Masonry Magazine April 1965 Page. 9
Insurance for Contractors
(continued from page 7)
The market was fairly limited to others. Insurance companies have caught up to this need; most will now automatically insure all such agreements, although some call for submission of contracts for examination within a stipulated time after execution to keep a check upon the degree of liability assumed and the premium developed to cover it. Occasionally, the agreements are so dangerous that immediate re-insurance is required. Some carriers may exclude only the very broad forms, but this is not recommended because it is difficult to decide which agreements fall into this category.
The trick now is to negotiate the lowest possible premium rates per $100 of contract cost based upon the number of agreements you sign and what is in them. Because there is nothing uniform about these indemnifying clauses, as well as a wide divergence of opinion concerning their seriousness, depending on which side of the fence you are on, this is a job for your insurance representative, whether the coverage is banklet or specific. Some underwriters are prone to interpret them from a pessimistic point of view, often developing a premium which reflects that pessimism unless rates are negotiated in your behalf.
D-Host Liquor Liability
In those states having strict dram shop laws, coverage is available by endorsement or separate policy to insure against any statutory liability arising from the giving or dispensing of liquor as a host. In Illinois, for example, a claim may be entered for bodily injury, property damage and/or loss of means of support. The only positive way to cover all three is through purchase of this insurance. Recommended if the entertaining of customers, employees, or associates ever involves in any way the giving or dispensing of liquor.
THE AUTHOR
Walter T. Derk is Assistant Vice President of the Fred S. James & Company, national brokerage firm with headquarters in Chicago. He has over 19 years of experience in the casualty insurance field and is one of the leading national speakers on this subject. Mr. Derk has lectured architectural classes at the University of Illinois on the subject of contract specifications and is the author of many comprehensive articles on insurance.
E-Explosion, Collapse or Underground Damage
When applicable under the basic Comprehensive Policy because work being performed involves classifications subject to one, two or all three exclusions, they may be removed entirely or for one specific project. The additional premium, normally a surcharge per $100 of payroll, is entirely dependent upon the physical hazards of the job.
To keep the cost down, tell your insurance representative everything you can learn about the site to be worked on, the steps you will take to prevent cutting into a telephone cable, gas main or other underground facility, the adequacy of blueprints to be followed, etc. Then, do everything possible to prevent such damage.
In some cases, removal of the x, c or u exclusions is fairly expensive, and the added cost should be determined before bidding on any contract which requires their removal. Recommended.
F-Broad Form Property Damage
This relatively new endorsement is designed to help answer at least one major question concerning the care, custody or control exclusion; just how much of the property being worked on is subject to the exclusion. Its reception to date has been mixed.
Intended primarily for contractors, the rider somewhat modifies this troublesome exclusion. It still excludes coverage in many of the situations excluded by the basic policy, but uses different and more specific language to do so, thereby covering without question some damage situations. For example, while continuing to exclude liability for damage to property being worked on, the endorsement deletes coverage only for that particular part, provided the accident occurs away from the insured's premises. Too, if a general contractor damages the property of a sub at the site of operations, no work being performed on it at the time, there may be no coverage under the basic policy, but there is under the Broad Form Property Damage Endorsement.
No doubt this extension will cover more claims without the necessity of going to court for a decision, but its full effect is still undetermined. Additional premiums required are subject to negotiation. Recommended if the price is right, so long the the contractor understands that it does not completely eliminate the care, custody or control exclusion itself.
G-Personal Injury
The first insuring agreement in the policy refers to bodily injury, which implies tangible physical injury. An extension is available to include Personal Injury (continued on page 26)