Police Departments: Insured Or Not?

Police departments can carry insurance to protect against financial loss in the event of litigation. Law Enforcement Liability Insurance provides coverage for bodily injury, personal injury, or property damage caused by a wrongful act committed by or on behalf of a public entity while conducting law enforcement activities. While most agencies are not required to pay punitive damages for an officer, they may choose to do so if the officer acted in good faith. The likelihood of an individual officer facing personal liability is slim, but it is possible. In recent years, there have been proposals to make personal liability insurance mandatory for police officers as a way to hold them accountable for reckless behaviour.

Police brutality

In the United States, marginalized groups often perceive the police as oppressors due to the disproportionate number of minority incarcerations. Police brutality can be linked to a collective failure of the criminal justice system, poor police training, and a lack of legal repercussions for officers who use excessive force. Social issues such as racial discrimination and poverty can also exacerbate the problem.

International laws and standards govern how and when police can use force, particularly lethal force. The UN Basic Principles on the Use of Force and Firearms by Law Enforcement Officials (BPUFF) is the key international instrument. Under international law, police officers should only use lethal force as a last resort to protect themselves or others from imminent death or serious injury when other de-escalation options are insufficient. However, many killings by police worldwide do not meet these criteria.

To address police brutality, civil society organizations have advocated for police reform, including limiting the use of lethal force, collecting data on police killings, conducting thorough investigations, and ensuring accountability for human rights violations. Body-worn cameras have been introduced as a potential tool to increase police accountability, although their effectiveness has been questioned due to a lack of transparency in withholding footage from the public.

Police departments and individual officers can obtain law enforcement liability insurance to mitigate financial losses from lawsuits arising from negligence, failure to protect, false arrests, or civil rights violations. While most agencies are not required to pay punitive damages, individual officers may seek additional protection through professional liability insurance, although finding coverage can be challenging given the nature of the profession.

Civil rights violations

Police departments and officers can face civil rights violation claims, which can lead to costly litigation. Law enforcement liability insurance is designed to protect police departments and officers from financial loss in the event of civil rights violation claims. This type of insurance provides coverage for civil rights violations under any federal, state, or local law. It is important to note that the insurance company will provide a legal defense for the insured until a determination or admission of wrongdoing is made in a legal proceeding.

While most agencies are not required to pay punitive damages for officers, many statutes allow the agency to indemnify the officer if they independently find that the officer acted in good faith. In rare cases, individual officers may face personal liability if they act with malice or engage in criminal conduct. However, in general, the agency will be responsible for providing a legal defense and paying damages, excluding punitive damages.

The balance of rights between lawbreakers and law enforcement has shifted, making it easier for criminals and suspects to bring suits against law enforcement. This has resulted in an increase in litigation costs, which can be devastating to municipal budgets. Additionally, new legal interpretations and liberalizations of the Civil Rights Act have broadened the scope of liability.

To mitigate financial loss, police departments can purchase professional liability insurance, which provides coverage for acts, errors, and omissions that occur while officers perform their professional duties. This type of insurance helps protect municipalities, counties, and transit authorities from the financial burden of litigation. It is worth noting that defense expenses are typically paid outside of and in addition to the limits of insurance coverage.

Lawsuits and settlements

Law enforcement liability insurance provides coverage for bodily injury, personal injury, or property damage caused by a wrongful act committed by or on behalf of a public entity while conducting law enforcement activities or operations. Police officers and their departments can face claims of negligence, failure to protect, false arrests, or civil rights violations. These suits can lead to costly litigation, and while many cases do not result in settlements or judgments, all have to be defended, which can be devastating to municipal budgets.

The high cost of settlements over police misconduct has led insurers to demand that police departments overhaul their tactics or forgo coverage. Insurers are now successfully dictating changes to tactics and policies, and the movement is driven by the increasingly large jury awards and settlements that cities and their insurers are paying in police use-of-force cases. The settlements also help those who are exonerated and then face being released back into society with little or nothing, especially in states without any compensation fund for wrongfully convicted persons.

Insurers are now refusing to provide initial coverage unless police departments change their policies on a variety of matters, including body cameras and chokeholds. Departments with a long history of large civil rights settlements have seen their insurance rates shoot up by 200 to 400 percent over the past three years, and even departments with few problems are experiencing rate increases of 30 to 100 percent. Now, insurers are also telling departments that they must change the way they police.

In the United States, more than $1.5 billion has been spent to settle claims of police misconduct involving thousands of officers repeatedly accused of wrongdoing. Minneapolis paid $27 million to the family of George Floyd, and Louisville paid $12 million to Breonna Taylor's family. However, the median amount of the payments is $17,500, and most cases are resolved with little or no publicity.

The typical payout for cases involving officers with multiple claims—ranging from illegal search and seizure to the use of excessive force—was $10,000 higher than those involving other officers. Despite the repetition and cost, few cities or counties track claims by the names of the officers involved, meaning that officials may be unaware of officers whose alleged misconduct is repeatedly costing taxpayers.

Insurance costs

Police departments can take out law enforcement liability insurance to cover bodily injury, personal injury, or property damage caused by a wrongful act committed by or on behalf of the department while conducting law enforcement activities or operations. This includes the ownership, maintenance, or use of premises, providing first aid, moonlighting, and liability for law enforcement key coverage features. The cost of insurance for police departments will vary depending on the insurance provider and the level of coverage required.

The balance of rights between lawbreakers and law enforcement has shifted, with courts making it easier for criminals and suspects to bring suits against law enforcement. This has resulted in an increase in lawsuits, which can be financially devastating for municipal budgets, even if there is no settlement or judgment. Police departments may also face claims of negligence, failure to protect, false arrests, or civil rights violations, which can lead to costly litigation.

In addition to insurance provided by the department, individual police officers can purchase their own professional liability insurance. The cost of this insurance will depend on the deductible limits applied and can vary from $500 to $1000 annually. However, finding professional liability insurance as an officer may not be easy due to the nature of the profession, which includes arresting people and using force.

One proposal to hold reckless police officers accountable is to make personal liability insurance mandatory for individual officers. This proposal suggests that insurance companies could assess premiums based on risk algorithms, similar to how insurance works for drivers. If an officer engages in reckless or dangerous behavior, their premiums would increase, and they could be priced out of policing. However, this proposal has faced pushback from powerful police unions, who want to be immunized from any financial or job responsibility for dangerous policing.

Police immunity

The concept of qualified immunity was introduced by the United States Supreme Court in 1967 in the case of Pierson v. Ray, where it was initially intended to protect police officers from financial liability. Over time, the scope of qualified immunity has been expanded by the Supreme Court, making it more challenging for victims of police misconduct to seek justice and compensation.

Qualified immunity allows state and local officials to avoid personal consequences for their actions unless they violate "clearly established law". This means that for a victim of police misconduct to successfully sue an officer, they must demonstrate that the officer's conduct was unlawful and that the officer should have known they were violating the law because a similar case had already been decided upon in court. This creates a "Catch-22" situation, as it becomes increasingly difficult to meet the required standard without sufficient precedent.

While the odds of an individual officer facing personal liability are slim, there have been efforts to reform or abolish qualified immunity. Some states, such as Colorado, have passed legislation to impose personal liability on officers found to have acted in bad faith. However, the impact of these efforts is limited as qualified immunity is enshrined in federal law.

To mitigate the financial risks associated with litigation, police departments often carry law enforcement liability insurance, which provides coverage for bodily injury, personal injury, or property damage caused by wrongful acts committed during law enforcement activities. This insurance helps protect municipalities and counties from the financial burden of lawsuits, ensuring that police departments can continue to serve and protect their citizens.

Frequently asked questions