A. It shall be the duty of governmental entities to cover every risk for which immunity has been waived under the provisions of the Tort Claims Act or any liability imposed under Section 41-4-4 NMSA 1978 as follows:

(1) local public bodies shall cover every such risk or liability as follows:

(a) for a risk for which immunity has been waived pursuant to Sections 41-4-9, 41-4-10 and 41-4-12 NMSA 1978, the local public body shall cover the risk, and for any commercially uninsurable risk for which public liability fund coverage is made available, the local public body may insure the risk in accordance with the provisions of Section 41-4-25 NMSA 1978;

(b) for excess liability for damages arising under and subject to the substantive law of a jurisdiction other than New Mexico, including but not limited to other states, territories and possessions and the United States of America, the local public body shall provide coverage in accordance with the provisions of Subsection B of Section 41-4-27 [41-4-28] NMSA 1978, if coverage is available; and

(c) for a risk or liability not covered pursuant to Subparagraphs (a) and (b) of this paragraph, the local public body shall purchase insurance, establish reserves or provide a combination of insurance and reserves or provide insurance in any other manner authorized by law; and

(2) for state agencies, the risk management division shall insure or otherwise cover every such risk or liability in accordance with the provisions of Section 41-4-23 NMSA 1978. Coverage shall include but is not limited to coverage for all such liability arising under and subject to the substantive law of a jurisdiction other than New Mexico, including but not limited to other states, territories and possessions and the United States of America.

B. The department of finance and administration shall not approve the budget of any governmental entity that has not budgeted an adequate amount of money to insure or otherwise cover pursuant to this section or Section 3-62-2 NMSA 1978 every risk of the governmental entity for which immunity has been waived under the provisions of the Tort Claims Act or liability imposed under Section 41-4-4 NMSA 1978. The public school finance division of the department of finance and administration shall not approve the budget of any school district which has failed to budget sufficient revenues to insure or otherwise cover pursuant to this section every risk for which immunity has been waived pursuant to the provisions of the Tort Claims Act or liability imposed under Section 41-4-4 NMSA 1978.

C. No liability insurance may be purchased by any governmental entity other than as authorized by the Tort Claims Act.

History: Laws 1976, ch. 58, § 18; 1953 Comp., § 5-14-18; Laws 1977, ch. 247, § 52; 1977, ch. 386, § 15; 1978, ch. 166, § 3; 1979, ch. 287, § 4; 1979, ch. 392, § 2; 1981, ch. 268, § 1.

Bracketed material. — The bracketed material was inserted by the compiler to correct an apparently incorrect reference and is not part of the law.

Existence of insurance as waiver of immunity. — Without specific authorization by the legislature, the existence of insurance covering a governmental agency does not constitute a waiver of immunity from suit. Chavez v. Mountainair Sch. Bd., 1969-NMCA-060, 80 N.M. 450, 457 P.2d 382.

Where insufficiency of insurance not raised. — No question of immunity from suit existed where no claim was made that the insurance was insufficient to cover the amount of the verdict. Williams v. Town of Silver City, 1972-NMCA-132, 84 N.M. 279, 502 P.2d 304, cert. denied, 84 N.M. 271, 502 P.2d 296.

Two-year statute of limitations applicable to negligence suit involving public utility's employee. — Section 41-4-15 NMSA 1978 of the Tort Claims Act, allowing two years to bring suit, and not the one-year limitation of 37-1-24 NMSA 1978, which refers to the time for bringing suits in negligence against any city, town or village, or any officers thereof, applies to a suit for negligence of a public employee in the operation of a public utility. Cozart v. Town of Bernalillo, 1983-NMCA-053, 99 N.M. 737, 663 P.2d 713.

Law reviews. — For survey, "Torts: Sovereign and Governmental Immunity in New Mexico," see 6 N.M.L. Rev. 249 (1976).

Am. Jur. 2d, A.L.R. and C.J.S. references. — Liability or indemnity insurance carried by governmental unit as affecting immunity from tort liability, 68 A.L.R.2d 1437.

When does statute of limitations begin to run upon an action by subrogated insurer against third-party tortfeasor, 91 A.L.R.3d 844.