When the clock struck midnight this morning, the president of the Sykesville town council resigned. So did the three members of the zoning appeals board. The mayor said he'll hang in a bit longer, but he won't do much besides sign paychecks for town employes.

In a world full of lawsuits, the officials of this Carroll County town of 2,000 about 30 miles north of Washington didn't want to take their chances without insurance. The town's liability insurance for public officials expired at midnight, and they could not find anyone to renew it, so the officials notified their colleagues in a letter that they would resign effective at midnight.

"It wouldn't happen overnight -- it would take years -- but I could lose everything I own," said council President Charles H. (Tim) Ferguson, a retired resident of the city, explaining why he quit.

Sykesville Mayor Lloyd R. Helt Jr., who is a lawyer, said he told the town's public officals: "Your individual assets are at stake here after last night -- as of 12:01 this morning. You ought to be aware of it, and you ought to consider resigning."

Helt said he will resign, if he cannot get insurance soon. For now, he said, "the only thing I'm doing is day-to-day services. No major decisions are going to be made. No building or development contracts. We're trying to cut our vulnerability. Whether we can do that by omission, I don't know, but we are safer, I think, than by commission." Public services such as utilities and police are not affected because they were on separate policies.

The Sykesville resignations may be unique, he said, but the problem is not. Insurance carriers around the country have jacked up liability insurance premiums for towns and municipalities, or have stopped dealing with them.

According to a recent survey by the Maryland Municipal League, towns and cities in the state have seen liability insurance rise this year an average of 81 percent for automobiles, 113 percent for public officials, 180 percent for excess coverage, 48 percent for police and 72 percent for comprehensive general insurance.

Annapolis, according to the study, paid $41,000 for bus insurance last year, and is paying $241,000 this year. Salisbury has lost its zoo insurance. Baltimore saw its property liability premium go up from around $350,000 a year to $1.7 million a year.

Jack Daly, a spokesman for the Hartford Insurance Group in Connecticut, whose agents declined to insure Sykesville's officials, said the municipalities' insurance problems stem largely from the reduction in price competition among insurance companies that has allowed premiums to rise, increasing value of jury awards, and new insurance burdens such as pollution liability.

Mayor Helt, however, blamed federal and state government over-regulation for the most part. It has created such a mess of potential lawsuits, he said, that it's little wonder insurance rates run high. Few of the regulations are relevant to a small town with a $400,000-a-year budget, he said:

"What we are saying is: 'Government, stop giving us these 80-page ordinances. Every 80-page ordinance increases our vulnerability. And we don't have the staff to digest these things.' "