HomeMy WebLinkAbout2.e. Expanded Y2K Insurance Coverage CITY OF ROSEMOUNT
EXECUTIVE SUMMARY FOR ACTION
COMMITTEE OF THE WHOLE MEETING DATE: OCTOBER 13, 1999
AGENDA ITEM: EXPANDED Y2K INSUR.ANCE COVERAGE AGENDA NO.:
PREPARED BY: SUSAN M. WALSH I�� �, � , �
ASSISTANT TO ADMINISTRATOR
ATTACHMENTS: NONE APPROVED BY:
The City's carrier for liability insurance, League of Minnesota Cities Insurance Trust(LMCIT), is offering
expanded coverage for liability claims relating to Y2k problems. The City's current liability insurance coverage
is limited to $25,000 annual aggregate plus a 15% city co-pay for Year 2000 claims. Staff has discussed this
additional insurance with the City's risk manager who recommends that the City apply for the coverage. The
expanded coverage increases the annual aggregate limit for claims up to $750,000. The cost for this is around
$3,000. Although staff believes there will be few if any problems as a result of Y2k,there is always the
possibility that even though the City's systems work okay,the City could still be part of a law suit caused by
problems in another entity's equipment. Some examples are loss of power, loss of telephone communication or
traffic lights not working. Also, there's potential for the City being named in a lawsuit; and although the claims
may be groundless, the city's legal fees could easily exceed the $25,000 limit. Staff is looking for Council's
approval to apply for the additional coverage.