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CGL Commercial General Liability

Contractor Insurance Requirements – A Primer

This article was originally published by AmWINS Group, Inc. It was edited and rewritten to simplify the content. To read the original article please click here.

primerWhen risk management department is assigned to focus on the major project, including construction, with particular attention to the insurance requirements to be imposed on the general contractor and any subcontractors, it’s very important not to make the insurance requirements so onerous that contractors are discouraged from bidding on the project.For those of us, who has not been involved in such projects before, let’s review insurance requirements from different projects and how those may affect our company (let’s call it ABC company – the one who impose insurance requirements).
Outdated Insurance Terminology
What may strike us about the old insurance requirements is the insurance terminology used. There is reference to “comprehensive general liability insurance” including endorsements listed as “broad form property damage,” “broad form blanket contractual liability,” “cross liability,” “XCU” and “additional named insured.” The limits are also listed as split limits – one applicable to bodily injury, and another lesser limit applicable to property damage.Similarly, the auto insurance requirement refers to “comprehensive auto liability” and workers’ compensation insurance includes the “broad form all states endorsement.” Further, all of the requirements are to be evidenced by a certificate of insurance that provides certificate holder a 30 days advance notice of cancellation. It becomes readily apparent that these requirements are so outdated as to be virtually useless – the coverage, endorsements and limits listed are obsolete and are no longer available. We must start from the beginning.Read More »Contractor Insurance Requirements – A Primer

Construction Defect Claims

Litigation over whether a Commercial General Liability insurance (CGL) policy provides coverage for faulty workmanship claims is rapidly evolving. Since 2012, six state supreme courts (CT, WV, ND, AL, GA, and OH) have ruled on whether faulty work can be an “occurrence;” whether the cost to repair the damage to the work constitutes “property damage”; how the “your work” exclusion and the subcontractor exception applies and whether providing such coverage converts a CGL policy into a bond. In addition, a few states have enacted legislation mandating CGL policies to define “occurrence” to include property damage resulting from faulty workmanship.

Of the six rulings, only the Supreme Court of Ohio ruled definitively against coverage, holding “claims of defective construction or workmanship brought by a property owner are not claims for ‘property damage’ caused by an ‘occurrence’ under a commercial general liability policy….” Westfield Ins. Co. v. Custom Agri Sys. Inc. 979 N.E.2d 269 (Ohio 2012)

Is Faulty Workmanship an Occurrence?

Although all of the rulings are nuanced, the other five states’ supreme courts have generally ruled that faulty workmanship can be an occurrence under the CGL policy. Rejecting the argument that faulty workmanship is foreseeable and therefore never fortuitous, the Supreme Court of Connecticut observed:

Read More »Construction Defect Claims

Insurance During the Course of Construction

Construction FireThis morning, downtown Los Angeles is on a massive fire.

The apartment tower that was under construction is burnt down to ashes. Other buildings surrounding it are heavily damaged.
When the fire department is finished, who is going to pay for damages?

First, the damage to the building under construction worth at least the cost of all the materials that are now gone. These are tens of thousands of dollars that the building owner has lost, UNLESS he had Builders Risk Policy in place. Builders risk policy, which is sometimes called Course of Construction policy will pay for the cost of materials lost due to the fire.

Second, what about the neighbor buildings that are damaged too? What if there are people injured (hopefully not)? This is the liability of the apartment building owner which could be tens of thousands of dollar too, UNLESS he had Owners and Contractor’s Protective liability Policy. This is a liability policy which pays for property damage (buildings burnt, roads and street lights damaged) and bodily injury (people injured or dead) that results because of owner-builder’s liability during the construction.Read More »Insurance During the Course of Construction

Additional Insured Endorsements – After the Work is Done

Additional_Insured_Endorsements_–_After_the_Work_is_DoneAdditional Insured – Completed Operations
How often the general contractor denies “blanket” additional insured, or CG 20 38 Additional Insured-Owners, Lessees or Contractors – Automatic Status for Other Parties When Required in a Written Construction Agreement? The problem is that in the construction contract between the general contractor and subcontractor, the subcontractor may be required to include the general contractor as an additional insured for completed operations coverage for a period of six years after the subcontractor’s work is finished. While the current “blanket” additional insured endorsement CG 20 38 does meet a portion of the insurance requirements – to protect the additional insured for certain bodily injury or property damage claims that take place during the project – the CG 20 38 specifically excludes any bodily injury or property damage that takes place after her customer’s work is finished.

And why in the world would a general contractor want to be an additional insured six years after the subs work is finished? Let’s review an example that shows the rationale behind completed operations coverage for an additional insured.

Example: A general contractor has been hired to remodel a building. Much of the work, such as HVAC, electrical, plumbing, and site preparation, is completed by trade subcontractors hired by the general contractor. Eight months after the building has been completed by the general contractor and put to use as an office space, a small fire breaks out in the mechanical room, injuring two workers of the office. When it is determined that the fire was the result of sloppy electrical work, the general contractor is sued by the injured people for bodily injury.

