Torrance Shifts Insurance Policy

In response to several expensive losses from lawsuits filed against the city, Torrance has beefed up its liability protection and has voted to issue a $3-million bond to replenish the reserves depleted by those losses.

The Torrance City Council on Tuesday voted to purchase a new insurance policy covering liability losses up to $5 million, with a deductible of $2 million. Coverage includes losses involving negligence on the part of police officers, as well as personal injuries and property damages for which the city is liable. This would supplement the city’s existing policy, which the council voted to renew Tuesday. The existing policy covers losses up to $10 million, with a $5-million deductible.

By voting to issue a 10-year, $3-million bond, or Certificate of Participation, the city will replenish its liability reserves and incur a debt of about $450,000 a year, plus interest, said Kenneth Flewellyn, assistant finance director. The bond does not have to be approved by voters.

Kathy Keane, assistant to the city manager, said the liability reserve is needed to cover the deductibles of the insurance policies.