Accidents Involving Municipal Vehicles - Do Your Employees Know the Proper Actions to Take?

How does your municipality handle a vehicular accident when one of your employees is involved and operating a municipal vehicle? Being prepared and knowing what to do if this happens BEFORE it happens is key to promoting a successful outcome.

Do you have your employee contact their department supervisor? Police Department?  OMAG would certainly suggest a police report be filed, no matter how minor the accident. 

Do they know how to contact an ambulance service if needed?

Do they provide the information on your insurance verification card to the investigating officer?

Have they been advised to make no statement regarding fault at the scene?

Do they know how to assist the other party with the proper method to file a claim with the city?

If appropriate, do they take photos of the accident scene and all vehicles involved?

Are they advised not to make suggestions or recommendations on repair facilities? Making suggestions or recommendations on repair facilities can present uncomfortable situations if that repair facility does not meet the needs of the third party.

These things are very important to be sure that the investigation can be handled correctly. Regardless of whether the city employee feels they are at fault, a thorough investigation should take place to determine liability.  

If you have questions about how to handle a situation like this, or if you need help developing a plan, please contact Underwriting Director Chris Webb at cwebb@omag.org or Member Services Director Kyle Waid at kwaid@omag.org.

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.

Workers' Compensation Electronic Data Interchange (EDI)

Effective September 1, 2018, the Oklahoma Workers’ Compensation Commission (WCC) has mandated that all Workers’ Compensation claims data be sent to the WCC electronically.  This brings Oklahoma Workers’ Comp into the “paperless” arena so many other states or lines of insurance have already mandated.  The EDI mandate is that all employers, insurance carriers, and third-party claims companies file claims and data through an interchange, rather than using paper forms.   For employers, this means that you will no longer be required to submit a copy of the Form 2 (First report of Injury) to the WCC after an injury resulting in Lost Time.   However, it is imperative to note that these First Report forms must be sent to OMAG via its claims company, CBR, to initiate a claim.  The submission email address is still NewClaim@cbremail.com.   CBR will then send this First Report information to the WCC electronically.

 Going paperless should save the WCC manpower and costs, as they no longer must enter the claims by hand, and there will be a much greater compliance rate of submission.  However, there are several areas of concern for OMAG and its member municipalities:

 Fines for non-compliance or poor compliance are expected for employers, carriers, or claims companies.   First Reports of Injury are due to the WCC within 10 days of the date the employer was notified of the injury.  The WCC can levy fines for employers who do not send this information timely.   It is imperative that municipalities send the claim to CBR as soon as possible (preferably within 24 hours, but no later than 5 days).  CBR will send the claim to the WCC within 24-72 hours of receipt, provided all mandatory information is included in the report.

 A report card may be published by the WCC identifying employers, carriers and claims companies who do not send data in timely, or do not pay benefits timely.  A claim must be accepted, denied, or an extension requested within 15 days of employer notice.  Temporary Total Disability or Wages Paid in Lieu of must be started within 15 days of the first day of Lost Time. 

 The WCC is basically going to monitor the timely filing of claims and related information, and the prompt and accurate payment of benefits.  These were never monitored by the WCC in the past.

 OMAG’s claims company, CBR, is on top of these requirements and has been testing with their vendor and with the WCC for some time now.   CBR was fully compliant with the EDI mandate on September 1. 

 Please contact OMAG or CBR for more information.  CBR inquiries can be sent to info@cbremail.com.

Best Practices for Workers' Compensation Injuries

A municipality’s costs for workers’ compensation can be controlled and reduced by following a few Best Practices.

• Risk Management - consistent training is needed.  Most people have good and bad work habits and to prevent workplace accidents, the employer needs to focus on training away a person’s bad habits.  Success requires diligence and regular training by the employer.

• Timely report the injury - your OMAG adjuster is standing by to talk to the injured worker and help but they cannot get started until the claim is reported.  The Municipality’s goal should be to report the claim to OMAG within 24 hours of the incident.  Statistics prove that a delay in reporting a claim will increase the ultimate cost of resolving the claim.

• Preferred physician - Select a medical facility that will provide immediate medical treatment for any injured worker.   If an occupational clinic in your area is not an option, employers often choose an AM/PM Urgent Care facility to readily provide treatment.  The Emergency Room may be the best option in a rural area of the state, however the cost at the ER is 500% + more expensive than an Urgent Care.

• Return-to-work - when the doctor takes an injured worker off work while they heal, they may offer the employer the opportunity to return early if the employer can accommodate “temporary” work restrictions.  These may be as simple as restricting the amount of weight they can lift, or their ability to stand, crawl or bend.  Major benefits from accommodating work restrictions are:

  • Employee remains engaged and productive

  • The employer can monitor the healing progress and encourage the worker to attend doctor visits, physical therapy or other treatment

  • A smooth transition is in place for the return to 100% fulltime duties

  • Employee loses no pay so there is no financial hardship

  • Litigation is reduced since the injured worker maintains their job, pay and receives great medical care

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:

• 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

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. 

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 completed an appraisal project on all plants in 2020 through our partnership with a professional appraisal service. This was a five-year project targeted at appraising all of our members’ Water and Waste Water Treatment Plants. These professional appraisals were 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.

If you have any questions regarding your plants’ coverage or our professional appraisals of your plants, please contact Underwriting Director Chris Webb.   

