HomeMy WebLinkAboutAgenda Report - April 17, 1996 (54)AGENDA TITLE: Increase Liability Insurance Limits for Transit Services
MEETING DATE: April 17, 1996
PREPARED BY: Public Works Director
RECOMMENDED ACTION: Council is requested to authorize increasing the liability insurance limits
for transit operations from $5,000,000 to $10,000,000 per occurrence.
This insurance is purchased through the California Transit Insurance Pool
(CALTIP), a joint -power agency which insures our transit system.
BACKGROUND INFORMATION: The City presently purchases liability insurance from CALTIP. This
is an organization made up of many publicly operated transit
systems in California. We have a pooled layer of insurance of
$500,000 and presently purchase excess coverage of $4,500,000.
Our present cost is $57,106 per year for our seventeen transit vehicles. We can purchase an additional
$5,000,000 at a cost of $179 per vehicle per year, or a total additional cost of $3,043.
The Lodi Transit System is now carrying over 200,000 passengers per year. At times we have standing
room only on the GRAPELINE, which certainly increases our exposure to risk. If we had a judgment
over $5,000,000 as a result of an accident, the amount of money over the $5,000,000 would have to be
paid from City revenues. The amount of Federal and State dollars are insignificant to the potential
liability. It is a good risk management practice to transfer the risks to an insurance company. It seems
that the cost of $3,043 is an excellent expenditure of funds to provide an additional $5,000,000 of
protection. The City's Risk Manager and City Attorney are in agreement with this recommendation.
The insurance policy runs from May to May which is the reason this request is being made now rather
than in July with our other liability policies. Council is respectfully requested to approve this increase in
our liability insurance.
FUNDING: FTA and TDA funds
Prepared by Jerry L. Glenn, Assistant City Manager
JLR/JLG/Im
cc: City Attorney
Risk Manager
Jack\L. Ronsko
Publ' Works Director
APPROVED:
H. Dixon Flynn -- Cityanagen
TRNSTINS.DOC 04/09/96