The act caps at specified dollar amounts the liability exposure of local governments for tort claims. Every policy or insurance contract purchased by a governmental entity must provide these minimum coverage amounts. The caps (or minimum coverage amounts) in the chart below apply in each accident.

Governmental vehicles may be considered uninsured motor vehicles. However, the applicable limits of liability for cities for claims arising out of the operation of a government vehicle are equal only to the limits of T.C.A. § 29-20-311, T.C.A. § 56-7-1201(d), and T.C.A. § 56-7-1202(b).

The law is comprehensive, but it does not affect certain statutes. Any action in eminent domain initiated by a landowner (inverse condemnation) under T.C.A. § 29-16-123 and T.C.A. § 29-16-124 is explicitly exempted from the caps. T.C.A. § 29-20-105. Similarly, the caps do not apply to any action brought by an employee under Tennessee’s workers’ compensation laws. T.C.A. § 29-20-106.