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Insurance Coverage

Managing Alcohol Sales at Municipal Golf Courses, Country Clubs, or Marinas

This Loss Bulletin is intended to help municipalities reduce their risk of civil liability in connection with offering alcoholic beverages at Municipal Golf courses, Country Club or Marinas.  Understanding current case law and the changes in state regulation of alcoholic beverage sales and acting accordingly should greatly reduce the risk to cities and towns.

On November 8, 2016 the voters of the State of Oklahoma approved a State Question 792 that modified the regulation of alcohol sales throughout the state.  The law was not effective until October 1, 2018 to allow time for transition.  For the most part Article 28 of the Oklahoma Constitution was repealed and Article 28A was put in its place to govern Alcoholic Beverage Laws and Enforcement.  Under the prior regulations, beer or beverages containing 3.2% or less alcohol by volume were not considered to be alcoholic beverages.  Under the new regulations “alcoholic beverages” are defined as “All beverages that contain alcohol, unless otherwise defined by law, shall be considered alcoholic beverages by this state and therefore governed by this Article and all other applicable laws.”[1]

How does this change affect cities and towns across the state?  While municipal golf courses, Country Clubs, or Marinas in the past have been licensed by a county or a city to sell non-alcoholic beverages (3.2% or lower in alcohol by volume) several have asked how the new law might impact beer sales with a greater volume of alcohol in those beverages. 

Implementing statutes to this Constitutional provision can be found in Title 37  and 37A Okla. Stat. Section 1-101 et seq.  During its second session, the 55th Oklahoma Legislature enacted substantial amendments to Title 37 (Intoxicating Liquors) of the Oklahoma Statutes and added a new Title 37A (Alcoholic Beverages). The enactments from the 2016 Session affected over 400 sections in the Oklahoma Statutes relating to alcoholic beverages, including about 370 sections in Titles 37 and 37A.  Most of these amendments from the 2016 Session were effective on October 1, 2018.[2]

During the 2019 legislative session additional clarifications to the law were made by the passage of Senate Bill 728 which passed with an emergency clause becoming effective upon its signing by the Governor on April 10, 2019.  Among other things, SB 728 provided that an alcohol beverage “licensee may sell beer and wine for off-premises consumption if it meets the classification of a golf course, country club, or marina” [3]

First, it is important to know that cities, as political subdivisions of the State, are prohibited from the retail distribution of alcoholic beverages. [4]  If cities and towns are determined to serve alcoholic beverages at golf courses and other qualifying recreational facilities, then one approach is to consider contracting with an independent contractor to provide that service.  An independent contractor would need to apply with the ABLE Commission for the appropriate license(s) to sell both on premises and off premises if the desire is to sell beer that can then be consumed on the golf course.  The licensing process is somewhat detailed and can be accessed on the ABLE website.[5] Some of the advantages of using an independent contractor to provide wine and beer on the public golf course or another qualifying recreational facility are:  1) requires the independent contractor to navigate the applicable ABLE regulations; 2) requires the independent contractor to properly train and supervise their own employees to ensure proper handling of risks associated with serving alcoholic beverages to patrons[6]; 3) minimizes a town or city’s investment needed to provide this amenity for its patrons.  

Another option for a city or town that would like to serve alcoholic beverages at a city golf course or qualifying recreational facility may be to utilize a public trust of which the city or town is a beneficiary.  A public trust is a separate legal entity than a city or town and thus would not fall within the prohibition of selling alcoholic beverages that applies to a city as a political subdivision.  The license from the ABLE Commission could be held by a Public Works Authority, a Municipal Authority, or other public trust organized under the Oklahoma Public Trust Act. [7]  The licensing process through the ABLE Commission would need to be followed. (see footnote #5).  The land or property upon which the alcoholic beverage dispensing would occur would need to be under ownership, lease or control by the Public Trust and all Trustees of the Public Trust will need to execute the appropriate background investigation documents.  In addition, for OMAG member towns and cities who carry General Liability or Property Damage Policies, under Section VI, Exclusion 14 there is no coverage under those policies for serving or furnishing alcoholic beverages for a charge.[8] 

Should a City or town desire to extend coverage to its public trust that would be involved in the sale of alcoholic beverages at our municipal golf courses or other qualifying recreational facilities, then a special rider or waiver of this exemption would need to be considered.[9] Please contact OMAG if you need additional information or guidance.  The information provided in this bulletin is not intended to be legal advice.  Specific facts and circumstances unique to your town or city should be discussed with your City Attorney for legal guidance. 

 

[1]Okla. Const. Article 28A, Section 1

 [2] OSCN has prepared a table that lists all sections in Titles 37 and 37A affected by the 2016 enactments. This table shows the disposition of all affected sections in Title 37 (amendments, repeals, and renumberings), and it shows the source of all sections added to the new Title 37A. This table should help OSCN users to determine which sections in Titles 37 and 37A have been affected. OSCN Dispositional Table – 2016 Acts Affecting Titles 37 and 37A   (PDF, 21 pages)

 [3] Golf course, Country Club or marina pursuant to the most recently adopted North American Industry Classification System (NAICS). 37A Okla. Stat, sections 2-110 (2), 2-128(2).

 [4] Okla. Const Art. 28A § 8. State and other governing entities prohibited from engaging in alcoholic beverage business

The State of Oklahoma, or any political subdivision thereof, or any board, commission or agency thereof, is hereby prohibited from engaging in any phase of the alcoholic beverage business, including the manufacture, sale, transportation or distribution thereof, at wholesale or retail, and the maintenance, ownership or operation of warehouses or alcoholic beverage stores; except that if the voters of a county in which a state lodge is located approve retail sale of alcoholic beverages by the individual drink for on-premise consumption, and if the State Legislature enacts legislation approving such sales in any such lodges located in any such counties, then such sales are authorized. The Legislature may enact laws restricting the involvement of officers and employees of the state and political subdivisions thereof in the alcoholic beverage business.

Provided, that nothing herein shall prohibit the sale of alcoholic beverages legally confiscated as provided by law.

 [5] https://www.ok.gov/able/documents/ABLE%20Form-Beer%20%20Wine%20Application.pdf

 [6] Brigance v. Velvet Dove Restaurant, Inc. 1986 OK 41, 725 P.2d 300 “At common law a tavern owner who furnishes alcoholic beverages to another is not civilly liable for a third person's injuries that are caused by the acts of an intoxicated patron. Such rule is principally based upon concepts of causation that, as a matter of law, it is not the sale of liquor by the tavern owner, but the voluntary consumption by the intoxicated person, which is the proximate cause of resulting injuries, so that the tavern owner is therefore not liable for negligence in selling the liquor.” @301 “We hold today that public policy is better served by holding that the common law principles of negligence are applicable where a commercial vendor for on the premises consumption is shown to have sold or furnished intoxicating beverages to a person who was noticeably intoxicated from which a jury could determine that such conduct creates an unreasonable risk of harm to others who may be injured by the person's impaired ability to operate a motor vehicle. Based upon compelling reasons we, thus, reject the common law doctrine of tavern owner nonliability in Oklahoma.” @305-306.  Oklahoma Courts, since Brigance, have declined to extend the common law modification beyond the factual circumstances of that case, i.e. an innocent third party injured as the proximate cause of the negligence of the commercial server who knew or should have known by their observation that the person being served was too intoxicated to safely operate a motor vehicle. See BATTLES v.  COUGH, 1997 OK CIV APP 62, 947 P.2d 600, Wrongful death action was brought against alleged social host and restaurant for serving alcoholic beverages to motorcyclist subsequently involved in collision that killed passenger. The Court of Civil Appeals, held that the alleged social host was not liable for serving alcoholic beverages to motorcyclist under the facts of that case including there is no duty on vendor to deny service of alcoholic beverages to persons who will or might become intoxicated thereby; evidence that motorcyclist drank three beers and two mixed drinks in one hour and five minutes did not permit inference that restaurant served him alcohol when he was noticeably intoxicated; evidence of loud talking in restaurant by member of group that included motorcyclist also did not permit such an inference.  See OHIO CASUALTY INSURANCE COMPANY v. Todd's Tavern et al., 1991 OK  54, 813 P.2d 508.  Question was certified from Federal District Court regarding possible cause of action intoxicated driver had against tavern owner. The Supreme Court held that tavern owner has no liability to intoxicated adult who voluntarily consumes alcoholic beverages to excess and sustains injury as result of his intoxication.  See TEEL v. WARREN, III, et al., 2001 OK CIV APP 46, 22 P.3d 234. Guest brought action against fraternity for personal injuries he allegedly sustained when he was assaulted by fraternity member while attending a party at the fraternity house. The Court of Appeals held that any action by fraternity which violated statute barring the furnishing of alcohol to a person under the age of 21 could not be proximate cause of injuries suffered by guest at fraternity house when 19-year-old fraternity member became intoxicated and assaulted him; fraternity was not commercial seller of alcoholic beverages, but a social host. 37 Okl.St.Ann. § 537; See also SMITH v. TEEL, et al, 2008 OK CIV APP 7, 175 P.3d 960.  Spouse of car passenger killed in collision with vehicle driven by intoxicated patron of restaurant and dance club brought wrongful death action against restaurant, which was a limited liability company, and two of its alleged managers and owners.  The Court of Civil Appeals held that alleged managers and owners could not be personally liable for death of passenger.

