Orange Cty. Water Dist. v. Ass'n of Cal. Water Agencies Joint Powers Ins. Auth.

In this case we are asked to consider whether a public entity self-insurance pool, formed by several water agencies pursuant to a joint exercise of powers agreement, is “insurance” subject to a commercial insurer’s policy provision that its coverage will not apply until all “other insurance” is exhausted. Because the statutes authorizing creation of public entity self-insurance pools specifically provide such arrangements are not to be considered insurance (Gov. Code, § 990.8, subd. (c)), we conclude the “other insurance” clause is not applicable and affirm the judgment.

In 1979, the Orange County Water District (OCWD) and several other water agencies entered into a joint powers agreement (the JPA) which created the Association of California Water Agencies Joint Powers Insurance Authority (the ACWA-JPIA). The ACWA-JPIA was created under section 6500 et seq., authorizing the joint exercise of power by two or more public agencies; section 990.4, providing that public agencies may insure themselves against tort or other liabilities and may do so through self-insurance and/or purchase of commercial insurance; and section 990.8 which authorizes two or more public entities to…