2.3 ERMUSR 05-09-2017 Elk River
Municipal Utilities UTILITIES COMMISSION MEETING
TO: FROM:
ERMU Commission Theresa Slominski—Finance and Office Manager
MEETING DATE: AGENDA ITEM NUMBER:
May 9, 2017 2.3
SUBJECT:
Resolution Electing Not to Waive Tort Limits Liability Insurance
ACTION REQUESTED:
Adopt Resolution Electing Not to Waive Statutory Tort Limits for Liability Insurance
BACKGROUND:
The League of Minnesota Cities Insurance Trust (LMCIT) requires annual approval of the
Utilities' intent to waive or not waive the statutory limits on tort liability as set forth in
Minnesota Statutes.
DISCUSSION:
Attached is information regarding making a decision on whether to elect not to waive, or to
waive,the statutory limits. Last year we did not waive the limits, and neither did the City. The
City Council did not waive the limits for this year either. The recommendation we have received
from our insurance agent is not to waive the limits.
FINANCIAL IMPACT:
This limits our exposure to $500,000 rather than$2,000,000 for an individual claimant; and
$1,500,000 rather than $2,000,000 for all claimants of a single occurrence.
ATTACHMENTS:
• Resolution No. 17.6—Electing Not to Waive the Statutory Tort Limits for Liability
Insurance
• LMCIT Liability Coverage Waiver Form
Page 1 of 1
9A
RESOLUTION No. 17-6
BOARD OF COMMISSIONERS
ELK RIVER MUNICIPAL UTILITIES
A RESOLUTION ELECTING NOT TO WAIVE THE STATUTORY TORT LIMITS
FOR LIABILITY INSURANCE
WHEREAS, Elk River Municipal Utilities (Utilities) participate in the League of Minnesota
Cities Insurance Trust (LMCIT) insurance program; and
WHEREAS, The LMCIT requires annual approval of the Utilities' intent to waive or not
waive the statutory limits on tort liability as set forth in Minnesota Statutes;
WHEREAS, The Utility has evaluated whether to waive the limit of tort liability and
whether to purchase excess liability coverage from the LMCIT.
NOW, THEREFORE, BE IT RESOLVED that the Elk River Municipal Utilities of the City of
Elk River elects to not waive the statutory tort liability limit established by Minnesota Statute
466.04.
This Resolution Passed and Adopted this 9th day of May, 2017.
John Dietz, Chair
Troy Adams, P.E., General Manager
nn
LEAGUE OF CONNECTING & INNOVATING
MINNESOTA SINCE 1913
CITIES
LIABILITY COVERAGE - WAIVER FORM
LMCIT members purchasing coverage must complete and return this form to LMCIT before the effective date of
the coverage. Please return the completed form to your underwriter or email to pstech@Imc.org
This decision must be made by the member's governing body every year. You may also wish to discuss these issues with
your attorney.
League of Minnesota Cities Insurance Trust(LMCIT) members that obtain liability coverage from LMCIT must decide
whether to waive the statutory tort liability limits to the extent of the coverage purchased. The decision has the following
effects:
If the member does not waive the statutory tort limits, an individual claimant would be able to recover no more than
$500,000 on any claim to which the statutory tort limits apply. The total all claimants would be able to recover for a
single occurrence to which the statutory tort limits apply would be limited to$1,500,000. These statutory tort limits
apply regardless of whether the city purchases the optional excess liability coverage.
If the member waives the statutory tort limits and does not purchase excess liability coverage, a single claimant could
potentially recover up to$2,000,000 for a single occurrence. (Under this option, the tort cap liability limits are waived to
the extent of the member's liability coverage limits, and the LMCIT per occurrence limit is $2 million.) The total all
claimants would be able to recover for a single occurrence to which the statutory tort limits apply would also be limited
to$2,000,000, regardless of the number of claimants.
If the member waives the statutory tort limits and purchases excess liability coverage, a single claimant could
potentially recover an amount up to the limit of the coverage purchased. The total all claimants would be able to
recover for a single occurrence to which the statutory tort limits apply would also be limited to the amount of coverage
purchased, regardless of the number of claimants.
Claims to which the statutory municipal tort limits do not apply are not affected by this decision.
LMCIT Member Name
Check one:
The member DOES NOT WAIVE the monetary limits on municipal tort liability established by Minnesota Statutes,
Section 466.04.
I 1 The member WAIVES the monetary limits on municipal tort liability established by Minnesota Statutes, Section
466.04 to the extent of the limits of the liability coverage obtained from LMCIT.
Date of city council/governing body meeting
Signature Position
145 UNIVERSITY AVE. WEST PHONE: (651) 281-1200 FAX: (651) 281-1299
ST. PAUL, MN 55103-2044 TOLL FREE: (800) 9254122 WEB:WWW.LMC.oRG
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