 [7] See Oklahoma Public Trust Statutes - Title 60 Okla. Stat. Section 176 et seq

 [8] OMAG MPPP & MLPP Policies – “VI. EXCLUSIONS. We have no obligation to pay nor do we have any obligation to defend any claim against a plan member on account of:  . . . 14. Loss for which any plan member, if serving or furnishing alcoholic beverages for a charge, may be held liable by reason of:   a. causing or contributing to the intoxication of any person; or  b. the furnishing of alcoholic beverages to a person under the legal drinking age or under the influence of alcohol.”

 [9] Thirty-five OMAG members cities have been identified as having properties described as golf courses in the MPPP. Those members in the MPPP using that criteria are: Altus, Ardmore, Blackwell, Boise City, Buffalo, Cedar Valley, Clinton, Edmond, Enid, Fairview, Guymon, Hobart, Hooker, Kingfisher, Lindsay, Medford, Midwest City, Okeene, Owasso, Pawnee, Ponca City, Prague, Pryor Creek, Purcell, Sand Springs, Sapulpa, Sayre, Seminole, Shattuck, Stroud, Tahlequah, Walters, Watonga, Wewoka and Woodward.  In addition, any city or town that OMAG provides general liability coverage (MLPP) to that are not afforded property coverage by OMAG has the same exclusions contained in that policy. That portion of the reported expenditures on the forms provided by our members to the State Auditor report expenditures for Culture & Recreation could include expenditures for parks, playgrounds, golf courses, swimming pools, museums, marinas, community music, Drama, celebrations, and zoos.  So, some additional effort would be needed to poll other cities to see if they are anticipating selling alcoholic beverages at golf courses or other qualifying recreational facilities.

 

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Your OMAG Municipal Property Protection Plan (MPPP) - Coverage for Outdoor Property

As personnel in municipal offices change, replacing the knowledge and experience of the person that served your municipality can be difficult.  Understanding insurance coverage may not be a priority when so many other things demand your attention as a municipal employee. Please let the following serve to provide a description of the coverage for outdoor property that OMAG provides.  

Outdoor Property is sometimes referred to as property in the open and should be listed on your schedule of covered property described as such. Outdoor property does not provide coverage for buildings and is only for the named structures listed below.  

Outdoor Property means retaining walls not part of a building, lawns (including fairways, greens and tees), trees, shrubs, plants, bridges (excluding vehicular bridges), walks, roadways, patios or other paved surfaces, outdoor lighting fixtures (excluding holiday and seasonal lighting), traffic signaling devices or controls, utility poles (including transformers on the poles but not including the transmission lines), or emergency communications radio towers or sirens, and fire hydrants.

