit <br />is pretty speculative. <br />III. Why would a city want to delete the medical payments <br />coverage? <br />There are at least three arguments in favor of deleting the <br />coverage. First, some may question the historic rationale for <br />the coverage. Arguably, it looks like a gift of public funds to <br />pay an individual, irrespective of fault. Second, the coverage <br />may sometimes act as a subsidy to other available insurance <br />sources, such as Medicare and other health coverage that might <br />not kick in until all other available sources of compensation <br />are exhausted. Consequently, we may in effect be subsidizing <br />other insurance providers. Finally, it can be argued that the <br />Trust already has the ability under the general liability <br />coverage provisions to make a payment to an individual as a .way <br />to avoid a potential lawsuit, if there is a real risk of <br />liability. <br />IV. How much of a premium credit will the city receive if it <br />deletes the medical payments coverage? <br />The credit given for cities choosing to delete the coverage .will <br />be 1% of their general liability premium. Our, review of <br />the medical payments history revealed that medical payments 3 <br />averaged about 1% of all indemnity payments made. <br />V. How do we go about deleting the coverage? <br />Have your agent contact LMCIT's underwriters at Berkley Risk <br />Services. The coverage can be deleted as part of the annual <br />renewal, or if the city desires, it can be deleted during the <br />year for a pro -rata refund of the premium credit <br />VI. Whom can we call if we have other questions? <br />If you need additional information or have other questions you <br />can contact Tom Grundhoefer or Pete Tritz at the League office, <br />or call the underwriter at Berkley Risk Services who handle <br />your city. <br />:lmci27 <br />Page 75 <br />