Additional Insured – Completed Operations CG2037
On the other hand, if the electrical subcontractor had listed the general contractor as an additional insured on its policy using CG2037 – Additional Insured – Owners, Lessees or Contractors – Completed Operations, the general contractor would have been covered as an additional insured by the electrical contractor’s CGL policy, provided the electrical contractor’s acts or omissions, at least in part, caused the bodily injury to the workers.Read More »Additional Insured Endorsements – After the Work is Done

Someone has to be responsible…

Butterfly EffectOften times our prospective clients tell: – “I wouldn’t worry about this…” or “I wouldn’t worry about that particular issue with my coverage… How likely people are going to sue me for something I should not be responsible for?”

Well, our answer is something most people are not going to like:

– In United States of America everyone with a slightest chance your operations/negligence/products have something to do with the accident or claim that occurred is to be found responsible.

For example,

Read More »Someone has to be responsible…

Anatomy Of Effective Craigslist Advertising

Your_ad_on_CraigslistWhen it comes to affordable advertising, your local Craigslist site has the potential to give you plenty of bang for your buck. In fact, many service oriented businesses depend almost entirely on the classified site for business. It’s free, it’s easy to update, and, for many businesses, it works for generating leads.
Like all aspects of your overall advertising plan, Craigslist marketing requires some forethought and strategy. That said, it shouldn’t be very time-consuming if done correctly: you can spend as low as 15 minutes a week on your Craigslist campaign.

Anatomy Of Effective Craigslist Advertising

Your Craigslist advertisement should include the following:Read More »Anatomy Of Effective Craigslist Advertising

Swimming Pool Safety and Maintenance Tips

Swimming pool safety and maintenance tipsProtect your friends and family as you beat the heat.

Warmer weather means more outdoor activities for the whole family, including cooling off in the pool. We want to help you make sure that you, your family and guests are safe. Here are a few tips that can help you stay safe while you have fun:

Always supervise swimmers and have life-saving equipment nearby:

  • Maintain secure fencing and a locked entrance around the pool and deck area to prevent access when adequate supervision is not available. Install self-closing and self-latching gates.
  • Make sure no one swims alone. Never leave a child unattended in the water or pool area, and make sure less experienced swimmers are always accompanied by a swimmer who has water life-saving skills.
  • Equip your door, gate or pool with an audible alarm to alert you if someone enters the pool area or falls into the pool while it is unattended.
  • Diving should be prohibited unless a specific area of the pool is designated for safe diving. Water depth and diving-restricted areas should be clearly marked.
  • Make sure there is adequate life-saving equipment in the pool area, including life preservers and a rope with life-saving rings, a reaching pole or rescue hook.

Regularly maintain your pool during the season to keep swimmers and sun-bathers safe:Read More »Swimming Pool Safety and Maintenance Tips

Insurance for Daycare and Preschool

daycare preschool insuranceWe offer coverage for residential and non-residential day care facilities for infants to kindergarten age children, and after-school child care through Grade 8. We can help provide immediate solutions to your unique day care insurance needs.

Coverages include:

  • Property
  • General liability
  • Abuse and molestation liability’
  • Educators legal liability
  • Day care services acts, errors or omissions
  • Corporal punishment liability
  • Automobile liability
  • Workers compensation
  • Umbrella liability

Let the professionals at Paperless Insurance work with you to customize a program that’s just right for you.
Read More »Insurance for Daycare and Preschool

Liquor Liability Insurance

Liquor Liability InsuranceAnd another terrible example of a liquor liability case: the family of a woman who died in a crash with a man suspected of driving while intoxicated is suing a Kaneohe bar, claiming the establishment improperly served him alcohol. The crash on June 30, 2012, killed Rene Nihipali of Honolulu. Investigators said a sport utility vehicle crossed the center line of Kamehameha Highway in Kaaawa and struck her pickup head-on. Her widower and two daughters last week sued Kralk Enterprises, which operates Club Komo Mai, the Honolulu Star-Advertiser reported. The lawsuit also names the other driver, Sione Glenn Tilini. The lawsuit says bar staff should have detected that Tilini was intoxicated when he was served alcohol. The lawsuit claims liquor served to Tilini was a direct cause of the crash. Two passengers in Tilini’s SUV also were injured.Read More »Liquor Liability Insurance

Museums and Cultural Institutions: Unique exposures

Goudi Building Museum

Your priceless collections and exhibits are what pull visitors through your doors. But keeping those visitors safe – as well as your employees, volunteers, building and reputation – is what keeps those doors open. Travelers has years of experience working with museums and cultural institutions. We understand your industry. We can help you with your insurance needs – from protecting your fine art collections, to covering your property risks to providing general liability coverage to workers compensation.

Fine art expertise

We offer Museums and Cultural Institutions customized product and service offerings. Our Inland Marine division is a Fine Art market leader that provides flexible solutions for your unique needs:

  • Local underwriting presence with fine art expertise
  • Broad, worldwide coverage at current market value
  • Coverage for exhibitions, loans and items while in transit
  • High capacity for high-value collections
  • On-site risk control consultations to help enhance facility and collection management
  • Dedicated fine art claim team committed to proper claim handling for unique valuable objects
  • Access to our Special Investigations Group who focuses on theft prevention and recovery of stolen property
One company for property exposures

Read More »Museums and Cultural Institutions: Unique exposures