Outdoor property is covered for loss or damage only by the following Covered Causes of Loss: Wind, Fire, Lightning, Explosion, Riot or Civil Commotion, Vandalism or Malicious Mischief, or Aircraft or Vehicles. This coverage also applies to the necessary and reasonable expense incurred by the plan member to remove debris of outdoor property at the plan member’s premises caused by or resulting from a covered cause of loss that occurs during the policy period. Such expenses will be paid only if reported to OMAG in writing within 180 days of the date of direct physical loss or damage. This will not increase the limit of coverage that applies to Outdoor Property. 

It is important to understand each MPPP member is automatically provided $100,000 in coverage for outdoor property, including debris removal aggregate in any one plan year; however, trees, shrubs and plants are subject to a maximum of $5,000 per occurrence. Although this $100,000 in coverage is provided to all MPPP members you are responsible for providing timely and accurate lists of such properties so that any loss incurred over the provided limit is properly covered.  To assure adequate protection in the case of a loss, your property needs to be reviewed annually to ensure it is listed on your schedules at replacement cost value.

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Understanding Your OMAG Cyber Liability Coverage

As personnel in municipal offices change, replacing the knowledge and experience of the person that served your municipality can be difficult.  Understanding insurance coverage when so many other things seem to demand our attention may not be a priority. Please let the following serve to provide a basic description of the cyber liability coverage OMAG provides.  Please refer to your cyber liability and data breach response supplemental declarations page to review applicable limits. 

Information Security and Privacy Liability - Covers damages and claims expenses because of a claim for:

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  • theft, loss, or unauthorized disclosure of personally identifiable non-public information or third-party information that is in the care, custody, or control of the insured organization

  • one or more of the following acts or incidents that directly result from a failure of computer security to prevent a security breach

    • the alteration, corruption, destruction, deletion, or damage to data stored on computer systems

    • the failure to prevent transmission of malicious code from computer systems to computer or network systems that are not owned, operated or controlled by an insured; or

    • the participation by the insured organization’s computer systems in a denial of service attack directed against a computer or network systems that are not owned, operated or controlled by an insured

  • failure to timely disclose an incident described above in violation of any breach notice law
    failure to comply with that part of a privacy policy that specifically:

  • prohibits or restricts the disclosure, sharing or selling of a person’s personally identifiable non-public information;

    • requires the insured organization to provide access to personally identifiable non-public information or to correct incomplete or inaccurate personally identifiable non-public information after a request is made by a person

    • mandates procedures and requirements to prevent the loss of personally identifiable non-public information

    • failure to administer (a) an identity theft prevention program or (b) an information disposal program required by regulations and guidelines

Privacy Breach Response Services - Provides privacy breach response services because of:

  • theft, loss, or unauthorized disclosure of personally identifiable non-public information or third-party information that is in the care, custody, or control of the insured organization; or

  • one or more of the following acts or incidents that directly result from a failure of computer security to prevent a security breach

    • the alteration, corruption, destruction, deletion, or damage to data stored on computer systems

    • the failure to prevent transmission of malicious code from computer systems to computer or network systems that are not owned, operated or controlled by an insured; or

    • the participation by the insured organization’s computer systems in a denial of service attack directed against a computer or network systems that are not owned, operated or controlled by an insured.

  • Privacy breach response services include the following:
    forensic and legal assistance from a panel of experts to help determine the extent of the

  • breach and the steps needed to comply with applicable laws

  • notification to persons who must be notified under applicable law
    credit and identity monitoring services to affected individuals
    public relations and crisis management expenses

Regulatory Defense and Penalties - Covers claims expenses and penalties resulting from a claim in the form of a regulatory proceeding resulting from a violation of privacy law and caused by any of the following incidents:

  • theft, loss, or unauthorized disclosure of personally identifiable non-public information or third-party information that is in the care, custody, or control of the insured organization

  • one or more of the following acts or incidents that directly result from a failure of computer security to prevent a security breach

    • the alteration, corruption, destruction, deletion, or damage to data stored on computer systems

    • the failure to prevent transmission of malicious code from computer systems to computer or network systems that are not owned, operated or controlled by an insured; or

