Minot Implements New Insurance for Water and Sewer Backups

Homeowners in Minot may face financial burdens if damage from backups in city-owned water or sewer lines occurs without city fault. To address these concerns, the City of Minot explored an optional insurance policy aimed at easing these costs for residents.

The North Dakota Insurance Reserve Fund (NDIRF) introduced a rider with adjustable coverage levels, receiving unanimous approval from the Minot City Council on July 6. This endorsement provides up to $25,000 in coverage for water and sewer backups, regardless of city negligence, supplementing homeowners' existing insurance. Coverage amounts include $10,000, $25,000, and $40,000, with premium rates set at 15%, 22.5%, and 30% of the general liability premium, respectively.

City staff favored the $25,000 coverage level, which costs around $50,290 or approximately 31 cents per month per account. Currently, this expenditure is covered by water/sewer reserve funds.

Council member Stephan Podrygula suggested homeowners include water and sewer backup coverage in their home insurance policies, highlighting that the city's rider might not cover all damage scenarios. Council member Mike Blessum added that certain incidents could remain uncovered.

Eligibility for coverage stipulates that the utility backup must be tied to a city utility. Finance Director David Lakefield commented on the newness of the product, indicating uncertainty regarding future demand and costs.

Furthermore, the council allocated $85,000 to identify lead and copper water service lines, anticipating a federal mandate in late 2027 for their replacement. A contractor is set to identify about 2,200 lines. Additionally, discussions are ongoing with 120Water for services including line tracking and lead material notifications. Advanced modeling from 120Water, costing $35,000, could potentially eliminate the need for 20-40% of physical inspections on unidentified lines, offering a saving of over $2 million, backed by a partially forgivable state loan and reserve funds.

Additionally, the council accepted a grant to enhance pedestrian safety by upgrading crosswalk signals with modern overhead flashing beacons at strategic locations. They also approved a Transit Development Plan from the Central Dakota Metropolitan Planning Organization.