(A) Prior to beginning any construction in or installation of permittee's facilities in the public right-of-way, permittee shall obtain insurance as set forth below and file certificates evidencing same with the city. Such insurance shall be maintained in full force and effect until the end of the term of its franchise agreement or pre-existing agreement, (whichever is then in effect). In the alternative, permittee may satisfy this requirement through a program of self-insurance, acceptable to the city, by providing reasonable evidence of its financial resources to the city. The city's acceptance of such self-insurance shall not be unreasonably withheld.
(B) Insurance requirements are as follows:
(1) Commercial general liability insurance, including completed operations liability, independent contractors liability, contractual liability coverage, railroad protective coverage and coverage for property damage from perils of explosion, collapse or damage to underground utilities, commonly known as XCU coverage, in an amount not less than $5,000,000.
(2) Liability insurance for sudden and accidental environmental contamination with minimum limits of $500,000 and providing coverage for claims discovered within three years after the term of the policy. Pursuant to the 2006 MPSC decision in Case U-14720, permittee need not comply with the preceding sentence until such time after the effective date of this chapter that it decides to place any new or existing facilities underground within the public right-of-way in the city.
(3) Automobile liability insurance in an amount not less than $1,000,000.
(4) Workers' compensation and employer's liability insurance with statutory limits, and any applicable federal insurance of a similar nature.
(5) The coverage amounts set forth above may be met by a combination of underlying (primary) and umbrella policies so long as in combination the limits equal or exceed those stated. If more than one insurance policy is purchased to provide the coverage amounts set forth above, then all policies providing coverage limits excess to the primary policy shall provide drop down coverage to the first dollar of coverage and other contractual obligations of the primary policy, should the primary policy carrier not be able to perform any of its contractual obligations or not be collectible for any of its coverages for any reason during the term of the franchise agreement or pre-existing agreement (whichever is then in effect), or (when longer) for as long as coverage could have been available pursuant to the terms and conditions of the primary policy.
(C) The city shall be named as an additional insured on all policies (other than worker's compensation and employer's liability). All insurance policies shall provide that they shall not be canceled, modified or not renewed unless the insurance carrier provides 30 days prior written notice to city. Permittee shall annually provide the city with a certificate of insurance evidencing such coverage. All insurance policies (other than environmental contamination, workers' compensation and employer's liability insurance) shall be written on an occurrence basis and not on a claims made basis.
(D) All insurance shall be issued by insurance carriers licensed to do business by the State of Michigan or by surplus line carriers on the Michigan Insurance Commission approved list of companies qualified to do business in Michigan. All insurance and surplus line carriers shall be rated A+ or better by A.M. Best Company.
(E) If the insurance policies required by this chapter are written with retainages or deductibles in excess of $50,000, they shall be approved by Manager in advance in writing. Permittee shall indemnify and save harmless the city from and against the payment of any deductible and from the payment of any premium on any insurance policy required to be furnished under this section.
(F) Permittee's contractors and subcontractors working in the public right-of-way shall carry in full force and effect commercial general liability, environmental contamination liability, automobile liability and workers' compensation and employer liability insurance which complies with all terms of this section. In the alternative, permittee, at its expense, may provide such coverages for any or all its contractors or subcontractors (such as by adding them to permittee's policies).
(G) Permittee's insurance coverage shall be primary insurance with respect to the city, its officers, agents, employees, elected and appointed officials, departments, boards, and commissions (collectively "them"). Any insurance or self-insurance maintained by any of them shall be in excess of permittee's insurance and shall not contribute to it (where "insurance or self-insurance maintained by any of them" includes any contract or agreement providing any type of indemnification or defense obligation provided to, or for the benefit of them, from any source, and includes any self-insurance program or policy, or self-insured retention or deductible by, for or on behalf of them).
(Ord. 959, passed 11-8-10)