What is a Bond, and Who Needs One?

What is a Bond: A bond is an obligation of the Surety (the company issuing the bond) to protect a person or entity (in this case your municipality or public entity) against financial loss caused by the acts of the principal (in this case your city official or employee).  

Municipal or Public Entity Positions to consider Bonding: There are essentially three types of municipal officials or employees serving the municipality or public entity:

First: the elected official who, although ultimately answerable in the political process for their performance, is a representative of those who have elected him or her and owes a duty to faithfully perform the functions assigned to them for the public good.

Second: public agents, or appointed officials, also share the responsibility of owing this special duty to their municipality or public entity. For the appointed official, the duty to faithfully perform emanates from the governmental powers reposed in the official. Power, authority and control would not exist absent the appointment to office.   

Third: the public employee, although serving for the public good, does not owe the same duty as the elected or appointed official. The public employee does not hold a special position of trust relative to the public, but instead owes a duty to his or her employer, in this case the municipality or public entity.

Bond Coverage vs. Your Municipal Liability Protection Plan (MLPP) Coverage:

Bonds serve a different purpose than coverage provided under your MLPP. Coverage under your MLPP protects the municipality or public entity from negligent acts of an elected or appointed official or public employee that could result in a third-party claim or suit. Bonds protect the municipality or public entity from a financial loss as a result of an improper or illegal act of an elected or appointed official or public employee.

What are the Types of Bonds Available:

There are numerous types of bonds available in the market. The most commonly used by a municipality or public entity are Fidelity Blanket Bonds, Fidelity Schedule Bonds, Public Official Individual Bonds, Public Official Schedule Bonds, and Public Official Blanket Bonds.

Fidelity Bonds: Statistics show a shocking increase in employee theft.  The only protections against this kind of loss are good internal control, regular outside audits and a Fidelity Bond. Fidelity Bonds are often referred to as “honesty insurance.” They cover loss due to any dishonest act of a bonded employee. The employee may steal alone or with others. The loss may be money, merchandise or any other property, real or personal. The Fidelity Bond is available in a group (blanket) or individual (schedule) form. These bonds are available in $5k, $10k, $25k, $50k, and $100k coverage amounts for periods of one and three years with the three-year bond provided at a reduced rate.

Public Official Bonds: For the public official entrusted with the handling of public funds, the primary purpose of the Public Official Bond is the protection of those funds from mismanagement and theft: Public Official Bonds guarantee taxpayers that the official will do what the law requires. A public official is expected to “faithfully perform” the duties of the office. Public Employee Bonds are also available for bonding the subordinates of the public official (those people who are not required by statute to be bonded). Those subordinates need to be bonded for dishonesty only.

Types of Public Employee Bonds and Coverages:

Individual Bond – Covers a single official for a specific amount.

Name Schedule Bond – Covers specific individuals for a stated amount in a schedule attached to the bond.

Position Schedule Bond – Covers specific positions for a stated amount in a schedule attached to the bond. 

Public Employee Blanket Bond – This bond covers all employees (except Treasurers, who are required to post individual qualifying public official bonds and cannot be covered by a blanket bond) unless specifically excluded.

Honesty Blanket Bond Coverage – Insures against loss sustained by the insured through any dishonest act committed by any of the employees. Recovery is limited to the bond penalty.

Honesty Blanket Position Bond Coverage – Insures against loss sustained by the insured through any dishonest act committed by any of the employees. The amount of coverage on each employee is the stated limit of liability.

Faithful Performance Blanket Bond Coverage – Insures against loss sustained by the insured through any dishonest act committed by any employees and failure to faithfully perform their duties or account properly for all monies to an amount not exceeding the stated limit of liability. Recovery is limited to the bond penalty.

Faithful Performance Blanket Position Bond Coverage – Insures against loss sustained by the insured through any dishonest act committed by any of the employees and failure to faithfully perform their duties.  The amount of recovery on each employee is the stated limit of liability.

Who is Required by Law to be Bonded:

Tit. 11 § 8-105. Certain officers to give bond

The municipal governing body shall require the municipal treasurer, any officer or employee designated by ordinance to sign municipal warrants or municipal checks, and any other officers or employees as the governing body may designate by ordinance, to give bond for the faithful performance of his/her duties within 10 days after his election or appointment, in such amount and form as the governing body shall prescribe. The municipality shall pay the premiums on such bonds.

Tit 11 § 1-102. Definition

“Officer or official” means any person who is elected to an office in municipal government or is appointed to fill an unexpired term to an elected office, and the clerk and the treasurer whether elected or appointed. When “officer” or “official” is modified by a term which refers to a personnel position or duty, the holder of the position or duty is not an officer or official of the municipality for any purpose.    

Tit. 11 § 27-111. Bond of clerk and judge

A.    The clerk of each municipal court shall give bond to the governing body of the municipality where the court is established. The bond shall be approved by the governing body and shall be in an amount to be fixed by the governing body. 

B.     The municipal governing body may provide that the judge, the alternate judge, and an acting judge, or any of them, shall give a bond to the governing body of the municipality where the court is established. If bond is required, it shall be in an amount to be fixed by the governing body. It shall be conditioned in the same manner as the bond that is required of the clerk of the court, and it shall be approved by the governing body.

Please contact the OMAG Underwriting Department for the appropriate application.

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.