CIRSA’s Law Enforcement Coverage Explained

By Sam Light, CIRSA General Counsel

Introduction.  With the recent passage of Colorado Senate Bill 20-217, the Enhance Law Enforcement Integrity Act (“SB 217”), we’ve been getting a lot of questions from CIRSA members about liability coverage for peace officers and their municipal employers.  After all, SB 217 creates a new state cause of action against peace officers for constitutional violations, as well as a new state cause of action against public entities for an alleged pattern and practice of constitutional violations.  And, the natural question is: “Are we covered for this?”

While there are many unanswered questions of how these new causes of actions will be handled by the courts, this article is intended to speak to this basic coverage question by providing an overview of CIRSA’s existing law enforcement coverages.  This article summarizes the framework of CIRSA’s liability coverages, focusing on coverage for “law enforcement activities,” and provides some comments on claims handling for the new civil liability causes of action created by SB 217.

Editor’s Note:This article is for informational purposes only and provides only a general summary of coverages that are available to CIRSA members.  Nothing in this article is intended to affect CIRSA coverage or create any legal rights or obligations.  The information herein does not constitute a coverage determination with respect to any claim, and all coverages are governed by the terms, conditions, limits, and exclusions stated in the applicable coverage documents.  This article is not to be relied on as a substitute for review of those documents.

Coverage Limits.  CIRSA members who participate in the CIRSA Property/Casualty Pool receive liability coverages under the CIRSA Liability Lines Aggregate Coverage Form.  Part I of the Coverage Form includes Law Enforcement Liability (“LEL”) and General Liability coverages for claims arising from “law enforcement activities.”  Under the 2020 Coverage Form, the LEL coverage limit is $10,000,000 each “claim” subject to the member’s chosen deductible.  For state tort claims subject to the Colorado Governmental Immunity (“CGIA”)—for example, a claim of civil assault against a peace officer—coverage is capped at the dollar limits on liability recoverable under the CGIA.

Who is a Covered Party?  Covered parties under CIRSA’s liability coverages include, in pertinent part, the CIRSA “Member”—e.g., your city or town—and any elected or appointed official, officer, employee, or volunteer of a Member while in the performance of his or her duties for the Member and within the scope of his or her employment by the Member.

Thus, for example, where an alleged victim of excessive force brings a claim against an officer and its employer for a use of force on the job, the LEL and General Liability coverages are designed to respond with coverage for the officer and the municipality.  This is true whether the claimant pursues a tort claim under Colorado law alleging negligence, assault, battery, etc., or a federal civil rights claim pursuant to 42 U.S.C. § 1983 alleging excessive force in violation of the Fourth Amendment.  Historically, this is how excessive force cases have been pled.

What Law Enforcement Activities are Covered?  Diving a bit deeper into coverage details, the scope of your CIRSA LEL coverage extends to sums the covered party—i.e., your entity or officer—becomes legally obligated to pay as “ultimate net loss” because of “law enforcement activities.”  Most pertinent, this last phrase is defined to mean activities while acting within the scope of duty as a law enforcement officer or reserve officer which result in bodily injury, property damage, or personal injury, or in the violation of civil rights.  The term also includes a few other categories of activities.[i]

Additionally, where a law enforcement case involves constitutional claims against the employer—for example, based on its alleged failure to train or supervise or similar allegations—your entity’s Public Officials Liability (POL) coverage may extend coverage.  CIRSA’s POL coverage (Coverage Part II of the Coverage Form) extends coverage for alleged “wrongful acts” arising out of the discharge of duties by or on behalf of the CIRSA Member.  This “wrongful acts” coverage extends to actual or alleged violations of the U.S. or state constitution, or any law affording protection of civil rights.  This POL coverage does not extend to the injury claims asserted against the officers undertaking “law enforcement activities”—as those fall under the General Liability and LEL coverages—but instead applies to other theories of recovery, such as failure to train or an alleged pattern or practice of constitutional violations.

Exclusions and Limitations.  Importantly, as with all liability policies and as the above discussion suggests, CIRSA coverages are subject to certain exclusions and limitations.  In particular, while coverage generally extends to law enforcement activities resulting in a violation of civil rights, it does not extend to civil liability for criminal acts.  Specifically, General Liability and LEL coverage is excepted “for civil liability of an individual arising out of a criminal act for which the individual has been convicted.”  And, while coverage does extend to the use of force while in the course/scope of employment by public safety officers to protect persons or property, an exclusion applies where the conduct is “deemed to be willful and wanton or a criminal act.”

In addition, CIRSA coverages do not include coverage for any punitive or exemplary damages.  As noted by the Colorado Supreme Court, the public policy of Colorado prohibits an insurer from providing insurance coverage for punitive damages.[ii]

In claims handling practice, where an excessive force claim is asserted against a peace officer, these and other coverage provisions are initially addressed though a “reservation of rights” letter issued at the outset of litigation.  By such a letter, CIRSA will inform the covered parties of the various coverage terms, conditions, limits, and exclusions that apply to the claims as pled in the lawsuit, commonly with some initial analysis regarding the potential exclusions to coverage.  Where coverage is provided, the reservation of rights letter serves to confirm that CIRSA will provide a defense, reserving its rights to decline coverage should one or more exclusions later become applicable.

Senate Bill 217 Liability.  As discussed in CIRSA’s recent Law Enforcement Liability Alert, SB 217 creates a new cause of action against a peace officer for deprivation of rights secured by the Colorado Bill of Rights (Article II of the Colorado Constitution).  Municipal employers will be required to indemnify a peace officer for any settlement or judgment, unless the peace officer was criminally convicted for the conduct giving rise to the claim, or unless the employer determines that the officer did not “act upon good faith and reasonable belief that the action was lawful.”  Under the latter scenario, the peace officer will be responsible to pay a portion of the settlement or judgment out of his or her own pocket, limited to the lesser of $25,000 or 5% of the judgment or settlement.  But, if the officer is unable to do so, the city or town will be required to pay the full amount.

Among the questions we received is whether CIRSA’s existing coverages extend to this new SB 217 cause of action against peace officers.  In short, the answer is yes, subject to the terms, conditions, limits, and exclusions in the coverage documents.   As noted above, covered law enforcement activities include those which result in bodily injury, property damage, or personal injury,[iii] or in the violation of civil rights.  The new SB 217 cause of action against peace officers for deprivation of rights “under color of law” is, at root, a state civil rights claim.  Thus, your CIRSA liability coverages as outlined above are likely triggered for a SB 217 constitutional claim, though a specific coverage determination can only be confirmed within the context of the specific claim.

Senate Bill 217 Personal Liability.  Another question we have received is whether CIRSA’s existing coverages extend to an officer’s personal liability under SB 217.  In short, the answer is it depends, and a few points regarding this personal exposure are of note.  First, to the extent this new exposure arises from a criminal conviction, it falls within long-standing and common insurance exclusion for liability arising from criminal acts.

Second, where SB 217 provides new potential for personal exposure for other conduct, this new exposure arises upon a determination by the employer that the officer did not “act upon a good faith and reasonable belief that the action was lawful.”  If the employer makes no such determination, then it appears this personal liability is not activated.  On the other hand, if the employer makes such determination and the officer’s conduct was not willful and wanton or criminal, then those coverage exclusions would not apply.

Third, while there are many unsettled questions about the personal liability provisions of SB 217, in practice, claim handling of cases with personal liability exposure is nothing new at CIRSA.  After all, peace officers and other public employees already face risks of personal liability, whether under the CGIA for willful and wanton conduct or under 42 U.S.C. § 1983 for punitive damages.  In these tough cases, unless an exclusion clearly applies at the outset—for example, a criminal conviction has already been entered—CIRSA’s practice is provide defense under a reservation of rights.  And, in these tough cases, CIRSA’s works closely with its covered officers to resolve such cases in the most appropriate manner, be it through dispositive motions, settlement where appropriate, or a vigorous defense through trial.

Senate Bill 217 Entity Liability.  Finally, as noted above, SB 217 creates a new state cause of action against public entities for an alleged pattern and practice of constitutional violations.  More specifically, it authorizes the Colorado Attorney General to bring a civil action to obtain “any and all appropriate relief” to eliminate such a pattern or practice of constitutional violations by the entity’s officers or other officials or employees.  The entity must be given notice and up to 60 days to change its ways or eliminate the asserted pattern or practice before a civil lawsuit may be filed.

As with all coverage determinations, whether CIRSA coverage will apply to this new claim for entity liability will depend upon the specifics of the case.  For example, if the Attorney General’s action seeks money damages for alleged “wrongful acts,” your entity’s POL coverage would apply, subject to the terms, conditions, limits, and exclusions for that coverage.  On the other hand, if the Attorney General’s action seeks no money damages and only a court order requiring the alleged pattern and practice cease, then your entity’s POL coverage would not apply as that coverage, with a few exceptions, is limited to claims seeking money damages.

Conclusion.  As you’ve certainly concluded from just this summary, insurance issues and coverage documents can be complex!  And details matter: Whether there is coverage in any specific matter will depend heavily upon the particular facts and circumstances.  And, as with all insurance, they are limits and exclusions that could come into play—for example, liability from criminal acts and punitive damages aren’t covered.  But, in simple terms, your existing CIRSA liability insurance coverages are designed specifically to provide protections for CIRSA members and their peace officers for potential liabilities arising from law enforcement activities.  And, with over 35 years of unparalleled experience in handling police liability matters for cities and towns across the state, CIRSA has the expertise to assist its members inappropriately resolving police liability claims.

If your entity participates in CIRSA’s liability coverage program and you receive a notice, demand or suit asserting a claim under SB 217, then as with all liability claims, be sure to promptly submit the matter to the CIRSA Claims Department so that the matter can be reviewed with respect to potential coverage and claims handling under your CIRSA law enforcement liability coverage.

 

[i] The full definition of “law enforcement activities” under the 2020 Coverage Form is as follows:

“Law enforcement activities” means activities:

  1. While acting within the scope of duty as a law enforcement officer or reserve officer;
  2. While acting within the scope of duty as an officer of a jail;
  3. While acting within the scope of duty as an “employee” or official representing a law enforcement agency; or
  4. By an officer, “employee,” or official identified in a., b., or c. above, while acting within the scope of “moonlighting activities,”which result in “bodily injury,” “property damage” or “personal injury,” or in the violation of civil rights, except for civil liability of an individual arising out of a criminal act for which the individual has been convicted, which is not covered.

[ii] See, e.g., Lira v. Shelter Insurance Co., 913 P.2d 514 (Colo. 1996).

[iii] “Personal injury” is a defined term as well within the Coverage Form and means, in pertinent part, injury, other than bodily injury, arising out of certain listed offenses, including “violation of civil rights, but only with respects to “law enforcement activities,” except for civil liability of an individual arising out of a criminal act for which the individual has been convicted, which is not covered.”  “Personal injury” also includes offenses such as false arrest, detention, or imprisonment; malicious prosecution, and false or improper service of process.

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