UVa Seal

Policy: Insurance Coverage 

Date: 04/01/04 Policy ID: FIN-006 Status: Final

Policy Type: University
Contact Office: Risk Management
Oversight Executive: Executive Vice President and Chief Operating Officer
Applies To: Academic Division, the Medical Center, and the College at Wise.
Table of Contents: 

Policy Statement

  1. Property Coverage
    1. Personal Property
    2. Domestic or International Shipments
    3. Objects of Art or Antiques
    4. Equipment Breakdown
    5. Reporting Losses
  2. Liability Coverage
    1. Foreign Liability
    2. Errors & Omissions Liability
  3. Automobile Liability & Physical Damage Coverage
    1. Liability Coverage
    2. Physical Damage Coverage
    3. Personal Vehicles
    4. Rental Vehicles
  4. Professional Liability
  5. Aircraft Coverage
  6. Watercraft Coverage
  7. Workers’ Compensation
  8. Blanket Fidelity/Crime Bond
  9. Comprehensive Crime Policy
  10. Remote Access Telephone Fraud


Reason for Policy: The University of Virginia, for its own protection and for the protection of its employees and agents as well as the general public, maintains an umbrella of insurance protection as part of its risk management program. This policy describes the general types of coverage provided and the responsibilities of University employees.
Policy Summary: 
Definition of Terms in Statement: 
Policy Statement: 

The Office of Risk Management will administer the risk management programs for the University, including procurement of insurance and administering claims associated with the University’s risk management program. Coverages include general and professional liability, property damage, vandalism, theft, equipment breakdown, watercraft, aircraft, automobile liability and physical damage, telephone fraud, and other specialized insurance as may be necessary.

As a state agency, the University participates in certain insurance programs that are part of the State’s Risk Management Plan. The University’s Office of Risk Management will procure insurance or develop self-insurance programs that are not provided by the State Plan.

Employees are encouraged to call the Office of Risk Management to discuss any perceived risks that they may encounter throughout the University. The Risk Management program deals not only with insurance and claims, but also with coordinating attempts to prevent or reduce future losses. Additionally, the risk management staff reviews University contracts and agreements for insurance issues and other risk management concerns, and provides risk management advice to the University community.

Whenever any type of loss occurs, except those involving vehicles or injuries to employees while on the job, an Incident Report Form should be completed and faxed to (434) 982-2635 to the Office of Risk Management, hand-delivered to 2400 Old Ivy Rd. Suite 181, emailed to ORM-FRM@virginia.edu.  For incidents involving vehicles, an Automobile Loss Notice Form should be completed and sent to the Office of Risk Management. To report injuries to employees while on the job (Workers Compensation) contact the Human Resources Benefits Office. For vehicle incidents that involve employee injuries report to both the Office of Risk Management and Human Resources. [See procedures below.] For incidents involving Medical Center patients, contact the Medical Center’s Risk Management Office.

A brief outline of the coverages being maintained follows, but because of the complexity of the various coverages, it does not detail all of the exclusions and exceptions. To make inquiries concerning insurance coverage, to report any claims relative to bodily injury or property damage, or to report any other incidents that may result in financial loss to the University, contact the Office of Risk Management. BACK TO TOP

  1. Property Coverage:
    The State Division of Risk Management (DRM) has developed a Property Insurance Plan, which is comprised of self-insurance and commercial insurance. The Plan covers all State-owned buildings; contents; related contents and equipment on or off grounds; loss of business-related income; and in certain cases, extra expense incurred to expedite repairs. Since the Property Insurance Plan also includes coverage for Equipment Breakdown losses, this represents a combined program of coverage that will reimburse State agencies for repair or replacement of lost or damaged property from the perils of fire, lightning, windstorm, theft, flooding, sudden and accidental breakdown of machinery, and other causes (see Section 1.D Equipment Breakdown for more information).

    All State-owned buildings and contents are covered for repair or replacement, but all losses are subject to a departmental $1000 deductible. The department responsible for the property incurs the deductible. When multiple departments are involved in one loss, the deductible is shared by all departments involved, and must be paid from departmental funds. State and University procurement guidelines must be followed after the department files a claim to have property repaired or replaced. When a single loss exceeds the departmental deductible of $1000, the University will pay up to the next $99,000 for that loss. If a loss exceeds $100,000, the State insurance program begins to pay for the loss above the $100,000 threshold. BACK TO TOP

    1. Personal Property
      Personal property belonging to employees or students that is located on Grounds is not covered by State or University property insurance, unless their property is damaged through some negligence on the part of the University. It is strongly recommended that individuals having personal property at the University contact an insurance agent for appropriate insurance coverage, such as homeowners or renters insurance, to protect their personal possessions. BACK TO TOP

    2. Domestic or International Shipments
      The State’s Property Insurance Plan also insures State property, and in some cases the property of others, while located away from the University or in transit anywhere in the world with the exception of certain high-risk countries. Prior to the University's equipment or other property being taken out of the University, the following should be done:
      • Make a list of all applicable equipment;
      • Note each item's replacement value;
      • Note the locations the University property will be transported to;
      • Note the time period it will be away from the University;
      • Indicate how equipment will be safeguarded; and
      • Obtain documented approval from the dean or department head and send this information to the University's Risk Management Office.

      You may be contacted to discuss shipping and insurance issues for high value or sensitive equipment. Report all loss or damage of University property as soon as possible to the Office of Risk Management at (434) 924-3055 or (434) 924-3850. BACK TO TOP

    3. Objects of Art or Antiques
      The Office of Risk Management requires departments possessing objects of fine art or antiques to provide a full description of the object, its value with a valid appraisal when possible and the location of the item. Fine arts and antiques are covered at their appraised or stated value. Since a loss is more difficult to adjust with appraisals attempted after an article is damaged or stolen, it is strongly recommended that evidence of the replacement value of such items be obtained in advance and stored in an off-site location. BACK TO TOP

    4. Equipment Breakdown
      This is specialized coverage for the replacement or repair of such items as boilers; fired and unfired pressure vessels; refrigerating or air conditioning systems along with any piping and its accessory equipment; and any mechanical or electrical machine or apparatus used for the generation, transmission or utilization of mechanical or electrical power. There is coverage whenever there is a sudden and accidental breakdown of the items listed above or any parts of those items. At the time the breakdown occurs, it must manifest itself by physical damage to the object that necessitates repair or replacement.

      The Office of Risk Management should be notified within 24 hours of damage or loss. Departments are responsible for paying the deductible, which is the first $1,000 per claim. The University is responsible for the next $99,000 of loss. The State’s program of insurance begins to pay when a loss exceeds $100,000. BACK TO TOP

    5. Reporting Losses
      A completed insurance Incident Report Form must be sent to the Office of Risk Management within 24 hours of discovering any loss or damage to state property when it is anticipated the loss will exceed $1,000, or if the loss is caused by a third party. Additionally, all thefts must be reported to the University Police Department immediately.

      Prompt reporting and full documentation compliance will expedite recovery for losses incurred. Late reporting or delays in repair or replacement documentation can delay or forfeit reimbursement. Notice of loss must be made to the Office of Risk Management immediately upon discovery. BACK TO TOP

  2. Liability Coverage:
    Under the State Risk Management Plan, the Division of Risk Management administers a self-insured liability program, providing tort insurance coverage for the State, its agencies, and its employees and agents. A brief description of the coverage is provided below:

    The Plan will pay all sums, except as herein limited, or limited by the Code of Virginia, that covered parties shall be obligated to pay by reason of liability imposed by law for damages resulting from any claim arising out of acts or omissions of any nature while acting in an authorized governmental or proprietary capacity and in the course and scope of employment or authorization. The amount recoverable by any claimant with respect to the Commonwealth of Virginia, its departments, agencies, or any director, officer, employee or agent thereof, shall not exceed one hundred thousand dollars ($100,000) per claim. This limit shall not be applicable to any claim or causes of action other than those established by Virginia law. For claims or causes of action other than those established by Virginia law, the amount recoverable shall not exceed two million dollars ($2,000,000) per claim. The amount recoverable by any claimant with respect to officers, employees and agents of the Commonwealth of Virginia, including students while participating within the authorized scope of a clinical, internship, externship, or other educational program in order to meet pedagogical requirements … shall not exceed two million dollars ($2,000,000) per claim.

    All University operations conducted on University property, in owned and leased buildings, or at sites located away from the University are covered for authorized University business. This coverage is usually to provide protection for acts of negligence for which the University and/or its employees and agents may be held legally liable. It should be noted, however, that there may be no coverage if it is determined that liability was incurred by reason of (a) acts of fraud or dishonesty by the Covered Party, (b) acts of intentional, malicious or willful and wanton misconduct by the Covered Party, or (c) criminal acts. Defense for claims, suits, actions or other proceedings covered by this plan is provided under 2.2-507 et al of the Code. Additionally, claims, demands or other actions seeking relief or redress in any form other than monetary damages, including, but not limited to injunctive relief are not covered. Liability assumed under any written contract or agreement is also not covered. Report any incidents, accidents or unusual occurrences to the Office of Risk Management immediately. BACK TO TOP

    1. Foreign Liability
      Comprehensive general liability coverage is provided to faculty, staff and students performing activities on behalf of the University in foreign countries. It covers third party general liability claims for bodily injury and/or property damage, professional liability and automobile liability. Questions or reports of incidents should be directed to the Office of Risk Management. BACK TO TOP

    2. Errors and Omissions Liability
      The Board of Visitors and University officials, employees and agents are also protected against negligent acts or omissions which result in financial loss or damages to individuals or organizations that do not directly relate to bodily injury or property damage. Such acts or omissions usually result from decisions that are made by University representatives in their authorized capacity to do so which bring about allegations of damages incurred by a third party. BACK TO TOP

  3. Automobile Liability & Physical Damage Coverage:

    1. Liability Coverage
      Executive Order 89 (2005) requires that State-owned vehicles be used strictly for official business.  It also states: “Use of State-owned vehicles for commuting shall be authorized only when it is the most cost-effective or practical alternative, or as an employee’s job duties affecting public health, safety and emergency response may require.” State-owned vehicles are insured for liability coverage up to $2,000,000 per claim for this authorized use. This means people who use University vehicles in the scope of their employment or authorization to conduct University business are protected up to two million dollars for negligence resulting in bodily injury and property damage to third parties. The vehicle operator must comply with state travel regulations; notify the State Police or other authorized law enforcement organization as well as the authorized claims administrator (CAPSTONE); and cooperate fully in the investigation, defense or settlement of any claim or suit.  Failure to provide such notice or to comply with state travel regulations will constitute a material breach of the Plan and could result in denial of coverage. Also, individuals will not be covered for acts of intentional, malicious, willful and wanton misconduct, or criminal acts in the use of a vehicle. The Plan will defend any claim, suit, action or other proceeding relative to any loss or other occurrence that may be covered under this plan.

      Note: Report any incident or accident involving State owned or leased/rental vehicles used on University business to the State Police immediately (call University Police if accident occurs on Grounds) and to CAPSTONE (1-866-729-9655) – identify yourself as an employee of the Commonwealth of Virginia. An Auto Loss Notice must be submitted to the Office of Risk Management within 24 hours of an accident. Occupants’ personal possessions are not covered by this insurance if lost or damaged in State vehicles.

    2. Physical Damage Coverage
      With regard to physical damage coverage, the University maintains a combination insurance/self-insurance program to pay for damages to University owned vehicles. Departments have the option of insuring their vehicles in this program if the actual cash value of the vehicle is less than $5,000. However, all vehicles valued at $5,000 and above must be insured through the University’s self-insurance program to pay for damages to these vehicles. The department having responsibility for the vehicle must pay the first $1,000 of loss for each claim. A description of accident procedures should be located in each State vehicle (see “note” under the Liability section 3.1 above). BACK TO TOP

    3. Personal Vehicles
      When an employee of the University is driving his or her personal vehicle on University business, the State’s automobile insurance plan applies only after the limits of liability on the employee’s personal auto policy have been exhausted. The State policy, however, does not apply toward physical damage to personal vehicles. Individuals should have physical damage coverage, such as comprehensive and collision, on their personal vehicles if they want insurance coverage for damages they may incur. BACK TO TOP

    4. Rental Vehicles
      When an employee of the University is driving a rental vehicle on University business, the State’s automobile insurance coverage applies only after the rental agency’s liability coverage is exhausted. The University's self-insurance program will respond to physical damage incurred by leased vehicles. Starting on 7/1/07, vehicles will be covered through a combination of self-insurance and the State’s LeaseCare program. The department having responsibility for the vehicle must pay the first $1,000 of loss for each claim. Procurement & Diversity Supplier Services may have contractual arrangements with rental agencies that include coverage for physical damage to the rental vehicle with no departmental deductible. Use of credit cards providing coverage for damages to rental vehicles, such as the University travel and purchasing cards, when used to book and pay for vehicle rentals is a potential source of coverage for rental vehicle damage including the $1,000 departmental deductible. However, use of a credit card to pay for damage to a rental vehicle will jeopardize coverage through the State or University's coverage programs.

      Employees should not buy additional insurance offered by the car rental agency if on University business because its purchase is not reimbursable. However, this does not apply to leasing vehicles in a foreign country. When leasing vehicles in another country, except for Canada, it is advisable to purchase liability and physical damage insurance at the time the vehicle is rented. Purchasing insurance in the foreign country where the vehicle is to be used makes the handling of automobile claims much easier. (This vehicle insurance cost will be reimbursable when leasing vehicles in foreign countries.)