    • the participation by the insured organization’s computer systems in a denial of service attack directed against a computer or network systems that are not owned, operated or controlled by an insured

    • failure to timely disclose an incident described above in violation of any breach notice law

Website Media Content Liability - Covers damages and claims expenses for one or more of the following acts committed during the course of the insured organization’s display of media material on its website or on social media web pages created or maintained by or on behalf of the insured organization:

  • Defamation, libel, slander, infliction of emotional distress, outrage, or other tort related to disparagement or harm to the reputation or character of any person or organization

  • Violation of the rights of privacy of an individual

  • Invasion or interference with an individual’s right of publicity

  • Plagiarism, piracy, misappropriation of ideas

  • Infringement of copyright, domain name, trademark, trade name, trade dress, logo etc

  • Improper deep-linking or framing within electronic content

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PCI Fines, Expenses and Costs - Indemnifies insured for PCI Fines, expenses and costs insured becomes legally obligated to pay because of a claim

Cyber Extortion - Indemnifies the insured for certain cyber extortion loss, subject to policy conditions, as a direct result of an extortion threat 

First Party Data Protection - Indemnifies the insured for certain data protection loss incurred as a direct result of: 

  • Alteration, corruption, destruction, deletion, or damage to a data asset

  • Inability to access a data asset that is directly caused by a failure of computer security to prevent a security breach

First Party Network Business Interruption - Indemnifies the insured for certain business interruption loss sustained during the period of restoration as a direct result of the actual and necessary interruption of computer systems caused directly by a failure of computer security to prevent a security breach

The descriptions contained in this communication are for informational purposes only. The exact coverage afforded by the product described herein is subject to and governed by the terms and conditions of each policy issued. 

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MUNICIPAL WATER & WASTEWATER TREATMENT PLANT COVERAGE

Many of our Municipal Property Plan members own and operate their own Water and Wastewater Treatment Plants. Operating these plants can present challenges in providing routine plant maintenance, meeting growing population needs, staying in compliance with regulatory requirements and upgrading their outdated structures and equipment. Many have provided these upgrades and many more will soon need to do so. These upgrades can certainly impact values and leave your municipality exposed. Backup generators, upgraded or added pumps, electric control panels and SCADA systems are exposed to lightning and power outages. Buildings, fencing and lighting are exposed to hail and high winds and vandalism. 

 OMAG initiated an appraisal project on these plants in 2016 by partnering with a professional appraisal service and will be providing appraisal reports to all members currently insuring these plants. This is a five-year project scheduled to be completed in the Fall of 2020. These professional appraisals will be provided as a value-added service at no charge to members. Our purpose in performing these appraisals is to be certain that you are provided an accurate replacement value for these structures and equipment.

To be properly insured, all structures at these plants need to be scheduled (listed) and valued separately at replacement value. City Administration and Plant Managers need to review all structures at these plants each year regardless of whether your municipality has experienced an upgrade.   

OMAG is here to assist you in any way we can. Please contact Underwriting Director Chris Webb, or Member Services Director Dorie Spitler, and let us help you review your coverage.     

 

 

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Using Minors as Volunteers

Using Minors as Volunteers

The responsibility to respond to our members' coverage questions and provide coverage interpretation primary falls on OMAG’s Underwriting and Member Services Departments with support provided by OMAG’s Legal and Risk Management Departments. Providing a clear and consistent response to these inquiries is always our goal.

Our members occasionally ask “May we use minors on special municipal projects as volunteers?  

A person is an employee if they are authorized to act on the behalf of your municipality. It does not matter how old they are, whether they are compensated or a volunteer, or whether they are full or part time. The exception is when an independent contractor relationship exists. 

A minor who performs volunteer services for your municipality can thus create liability. As such, if your municipality is considering using minors on special projects or events or assisting with mowing, trimming or cleanup, at the very least you should be sure that all training and any certification related to the responsibilities of the task have been successfully completed. Additionally, it would be your responsibility to see that any volunteer was properly supervised in the execution of the task assigned. 

