The city attorney and finance office briefed council on March 8 about trends in claims, litigation and insurance costs and urged attention to rising liability and compliance costs.

City Attorney Lawson (title in transcript) and interim Finance Director Sharif Edmond said that claims and litigation values have increased since the pandemic, even when the number of claims remains similar. The city attorney's office noted that litigation activity rose after courts reopened and that the city now faces higher defense and settlement costs.

The city's excess coverage (insurance above the city's self‑insured retention) has increased sharply in recent years. Finance staff told council that a single upcoming renewal could raise the city's excess coverage cost from roughly $5.6 million to about $9.1 million — a reported increase of about 38% — with additional uncovered costs below the deductible expected to add another $2–3 million per year for handling claims and settlements that fall beneath insurance thresholds.

Lawson and finance staff emphasized that these increases are driven by broader market forces — higher national jury awards, wildfire and cyber risk, and insurer pricing — and that the trend is industry‑wide. They said the city is engaged with insurance markets and risk pools and continues to explore mitigation strategies but advised council the pressure on insurance budgets is significant and may affect FY26 planning.

Council members asked about advocacy channels, the city's participation in pooled insurance arrangements and steps staff can take to control liability, including policy and procurement changes. Staff said they will continue coordinating with the city's risk pool and Cal Cities on advocacy and noted that some liability costs remain below the city's insurance layers and therefore require annual budget allowance.