1.Many “verbal” contracts are given and accepted on the job site. It turns out that, proprietary commercial general liability policies are now excluding covered losses if they arise out of any verbal contracts. Either check your policy form or get all contracts in writing no matter how minor.
2.Make sure that the “insured contract” exception to the employer’s liability exclusion preserves coverage for 3rd party action over claims. For example, this would provide coverage if a contractor’s employee was injured on a job site and filed suit on the project manager.
3.Your general liability policy most likely excludes mobile equipment if it is being towed or is permanently attached to the vehicle. Utilize an equipment floater policy, to protect yourself against this exposure.
4.Borrowed equipment and tools are typically excluded on both your general liability and property policies. Endorse it on your inland marine, C.O.C., or purchase a contractors equipment policy.
5.Be aware that faulty workmanship is excluded on ALL commercial general liability polices.
6.The job is considered a completed operation once it is “contractually completed” even though you may have corrections, repairs, replacements, services, or maintenance to perform.
7.Claim reporting obligations are daunting for smaller contractors and especially GC’s. A claim must be reported once there is “knowledge” of it, or it will not be covered. It is virtually impossible for a contractor to be fully aware of everything that transpires on a site and many incidents aren’t reported. Your broker should negotiate clarification of these definitions and have your insurance carrier put the discussion in writing, OR endorse an unintentional failure to disclose hazards.
8.For my residential contractors:
a.Make sure there is no designated work exclusion on your general liability policy. This will exclude completed operations coverage.
b.Ensure that there is no alienation of premises exclusion: this excludes coverage for property damage of premises that is sold by your company. I.e. you are buying and flipping homes.
9.Grading, excavation, foundation, and demo contractors:
a.Be certain that there isn’t total pollution exclusion on your general liability policy.
b.Remove any subsidence (earth movement exclusion)
c.Keep off (if possible) any X, C, U exclusions.
10.Things to endorse on your policies (or ask for)
a.Extended notice of cancellation: forces insurance carriers to give you at least 60 days of notice prior to canceling you. This will give you time to find another insurance company so there is no lapse in coverage.
b.Try to add as MANY additional insured’s as possible to a policy. General contractors – ask to be added to all of your subs polices.
c.On your umbrella policy: look at the definition of bodily injury to make sure that it picks up mental anguish.