      If an accident occurs in a rental car, immediately call the police, the rental agency and CAPSTONE (1-866-729-9655). The driver should indicate that he or she is an employee of the Commonwealth of Virginia. An Auto Loss Notice should be faxed to (434) 982-2635 to the Office of Risk Management, hand-delivered to 2400 Old Ivy Rd. Suite 181, or emailed to ORM-FRM@virginia.edu. Contact the Office of Risk Management with coverage concerns when renting vehicles or driving state vehicles in a foreign country. BACK TO TOP

  4. Professional Liability:
    Health care professionals, residents, house staff and health care professional students are provided medical malpractice coverage for those acts or omissions arising out of the course of their employment or authority. Per the Virginia Code (Section 8.01-581.15), the medical malpractice cap on July 1, 2008 increased to $2,000,000, and on July 1, 2012 increased to $2,050,000 with annual increases of $50,000 ending with the July 1, 2031 increase to $3,000,000. The July 1, 2013 increase will be the medical malpractice cap, unless new legislation is passed in the future. Coverage is not provided for non-University activities, nor is coverage provided to medical faculty under contract with the University to bill for services through the University of Virginia Physicians Group.

    Report all medical incidents or potential malpractice claims arising out of Medical Center Operations immediately to Medical Center Patient Safety & Risk Management (reference Medical Center Policy 132 for further information for reporting such incidents). BACK TO TOP

  5. Aircraft Coverage:
    The University maintains aviation liability insurance on its owned aircraft to cover bodily injury and property damage for up to $25,000,000 per occurrence, including passengers (excluding employees covered by workers’ compensation), arising out of the ownership, maintenance or use of its aircraft. Owned aircraft are also insured for all risk physical damage coverage to the aircraft. BACK TO TOP

  6. Watercraft Coverage:
    The University maintains marine insurance to provide hull and related equipment coverage to pay for physical damage to its owned watercraft over 26 ft. in length that are licensed to operate in open waters. BACK TO TOP

  7. Workers’ Compensation:
    Workers’ compensation provides statutory coverage for employees’ injuries during the course of their employment. The Department of Human Resources administers the program and questions should be directed to that department’s Benefits Office. Questions regarding workers’ compensation for employees in the Medical Center should be directed to Medical Center Employee Relations. BACK TO TOP

  8. Blanket Fidelity/Crime Bond:
    The Blanket Fidelity/Crime Bond is a State insurance program. Employee dishonesty is considered to be a criminal act committed by an employee acting alone or in collusion with others. There must be a manifest intent by the employee (a) to cause the Commonwealth to sustain a loss and (b) to obtain a financial benefit for the employee or someone the employee seeks to benefit. Coverage protects against loss of money, securities and property other than money and securities. Coverage for dishonest acts applies to all officials and employees of the Commonwealth. The bond limit is $500,000 and the University maintains two million dollars ($2,000,000) of excess insurance. Notify the University Police, the University Internal Audit Department and the Office of Risk Management within 24 hours of discovering a loss. BACK TO TOP

  9. Comprehensive Crime Policy:
    The State program covers the University’s loss of money, securities or checks by actual destruction, disappearance, forgery or wrongful abstraction (robbery or theft), either on premises or in transit. The policy does not cover failure of employees to provide faithful performance or employee dishonesty (see section 8, Blanket Fidelity/Crime Bond). There is a $1,000 deductible per claim, which is the responsibility of the department incurring the loss. The limit of crime coverage provided by the State Plan is $300,000 per loss. The University maintains excess crime insurance in the amount of $2,000,000. Notify the University Police, the University Internal Audit Department and the Office of Risk Management within 24 hours of discovering a loss. BACK TO TOP

  10. Remote Access Telephone Fraud:
    The University maintains Telephone Fraud insurance coverage for those situations where unauthorized individuals gain access to the phone system from a remote location in order to gain access to outgoing long distance telephone service, which results in a financial loss to the University. The maximum this policy will pay in any policy year is $300,000. There is a $10,000 per claim deductible with a maximum per year deductible of $30,000. Report all claims or potential clams immediately to the University Police, the University Internal Audit Department and the Office of Risk Management. BACK TO TOP

7-80 "Completing Insurance Incident Form"
7-81 "Completing Automobile Loss Notice"
7-82"Reimbursing Housing Resident Claims"


Related Information: Office of Fleet Management Services, OFMS Policies and Procedures, see Section 1: General
Policy Background: 
Major Category: Finance and Business Operations
Category Cross Reference: 
Next Scheduled Review: 05/03/13
Approved By, Date: Policy Review Committee, 04/01/04
Revision History: Updated 10/8/12, 4/8/11, 5/3/07, 8/25/06, 9/2/05, 5/15/05.
Supersedes (previous policy):  Risk Management Program VII.H.1