Masonry Magazine March 1967 Page. 7
Insurance For Contractors
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 no uniformity in these indemnifying clauses, as well as a wide divergence of opinion about their seriousness, depending on which side of the fence you are on, this is a job for your insurance representative, whether the coverage is blanket or specific. Left to their own devices, some underwriters are prone to interpret them from a pessimistic point of view, often coming up with a premium which reflects that pessimism unless rates are negotiated in your behalf.
It is important to point out that even Blanket Contractual Liability coverage is subject to certain exclusions, some of which can be removed or amended by negotiation. A review of those exclusions, most of which are comparatively obscure, is recommended.
B-Host Liquor Liability
In those states having strict dram shop laws, coverage is available by endorsement or separate policy to insure against 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.
C-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 or negotiated flat charge, is 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 exclusion is fairly expensive, and the added cost should ideally be determined before bidding on any contract which requires their removal. Recommended.
D-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 has been good.
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.
This extension without doubt covers more claims without the necessity of going to court for a decision. Additional premiums required are subject to negotiation. Recommended if the price is right, so long as the contractor understands that it does not completely eliminate the care, custody or control exclusion itself. (See discussion of Installation Floaters.)
E-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 Liability, that is, intangible harm. Commonly written in three divisions, these include:
1-False Arrest
Malicious Prosecution
Willfull Detention or Imprisonment
II-Libel
Slander
Defamation of Character
III-Wrongful Eviction
Invasion of Privacy
Wrongful Entry
The endorsement commonly excludes claims brought by employees, advertising activities and such liability assumed under contract. The additional premium required is variable, being much more expensive to a hotel or store owner than to someone having no apparent exposure. Recommended where exposure to such claims may exist and, again, the price is right.
F-Fire Legal Liability
This endorsement bypasses the exclusion of property in the care, custody or control of the insured only as respects buildings or portions thereof rented to or occupied by the insured and designated in the endorsement, covering the insured's legal liability for such property if accidentally damaged by fire. The practical purpose here is to insure the tenant against subrogation claims brought by the owner or his fire insurance carrier for fire damage caused by the tenant's negligence.
The same thing can be accomplished under fire forms by eliminating the subrogation clause as respects the tenant or by issuing a fire policy in his name. The usual charge for this endorsement is 25% of the building fire rate per $100 of insurance purchased.
G-Vendor's Liability
The manufacturer of a material or product may purchase Products Liability Insurance to protect himself against bodily injury or property damage claims resulting from its use after sale. He may also endorse his policy to protect those who sell his manufactured product, either individually or or a blanket basis, from contingent liability claims arising from such sale. Although final responsibility may accrue to the maker, this optional vendor's endorsement assures the seller