Minnetonka Council approves $49,986 AIG cybersecurity policy with $5 million incidental coverage

On Oct. 20, 2025, the Minnetonka City Council voted to accept a cybersecurity insurance quote from AIG totaling $49,986 annually to supplement the city’s existing coverage.

City staff told the council the purchase is intended to fill limits in the City’s current policy and to provide incident response, legal and public-relations support and additional employee training. “AIG’s proposal includes $5,000,000 in incidental coverage plus complimentary services,” a city staff presenter said. The council approved the motion on a 7-0 roll call after a brief discussion of cost and funding.

Why it matters: city staff said cyberattacks are a growing risk for local governments and noted that the city’s League of Minnesota Cities Insurance Trust policy has limits that can be small for phishing and ransomware incidents. Staff said the Trust’s change in 2023 capped some phishing losses at $50,000, while overall costs from recent municipal incidents have exceeded those limits.

What staff proposed: Staff presented three supplemental quotes obtained through the city’s broker: AIG at $49,986 annually; TMHCC at about $60,000; and Coalition at about $90,000. The AIG proposal included the highest incident limits and bundled services staff considered important: additional employee cybersecurity training, security assessments, vulnerability scanning, incident-response support and public-relations and legal consulting.

Funding and financial details: The premium will be paid from the city’s insurance trust fund, an internal fund that pools departmental contributions and pays premiums and deductibles. City management explained that the trust fund currently has adequate balance to cover the premium for 2025–26 and that departments budget for insurance contributions that flow into that fund. Staff estimated the annual cost at $49,986 and emphasized that members of the council asked whether the $5 million limit was sufficient; staff replied the broker recommended $5 million but cautioned an incident could exceed that amount and that the city is also setting aside CIP dollars as an additional cushion.

Council discussion and vote: Council member Foster Bolton moved to accept the AIG quote; Council member Wilburn seconded. Council member Calvert, who said she had experience with a cyber incident in her role with another city, supported the purchase and praised the supplemental services. The motion passed on a unanimous roll call.

What the policy does not do: Staff emphasized the insurance purchase supplements—but does not replace—ongoing prevention work, including employee phishing simulations and training that the city already performs.

Next steps: Staff will finalize procurement with AIG and implement the complementary training and assessment services as part of the policy package.