How Public Insurers & Pools Can Positively Influence Police Operations

In the last few years, the Federal Department of Justice (DOJ) has reduced their involvement in case investigations and engaging practice consent decrees against local police departments. With that oversight being reduced, the role of public entity insurers and municipal pools has taken on a larger role.

Pools become experts regarding any litigation trends in their state, but they can also learn about changes taking place all around the country by having discussions with their excess or reinsurance carrier.

Civil rights claims grow every year. Without stronger tort caps and immunities, the costs and results of litigation rises. Premiums begin to go up and it becomes harder for an entity with budget issues to afford insurance or a pool membership. Many entities have limits around $10M, but with recent verdicts and settlements, higher limits of coverage seem to be needed. When an ultimate liability question is being debated, it is clearly known that a loss could result in damages awarded that could surpass an entity’s limits. It became hopeful that state and federal agencies would investigate ways to help reduce exposures.

Pools and carriers have threatened to cancel an entity’s liability insurance when that entity’s leaders, in coordination withpolice departments, face allegations of internal corruption. Of course, any internal problems that emanate from the police or elected officials will reach the media quickly. Pools and carriers do not want to be associated with any news involving internal corruption.

Internal corruption often results in employees filing suits that can sometimes take well over a million dollars to resolve. As soon as one employee’s suit succeeds, many other co-employees may join the litigation which can lead to a class action litigation. If an employee, especially a police employee, begins receiving negative publicity in the media, pools and insurers will pressure the entity to fire that person or will cancel their policy.

An entity’s loss of insurance coverage can become a huge problem for the police force. Recently, cities in several states disbanded their police departments after losing coverage and contracted with another entity’s department. Without insurance coverage, these large police-related claims can bankrupt municipalities that have other financial issues, especially smaller entities with a tight budget and smaller tax base.

Some pools and insurers are starting to request body cam usage, jail audits and updated procedural policies.Some also recommend that their clients provide better training and improve supervision in many different departments. There are organizations that concentrate in the areas requiring strong training. For instance, Lexipol helps police, fire and prison-related entities learn what is needed to improve. They will update their clients when National or State legislation makes changes that can have a large impact on their procedures.

Many states have required that police forces adopt new policies regarding areas like body cameras, strip searches and use of force. Many of these changes have come as a result of claims. When claims result in large exposures, pool and insurance carriers will make contact with the state government to ensure that the legislatures are made aware of changes that can result in their improvement.

Pools and carriers can also organize meetings with state governments to help revamp things. For example, most states have a 2-3 year statute of limitations (SOL) which limits the time a suit can be filed. In some states, the statute regarding police activity became set at a higher level. In Wisconsin, the police related statute was set at 6 years. A lawyer who was actively involved in police-related litigation put together a group of mutual “pool” representatives and insurance carriers to meet with the state to discuss their SOL. After a few meetings, the group was able to get the state to reduce that SOL to three years. This is a good example as to how a carrier or a pool can help the government improve litigation matters. A pool or a carrier will also meet with a town’s mayor or city council to get them to consider changing some local ordinances that can improve things.

Meetings are also held to encourage an entity to consider settling a case rather than take it to trial. Many, but not all, cases can be resolved before the trial date for a more reasonable amount than expected. If the case goes to trial and results in a large, highly publicized verdict, this can set a tough precedent for the entity and the entire state. Pools and carriers have to make sure that their messages are not sent as a political topic, which can limit a government’s attention.