Masonry Magazine January 1968 Page.25
WHAT
NOT COVERED.
by Walter T. Derk-MCAA Insurance Consultant
A series of articles composed of a concise summary of principal hazards excluded or omitted from the newly revised liability insurance policies. Designed to bring the fine print into better focus.
This installment concludes the series, What? Not Covered! We hope that the material covered has been beneficial in some way to our members and the readers of MASONRY. Any inquiries pertaining to the subjects discussed in the series should be directed to Mr. Derk at MCAA's headquarters in Chicago.
POLICY EXCLUSIONS
Exclusions appearing in Umbrella policies are relatively simple, most being confined to:
(1) Assault and battery committed by or at the direction of the insured.
(2) Intentional property damage.
(3) Damage to property owned by the insured.
(4) Workmen's Compensation, unemployment or similar benefits law liability.
(5) Damage to the insured's product itself.
(6) Damage to the insured's work.
(7) Loss of use of any such defective products or work.
(8) Improper or inadequate performance, design or specification in the absence of personal injuries or tangible damage to the property of others.
(9) Advertising claims from
(a) failure of performance of contract,
(b) trademark or trade name infringement,
(c) incorrect description of an article or commodity.
(d) mistake in advertised price.
(10) Nuclear facility hazards.
(11) Liability as a consequence of war, invasion, hostilities, civil war, rebellion, insurrection, etc.
MAINTENANCE OF UNDERLYING
INSURANCE
Umbrella policies carry a schedule of underlying primary liability insurance maintained by the insured, and the insured warrants to keep such insurance in force during the Umbrella term. Failure to comply with this condition does not invalidate the policy, but the carrier's responsibility then extends only to the same extent as would apply if the insured had maintained such coverage. It is therefore properly stated here as a limitation or condition of Umbrella coverage.
FOLLOWING-FORM EXCESS
LIABILITY
By way of endorsement underwriters may restrict their policies so that Umbrella coverage applies to certain specific hazards only to the same extent that they are covered by underlying primary insurance. That is, if covered in the underlying policies Umbrella will cover too; otherwise not.
This is pure following-form excess liability insurance as respects such enumerated hazards.
"IN ITS ENTIRETY"
During the course of a business day we encounter any number of requests for "full coverage" or certificates of insurance attesting to contractual liability covering a hold-harmless agreement "in its entirety." This may be the ideal time to say once and for all that there is no such thing.
Such phrases are unfortunately in general use, but are most often encountered in contract specifications where well-meaning people insert them in an effort to achieve the broadest possible protection for their clients. The very length of this concise booklet devoted to exclusions, limitations and omissions in a few standard policies is one indication of how far they are from such a goal.
Even so-called "all-risk" policies are limited in scope and are inevitably subject to numerous policy provisions, definitions, conditions and exclusions. Doubters need only examine their own insurance contracts to become convinced of the futility of insisting upon certification of unlimited coverage from others.
The common solution when encountering such all-inclusive phrases is to strike them out on the typewriter or to add a sentence indicating that coverage is subject (Please turn page)
25