Virtually all states set the age of majority at 18, which means people 18 and older are legally considered adults and are subject to all associated rights and responsibilities. Anyone under that age exposes the city to additional risks. For minors under 16, OMAG would refer the municipality to Oklahoma State Statues, Section 72.1 of Title 40 which outlines the types of work minors under 16 may not perform and requires consent of a guardian or parent for all occupations when performed on a volunteer basis. 

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Storm Season and Your Municipality's Auto Exposure

Protecting your municipality’s autos and equipment can be challenging, as most of our pool members have no means to park or store their equipment to protect it from hail or wind driven debris. During our storm seasons, we find we must dispatch our emergency vehicles to various areas within the municipality to best protect the public. When possible, when we experience this type of event, we should consider moving our autos and equipment to any covered area that we can find. Use of a covered car wash or bank could save your municipality considerable property damage. 

When damage does occur, many times estimates for repair can include a repair method known as Paintless Dent Repair. 

Paintless Dent Repair (PDR), also known as “Paintless Dent Removal” is a collection of techniques for removing minor dents and dings from the body of a motor vehicle. A wide range of damage can be repaired using PDR; however, usually if there is paint damage, PDR may be unsuitable. 

The most common practical use for PDR is the repair of hail damage, door dings, minor body creases, and minor bumper indentations. The techniques can also be applied to help prepare the damaged panel for paint. Such applications are referred to as “push to paint”, or “push for paint”. 

Limiting factors for a successful repair using PDR include the flexibility of the paint, and the amount the metal has been stretched by the damage incurred. Hence, often extremely sharp dents and creases may not be repairable – at least not without painting afterwards. 

Methods of Repair

The most common methods of PDR utilize metal rods and body picks to push the dents out from the inner side of the body panel being repaired. Also, glue may be used from the outside of the panel to pull the dents out. In either case, fine-tuning of the repair often involves “tapping” down the repair to remove small high spots, making the surface flat. PDR may be used on both aluminum and steel panels. If a technician pushes too hard when creating these high spots, the paint will split and the repair is ruined. Quality technicians can use these high spots that are barely visible to match the texture of the paint. 

The technology of PDR has been around for many years. Fluorescent lighting, or in some cases a light-reflection board, is used to see the shadows created by the deformation of the dent. This is an important aspect of the repair process. Without a PDR light board or reflector board, the fine detail of the process is unseen, and the technician cannot locate their tool specifically and cannot remove the damage accurately. The process of PDR requires a technician to specifically push exact locations of metal to precise height, which can be witnessed with use of a PDR reading instrument such as a PDR reflector board or PDR light.  

Many of the larger body shops now offer Paintless Dent Repair as an alternative to the normal body repair and paint. PDR can be done for about one third of the cost in one third of the time and can keep some vehicles from being out of service for longer than necessary or determined to be total losses. Many of these same body shops subcontract the work to shops that use the PDR method. Use of this process, when appropriate, can help the city keep their loss ratios lower with the lower damage repair costs. 
 

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Courtesy Vehicles at Airparks - Are We Covered?

Courtesy Vehicles at Airparks - Are We Covered?

The responsibility to respond to our members' coverage questions and provide coverage interpretation primarily falls on OMAG’s Underwriting and Member Services Departments with support provided by OMAG’s Legal and Risk Management Departments. Providing a clear and consistent response to these inquiries is always our goal.

Our members occasionally ask “If we provide a courtesy vehicle to visitors at our airpark, are we covered?”

Our Municipal Liability Protection Plan (MLPP) provides that coverage is afforded to “Any other person while using an owned automobile with the permission of the named plan member, provided that the person’s actual operation or other actual use of the automobile is within the scope of such permission… “

If the city has scheduled a vehicle on the policy with the appropriate coverage and the city gives an individual permission to drive the vehicle, the city is provided coverage under the plan.

We would suggest that you work with your City Attorney to draw up a Courtesy Car Agreement (example provided below). The driver’s personal information, along with the appropriate city employee signature should be required. The stipulation to stay within city limits is strongly suggested as well as requiring a time and date for the vehicle to be returned.  Any requirement to replace the fuel should be at the discretion of the city.

