Sec. 1. If a present or former public employee, including a member of a board, a committee, a commission, an authority, or another instrumentality of a governmental entity, is or could be subject to personal civil liability for a loss occurring because of a noncriminal act or omission within the scope of the public employee's employment which violates the civil rights laws of the United States, the governmental entity (when the governmental entity defends or has the opportunity to defend the public employee) shall, subject to IC 34-13-3-4, IC 34-13-3-14, IC 34-13-3-15, and IC 34-13-3-16, pay:
(1) any judgment (other than for punitive damages) of the claim or suit; or
(2) any judgment for punitive damages, compromise, or settlement of the claim or suit if:
(A) the governor, in the case of a claim or suit against a state employee; or
(B) the governing body of the political subdivision, in the case of a claim or suit against an employee of a political subdivision;
determines that paying the judgment for punitive damages, compromise, or settlement is in the best interest of the governmental entity. The governmental entity shall also pay all costs and fees incurred by or on behalf of a public employee in defense of the claim or suit.