Public entities face a unique environment regarding liability; the contrast between evolving exposures and litigation trends, and the acute pressure to reduce costs and align budgets to sometimes inadequate public funding creates a complicated web of choices for administrators in the public sector. In just the last decade, public entity claims resulting in awards over $1 million have been continually increasing. The emergence of new exposures is a reality for all public entities, and the comprehensiveness of your liability coverage is a crucial issue that you, as a public organization, must address.
Proper risk management is a crucial factor in the successful governance of public entities, and the specific type of coverage that is right for your organization depends on many factors, including your type of organization, nuances of your state’s relevant legislation and the way that your organization interacts with the public. There are a few things you should consider before designing a liability coverage plan.
Managing Risk in the Public Sector
Public entities include state government, local communities, intergovernmental pools or municipalities. Although these have many of the same exposures as a typical business, they are often protected against lawsuits by state liability caps, immunity defenses or early reporting requirements. Despite these legal advantages, public entities must address such substantial liability risks because state immunities are constantly changing and are often challenged, and require expert monitoring for accurate and up-to-date interpretation.
Public entity exposures can generally be divided into two categories: first- or third-party operational exposures and management liability exposures. New trends in claims are constantly emerging.
Examples include the following:
- School violence/cyber-bullying
- Police excessive force/Tasers
- Failure to educate
- Global warming
- Employment practices liability
- Dangerous conditions on public property
Precisely because of their public nature, civil rights laws are highly applicable to public entities. For this reason, employment claims are quite common.
Perhaps the most important factor to consider when managing your property and liability coverage is the true cost of risk as opposed to the price of the premium. Under pressure to cut costs, public entities may be drawn to pay the lowest premium possible. However, immediate savings on a premium often leads to an elevated total cost due to uncovered claims or uninsured exposures related to specialty claims. It is unlikely that any risk management program will be able to eliminate all claims against an actively operating local government entity. Therefore, it is crucial to design a comprehensive plan in order to lower the total cost of risk to the public entity.
The risks and exposures of public entities are unique. Designing the appropriate coverage requires the knowledge and dedication of the experts at The Horton Group. We stay abreast of the trends in the market and can work with you to effectively and skillfully manage your organization’s risk.
Material posted on this website is for informational purposes only and does not constitute a legal opinion or medical advice. Contact your legal representative or medical professional for information specific to your legal or medical needs.