E-9. Approval of Upholding Monetary Limits on Tort Liability as Established by Minnesota Statute 466.04. lY
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CITY OF CHANIIASSEN
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MEMORANDUM
TO: Todd Gerhardt, City Manager
FROM: Chelsea Petersen, Assistant City Manager
DATE: November 14, 2016 D7
SUBJ: Tort Liability Limits
PROPOSED MOTION
"The City of Chanhassen does not waive the monetary limits on municipal tort liability
established by Minnesota Statutes 466.04."
A majority vote is required to approve.
BACKGROUND
Under Minnesota Statute 466.04 municipal tort liability is limited to a maximum of$500,000 per
claimant and $1.5 million per occurrence. These limits apply in the event a claim is filed against
the city, against the individual employee(s), or against both. The purpose of these caps is to
protect and preserve limited public resources.
The League of Minnesota Cities Insurance Trust, the city's insurance carrier, has requested that
the City Council take action with regards to tort cap liability limits as cities have the ability to
waive tort cap liability limits. The City of Chanhassen has historically NOT waived these limits.
STAFF RECCOMENDATION
Staff recommends that the City NOT waive our tort liability limits.
ATTACHMENTS
1. Liability Coverage Waiver Form
\\cfs5\cfs5\Shared_Data\Admin\CP\City Council\Tort Liability 2017.docx
PH 952.227.1100• www.ci.chanhassen.mn.us • FX 952.227.1110
7700 MARKET BOULEVARD • PO BOX 147 • CHANHASSEN • MINNESOTA 55317
O 0'
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.
Cik � CMGs
LMC Member Name
Check one:
(l The member DOES NOT WAIVE the monetary limits on municipal tort liability established by Minnesota Statutes,
Section 466.04.
❑ 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 OU', t q( 16(6?
Signature Position
145 UNIVERSITY AVE. WEST PHONE:(651)281-1200 FAX:(651)281-1299
ST. PAUL, MN 55103-2044 TOLL FREE:(800)925-1122 WEB:WWW.LMC.ORG