2.4 ERMUSR 04-09-2024Ji
Elk River amft .
Municipal Utilities UTILITIES COMMISSION MEETING
TO:
FROM:
ERMU Commission
Melissa Karpinski — Finance Manager
MEETING DATE:
AGENDA ITEM NUMBER:
April 9, 2024
2.4
SUBJECT:
Resolution Electing Not to Waive Statutory Tort Limits for Liability Insurance
ACTION REQUESTED:
Adopt Resolution 24-5 Electing Not to Waive the 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 the waiver form which also has information to help make the decision to waive or
not waive the statutory limits. Last year we did not waive the limits, and neither did the City.
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. 24-5 - Electing Not to Waive the Statutory Tort Limits for Liability
Insurance
• LMCIT Liability Coverage Waiver Form
Page 1 of 1
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RESOLUTION NO. 24-5
BOARD OF COMMISSIONERS
ELK RIVER MUNICIPAL UTILITIES
A RESOLUTION OF THE BOARD OF COMMISSIONERS OF ELK RIVER MUNICIPAL UTILITIES
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 9t" day of April 2024.
John Dietz, Chair
Mark Hanson, General Manager
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LMC
LEAGUE f.d
MINNESOTA
CITIES
LIABILITY COVERAGE — WAIVER FORM
Members who obtain liability coverage through the League of Minnesota Cities Insurance Trust
(LMCIT) must complete and return this form to LMCIT before the member's effective date of
coverage. Return completed form to your underwriter or email to pstech(&lmc.org.
The decision to waive or not waive the statutory tort limits must be made annually by the
member's governing body, in consultation with its attorney if necessary.
Members who 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 could recover no more
than $500,000 on any claim to which the statutory tort limits apply. The total all claimants could
recover for a single occurrence to which the statutory tort limits apply would be limited to $1,500,000.
These statutory tort limits would apply regardless of whether the member purchases the optional
LMCIT excess liability coverage.
If the member waives the statutory tort limits and does not purchase excess liability, coverage, a single
claimant could recover up to $2,000,000 for a single occurrence (under the waive option, the tort cap
liability limits are only waived to the extent of the member's liability coverage limits, and the LMCIT
per occurrence limit is $2,000,000). The total all claimants could 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
could 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.
LEAGUE OF MINNESOTA CITIES 145 University Avenue West 131Ih4: (651) 281-1200 F')t' (651) 281-1298
INSURANCE TRUST St. PaU41Tinnesota 55103 rll:!(800) 925-1122 www.Imc.org
LMCIT Member Name:
Check one:
The member DOES NOT WAIVE the monetary limits on municipal tort liability established by Minn.
Stat. § 466.04.
The member WAIVES the monetary limits on municipal tort liability established by Minn. Stat. §
466.04, to the extent of the limits of the liability coverage obtained from LMCIT.
Date of member's governing body meeting:
Signature:
Position:
Ev
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