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CompositionCompositionMunicipal Insurance 101
NY Municipal
Insurance Reciprocal
Robert Bambino
Syllabus
1. Town Ins. Programs
2. Coverages & Limits
3. Where Premium Dollars are Spent
4. Limits, Exclusions & other Pitfalls to Avoid
I. ‘Typical’ Town Property & Casualty Insurance Program
Property Insurance Loss or damage to buildings, property and equipment
Automobile Insurance Liability claims from third-parties and damage to owned vehicles
General Liability Public liability claims alleging injury, damage to property and other perils
‘Typical’ Town Property & Casualty Insurance Programs
Law Enforcement Liability
Claims arising from law enforcement activities & operations
Public Officials Professional liability claims arising from wrongful acts of the Board, elected and appointed officials
Excess Liability Additional limits above Automobile, General Liability, Law Enforcement and Public Officials Liability
II. Coverages & Limits
Property Dwellings, furniture, supplies, business property, equipment, records, computers; extra expenses
Blanket limit for all insured property within the Town
Automobile
(Liability &
Physical Damage)
Injuries and damages caused by autos, trucks, vans, snow plows; damage to owned/leased autos, trucks and vans
$1,000,000 CSL
$200 – 1,000
deductible for physical damage
Coverages and Limits
General Liability
Streets & roads, sidewalk claims, recreation, assaults
$1,000,000/
2,000,000
Law Enforcement
False arrest, use of force, civil rights
$1,000,000/
2,000,000
Public Officials
Employment practices, civil rights & land use
$1,000,000/
2,000,000
Excess ‘Follow-Form’ Policy
(Excess limits above liability policies)
$5,000,000 to
10,000,000
Other CoveragesInland Marine (“Floaters”) Damage to equipment off
premises with a lower deductible
Boiler & Machinery Damage to boilers & other equipment not covered within the property policy
Crime Coverage Employee theft and embezzlement
Limited Pollution Liability Covers sudden and accidental pollution events emanating on-premises
III. Allocation of Premium Dollars: Mid-Size Town
0% 5% 10% 15% 20% 25%
Gen. Liability
Automobile
Pub. Officials
Excess
Property
Law Enforcement
2005 Premium Projections
Property Flat
General Liability +2 to +4 Percent
Automobile Liability Flat
Workers’ Comp +5 to +10 Percent
Professional Liability +5 to +10 Percent
Excess/Umbrella Flat
Breakdown of Incurred Losses: Where are the Loss Dollars Going?
17%
27%
10%
18%
28%
Automobile
Gen. Liability
Property
Law Enforcement
Public Officials
IV. Limits, Exclusions & Other Pitfalls to Avoid: Property
Decorative street lights & signs not at a covered location
Property or equipment that travels > 100’ from a covered location
Newly acquired property
Clean-up expenses because of a pollution loss
Add to a “floater” policy
Add to a “floater” policy
Report to broker/ insurer within 180 days
Coverage limit of $10,000 – purchase higher limits
Limits, Exclusions & Other Pitfalls to Avoid: General Liability
•Owned underground or above ground storage tanks
• Liability deductibles
• Property in Town’s care and custody
• Asbestos/ lead abatement projects
Purchase separate environmental (tank) liability insurance Change for full coverage
Purchase Garage Policy for confiscated vehicles; floater if storing or warehousing nonowned property
Have contractor provide coverage,or purchase separate policy
Limits, Exclusions & Other Pitfalls to AvoidPublic Officials
• Fines & penalties • Wages & benefits – employment practices• Fiduciary liability – financial management of employee benefit plans• Limited land use coverage• EP liability sublimits
Risk control Risk control
Purchase Fiduciary Liability insurance policy
Risk control
Increase, remove or practice risk control
Frequently Asked QuestionsQ: Do I need a Builders Risk Policy?A: Yes, for large renovations and new construction –
unless the Gen. Contractor provides it
Q: What should the limits be for my employee theft coverage?
A: Difficult to determine. You can use: MPL x [ f ] f = efficiency of fraud control methods. Limits may
not be available!
Q: Do I have coverage for skateboard parks, pools and snowmobile trails?
A: Generally – yes, but you should contact your broker or insurer – might be an additional premium
Frequently Asked Questions
Q: Do we need to purchase mold coverage?A: Maybe – its something to check on. There
may be coverage under the GL policy; the Property policy only covers if it is a result of a covered loss.
Q: Which motor vehicles should I cover with Auto Physical Damage insurance?
A: Those vehicles you can’t afford to loose or replace.
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