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Department of Central Services Risk Management Division (RM). Welcome Property and Liability Insurance Coverage Overview 2011. Introductory Remarks Today’s presentation will be available for you on the DCS Risk Management Website http://www.ok.gov/DCS/. Questions.

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department of central services risk management division rm

Department of Central ServicesRisk Management Division (RM)

Welcome

Property and Liability

Insurance Coverage Overview

2011

1

slide2
Introductory Remarks

Today’s presentation will be available for you on the DCS Risk Management Website

http://www.ok.gov/DCS/

4

questions
Questions
  • When the lines are opened, all participants will be able to hear your internal discussions;
  • Please speak one at a time and state:
    • Your name
    • Your position
    • Your agency or higher education entity
    • Your question

5

today s discussion items
Today’s Discussion Items
  • Introductory Remarks
  • Underwriting Surveys
  • Premium Payments
  • Purchase of Property and Liability Insurance Outside of RM Program
  • To Avoid Problems and Reduce Costs
  • MMSEA
  • Liability Trends
  • Liability (Self-insured)
    • Tort
    • Auto

2

today s discussion items marsh commercial lines of coverage
Today’s Discussion ItemsMarsh Commercial Lines of Coverage
  • Directors and Officers, Educators Legal Liability, Employment Practices Liability (Commercial Insurance with Self-insured Retention (SIR))
  • Insurance Policy Coverage Issues
  • Employee Dishonesty (Commercial Insurance)
  • Property Insurance
  • Fine Arts Insurance
  • Auto Physical Damage – Specialty/Passenger Vehicles
  • Other lines: Aviation, Foreign Liability, Out of State

3

underwriting surveys
Underwriting Surveys
  • Property
  • Fine Arts and Valuable Papers & Records
  • D&O / ELL
  • Vehicles
  • Out of State Travel
  • Foreign Travel
  • Employee Dishonesty

6

premium payments
Premium Payments
  • Budget for insurance costs
  • Credit incentives offered if payment received within 45 days of invoice
  • If it’s a budget issue, call RM

7

purchase of property and liability insurance outside of the rm program
Purchase of Property and Liability Insurance Outside of the RM Program
  • Call Risk Management
  • Governmental Tort Claims Act (51 O.S. § 158 (C). “If a policy or contract of insurance . . . is applicable, the terms of the policy govern the rights and obligations of the state . . .”
  • “Other Insurance” (You may have bought nothing but trouble.)

8

to avoid problems and reduce costs
To Avoid Problems and Reduce Costs
  • Need additional Property & Casualty coverage?
  • Call RM before purchasing (74 O.S. § 85.58A)

9

medicare secondary payer mandatory reporting provisions
Medicare Secondary Payer Mandatory Reporting Provisions

Update Section 111 of the Medicare, Medicaid, and SCHIP Extension Act of 2007 See 42 U.S.C. 1395y(b)(7) & (8)(MMSEA)

10

state of oklahoma liability trends

State of Oklahoma Liability Trends

Major Coverage Areas

11

liability discussion tort liability and auto liability

Liability Discussion:Tort Liability and Auto Liability

Similar to Commercial General Liability and Business Auto Liability Insurance In the Private Sector

17

self insured programs
Self-Insured Programs:
  • Tort Liability including Auto Liability
  • Governed by 51 O.S. § 151, et seq. the Governmental Tort Claims Act (GTCA) and RM Promulgated Rules, OAC 580:25-1-1, et seq.
  • No policy of insurance applies/No deductibles apply

18

strict adherence to gtca
Strict Adherence to GTCA
  • Limits:
    • Maximum of $25,000 Property Damage
    • Maximum of $175,000 each claimant (other than property)
    • Maximum of $1,000,000 all claimants arising out of single occurrence or accident
  • Claimant has 1 year from date of loss to file a claim
  • Claim shall be filed with RM
  • Exclusive remedy for tortious conduct of State employees
  • Specifies how recovery may be made
  • Broad exemptions from liability

19

state tort sub activity fund will only respond
State Tort Sub-activity FundWill Only Respond
  • If claim filed in accordance with GTCA
  • If the State or its employee is negligent
  • If the State employee is within the Scope of Employment as defined by the GTCA
  • State employees may be held personally responsible per GTCA
  • If there are no GTCA exemptions

20

claims outside of gtca protection u s constitutional and ok constitutional

Claims Outside of GTCA Protection(U.S. Constitutional and OK Constitutional)

Public Officials Liability (D&O)

Educators Legal Liability (ELL)

Employment Practices Liability (EPL)

21

d o ell epl
D&O, ELL, EPL
  • All lines insured
  • Self-insured retention applies
  • Essentially protects against U.S. Constitutional and Oklahoma Constitutional violations per exclusionary endorsement to all policies

22

tort claims with d o or ell allegations
Tort Claims With D&O or ELL Allegations
  • Claim filed under GTCA
    • Claim alleges Tort issues covered by GTCA
    • Claim alleges U.S. Constitutional and Oklahoma Constitutional Issues or possibly other allegations outside of GTCA
  • Possible coverage under both GTCA and D&O, ELL, EPL policies

23

gtca claims vs d o epl ell claims

GTCA Claims vs. D&O, EPL &ELL Claims

Why should you care about the difference between

GTCA and D&O, EPL & ELL?

Before a claim can be paid out of the Tort fund, a tort claim must be filed pursuant to the terms of the GTCA.

24

why should you care about the difference between gtca and d o epl ell

Why should you care about the difference between GTCA and D&O, EPL & ELL?

Some claims allege both GTCA violations as well as constitutional violations

Deductibles come into play: $0 for GTCA allegations; agency selected deductible for other allegations

25

gtca claims vs d o epl ell claims1

GTCA Claims vs. D&O, EPL &ELL Claims

Sample of claim with mixed allegations:

Claim properly made under the GTCA but also alleges a claim covered D&O or ELL--all claims (state and federal) settle for $1 million:

Payment allocated as follows:

Risk Tort Fund (GTCA) $175,000

Agency $150,000 (or agency selected deductible)

Risk D&O Fund $100,000

D&O Insurance $575,000

Total $1 million

26

to avoid problems and maximize recovery of losses
To Avoid Problemsand Maximize Recovery of Losses
  • Coordinate all property and liability claims through RM.
  • Report all claims to RM immediately
    • Do not delay reporting
    • Delays may inhibit your ability to recover losses

27

insurance policy coverage issues
Insurance Policy Coverage Issues
  • Do not attempt to interpret insurance coverage.
  • Do not allow others to interpret coverage.

Call RM

28

our ability to protect your assets depends upon you

Our Ability To Protect Your AssetsDepends Upon You

Communication

Reporting

Timeliness

29