CCP 06-24-2008 - Laserfiche WebLink

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Republican National Convention JPA Page 4 The following is a brief summary of the policy: • $10 million limit of liability for each wrongful act. • $10 million aggregate limit (i.e., the most the policy will pay out is $10 million for any and all claims). • No deductible. • Occurrence policy (i.e., coverage for losses which occur during the policy period, regardless of when the claim is asserted). • The coverage is primary (the policy will respond to a claim before a city's LMCIT coverage applies, subject to the policy limits). • Defense costs are outside the liability limit (however, attorney fees or expenses awarded to a plaintiff would be subject to the limit). In terms of the coverage, it is important to look at the exclusions in Section V of the law enforcement policy. The policy excludes coverage for a "willful violation ... of any federal, state, or local statute, ordinance rule, or regulation" and any "dishonest, fraudulent, bad faith, criminal or malicious: [a]ct; [e]rror or [o]mission." It is easy to imagine that a claim might involve allegations of this kind of conduct. The terms of the policy indicate coverage for damages in a claim of this sort against a peace officer would be excluded, although the policy may provide for defense. . More importantly, the policy language seems to exclude coverage for damages against the city when an officer is found to have acted in willful violation, bad faith, etc. The policy also appears to exclude any claim for punitive damages. It is our understanding that some of the terms of the policy are still being clarified, specifically with regards to coverage for a city when its officer is found to have acted in willful violation of the law, bad faith, or similar. One factor that cities should consider is that municipal tort liability limits of $400,000 per claimant and $1.2 million per occurrence would not apply to federal claims against a police officer, including claims of excessive force. In addition, cities should be aware that if a plaintiff is successful, the city could be ordered to pay a substantial award of attorney fees even if the actual damages awarded to the plaintiff are relatively small. The payment of a plaintiff's attorney fees would count toward the $10 million policy limit. If the $10 million limit of the law enforcement liability policy is exhausted, a city's LMCIT liability coverage would provide excess coverage. In other words, a city's LMCIT coverage would respond to a claim against the city or a city's police officer that arose from the officer's actions during the RNC. Such a claim would be subject to the city's deductible and LMCIT coverage limits. In addition, the claim would affect a city's experience rating. The experience rating formula used by LMCIT looks at a city's past loss experience as a way to project the city's future losses. The experience rating will then be used to determine future premiums. A claim could also affect the amount of a dividend that is returned to a city by LMCIT. A dividend is only •