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Special Events and Use of Facilities Exposure - Municipal Liability Protection Plan (MLPP)

Special Events and Use of Facilities Exposure - Municipal Liability Protection Plan (MLPP)

The responsibility to respond to our members' coverage questions and provide coverage interpretation primary falls on OMAG’s Underwriting and Member Services Departments with support provided by OMAG’s Legal and Risk Management Departments. Providing a clear and consistent response to these inquiries is always our goal.

Our members occasionally ask “Are we covered for special events that take place in our municipalities? What if someone is injured in our park or one of our buildings when these special events take place? What if we lease our park or a building to a private group? 

OMAG has prepared a loss bulletin to assist our municipalities in identifying the various areas of liability created under these circumstances and to provide suggested ways to avoid or shift the risk to others where possible. Please take a moment to review the loss bulletin attached and share it with your municipal administrator and board.   

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OMAG Municipal Liability Protection Plan (MLPP) - Who Is Covered?

OMAG Municipal Liability Protection Plan (MLPP) - Who Is Covered?

The responsibility to respond to our members' coverage questions and provide coverage interpretation primary falls on OMAG’s Underwriting and Member Services Departments with support provided by OMAG’s Legal and Risk Management Departments. Providing a clear and consistent response to these inquiries is always our goal.

Our members occasionally ask “Who is covered under the municipality’s general liability plan and how does this plan define an employee? 

Who is covered? Any of the following are covered while acting within the scope of their municipal duties: any member of the municipal governing body, any elected or appointed official of the municipality, any member of boards and commissions of the municipality and any employee of the municipality, as defined in the agreement. 

Definition of Employee: OMAG’s plan mirrors the terms of the Governmental Tort Claims Act in defining the term “employee.” OMAG’s plan defines employee as "any person who has been authorized to act on behalf of the plan member whether that person is acting on a permanent or temporary basis, with or without being compensated, or on a full or part time basis. It includes all elected or appointed officers, members of governing bodies, and other persons designated to act for the plan member, but the term does not mean a person or other legal entity while acting in the capacity of an independent contractor or an employee of an independent contractor." 

Example: An independent contractor would be a person or company that the municipality hires to do a specific job, such as a local contractor to do a street project or an electrical company providing installation or repair. 

NOTE: You should always require the independent contractor to supply the municipality with a certificate of insurance. 

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K-9 Coverage

K-9 Coverage

The responsibility to respond to our members' coverage questions and provide coverage interpretation primary falls on OMAG’s Underwriting and Member Services Departments with support provided by OMAG’s Legal and Risk Management Departments. Providing a clear and consistent response to these inquiries is always our goal.

Our members occasionally ask, “Does the Municipal Liability Protection Plan provide coverage for our police department K-9s? And is there coverage provided when they are off duty?

The OMAG Municipal Liability Protection Plan does provide automatic general liability coverage for your K-9s while on duty. OMAG requires the K-9 and the handler to maintain their CLEET certification. 

One example of how our coverage might work would be: Let’s say the dog is trained to be passive in his response by barking or going on point to indicate he recognizes something, and damage occurs when he jumps on a vehicle. This damage would not be expected, as the normal passive response would not lead to any damage occurring. A third party can file a claim for their damages in this instance.

In another instance, if the dog is trained to respond to drug search in an aggressive manner (by jumping up onto the vehicle to indicate something has been found) and damages the vehicle, then the OMAG policy would not provide coverage.  In this case the officer should take measures (cover paws) if he knows that the dog will respond by jumping on the vehicle. This would be damage that would be expected or intended and is excluded on the policy.

When the K-9 is off duty and being kenneled, it is important to remember that the OMAG policy would respond to a claim filed for bodily injury or property damages only if the K-9 is being kenneled on city property. If the K-9 is being kenneled at a private residence, that individual’s homeowner’s policy would respond, should bodily injury or property damage occur. 

The OMAG policy does not provide coverage for animal mortality, but we do have a market that provides for that type of policy/coverage separately if you should be interested.  

Please contact Randy Stone, Underwriting Director, at (800) 234-9461 or rstone@omag.org if you have questions about this coverage or any other questions about the policies we offer.

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