Defense of State Employees and Insurance


The NC Defense of State Employees Act (N.C.G.S. §143-300.3 et seq.) provides for the defense, representation and indemnification of state employees who are acting within the course and scope of their assigned duties and are sued in their official or individual capacities, whether criminally or civilly. The NC Attorney General has the sole discretion to decide whether to defend. An employee must request representation. The Attorney General may refuse to defend you, if: a) the act or omission is not within the scope and course of employment (e.g. you committed sexual harassment); b) you committed fraud, corruption or acted with actual malice; c) there would be a conflict of interest with the State; or d) it would not be in the best interests of the State.

Power Point on Lawsuits and Liability

Preparing for E-Discovery

University officers, employees and agents (not independent contractors) are provided with personal liability coverage for acts or omissions that occur within the course and scope of their authorized work. These protections are defined by statute as well as the terms of the insurance policy. Personal liability coverage for university employees is provided in two layers: 1) the State self-insurance program in accordance with the NC Tort Claims Act; and 2) excess liability coverage and limits pursuant to the Defense of State Employees Act. Coverage limits are $2 million per individual, $2 million per occurrence, and $10 million annual aggregate. Exclusions include, but are not limited to, fraud, corruption or actual malice, sexual assault, other criminal acts, immoral acts, and automobiles (coverage provided under motor pool insurance). Other approved insurance exists for motor pool coverage while driving state vehicles on university business by employees.

As a constituent institution of the University of North Carolina and a state agency, NCSU is a self-insured entity as required by and set forth in state law (N.C.G.S. §143-291, et seq.). The university is not allowed to acquire additional or other insurance except by authorization and procurement by the State Department of Insurance (N.C.G.S. §58-31-55). Subject to and consistent with applicable statutes, coverage under the State’s self-insurance program applies to: a) all individuals currently employed by or working for the State and covered by the Defense of State Employees Act; b) authorized volunteers; c) agents of the State; d) individuals previously employed by the State and covered under the Defense of State Employees Act and the policy during their period of employment with the university; and e) individuals employed by NC State or the University system. Independent contractors are not employees of the State or the university.

3D Memo Employee Excess Liability Insurance 2018 (pdf).

For more information and answers to frequently asked insurance questions, see this link: