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Written by:
Steven D. Davis
- pricing of the Umbrella/Excess Policy.
- Pollution exclusions are typical in CGL policies. Certain specialty markets will provide broadened coverage for the exposures of contractors.
- Residential restrictions are becoming more common. Each insurance company defines “residential” differently. Some define residential as hotels, dormitories, prisons, etc. They do not restrict the definition to a single family home or condo unit. If a contractor’s work involves apartments or other work considered “residential,” this can be a significant restriction of coverage.
- Employee Benefit Liability coverage is important to include in the program.
- Blanket waivers of subrogation will normally be required by owner contracts. Negotiating this upfront will provide an advantage.
- A blanket additional insured endorsement will normally be required by owner contracts. Get this done upfront to save time and money during the year.
- Residual wrap-up coverage can be important for contractors who perform work under either Owner Controlled or Contractor Controlled Insurance Programs. This will provide coverage to the contractor after the wrap-up coverage’s completed operations term has expired.
Coordinating coverages between the primary CGL and the Umbrella/Excess is becoming more vital in today’s market. Exclusions and definitions are easily used for coverage denials under the Umbrella/Excess programs, despite coverage being granted under the CGL policy.
For further details, refer to Patrick J. Wielinski’s books, Insurance for Defective Construction, available at IRMI’s website, and Contractual Risk Transfer: Strategies for Contractual Indemnity and Insurance Provisions.
