A Hefty Price-Tag

Construction businesses pay a lot for insurance…perhaps more than any other industry.

Some firms go a full year without a single claim and wonder, ‘Why am I paying all this money?’

 

What does a claim look like?

Even the best, most safety-conscious contractors are vulnerable to a claim. In a litigious society, a seven-figure lawsuit can happen with one unfortunate-incident.

Below are claims examples for the various risk-exposures facing contractors.

 

Builders Risk Over the course of several months, a homebuilder was working with his team on a house. One night his equipment and building material was stolen. Because he properly stowed the items on the premises and had the right Builder’s Risk coverage, his claim was covered.
Auto Liability / Equipment An artisan contractor didn’t completely tie-down the equipment in his trailer. As he’s driving down a bumpy road, several pieces of equipment fall out, break, and damage another vehicle. Both the auto liability and equipment were appropriately insured, so the contractor was fully covered.
GL – Premises Liability A worker at a construction site gets his truck muddy. As he’s hosing it down, he receives a phone call and sets the hose down for a moment. A teenager rides his bicycle over the hose, skids on to the wet/muddy area, is thrown from the bike, and suffers a serious head injury.
GL – Completed Operations Liability A general contractor accepts a highway construction project. He hires a guardrail installer, and takes his insurance agent’s advice about requiring a Waiver of Subrogation in the contract. When, on that highway a few years later, a driver is injured due to the faulty guardrail, the general contractor is not held responsible for the claim.
Pollution Liability A general contractor was responsible for overseeing the renovation of a hospital wing. A patient died in the intensive care unit adjacent to the construction zone, and the patient’s cause of death was traced back to dust generated during demolition activities. The contractor was sued for negligent containment of the construction zone.
Professional Liability A design-build contractor designs the lighting fixtures for a large, upscale hotel. After completion, it becomes evident that the fixtures, which were produced overseas, do not meet UL standards. All fixtures must be replaced.
Workers Comp Overexertion is the most common Workers Comp claim according to a study from the Department of Labor. This injury occurs when a muscle is pulled, a ligament sprained, or a joint moves beyond its typical range of motion. If a construction worker, at the end of a long day, uses tired muscles and poor posture to lift a heavy item, there’s a good chance he will suffer an on-the-job injury.

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