What is Contractor General Liability?
The main function of Contractor General Liability Insurance is to protect business owners and operators against lawsuits which may arise from the following:
In a Nutshell
Contractor General Liability Insurance is primarily used as a safeguard against third party lawsuits arising from Bodily Injury and/or Property Damage incurred by the negligence of a Contractor (your business entity) or an employee. These potential lawsuits may arise when the Contractor’s negligence has resulted in Bodily Injury, Property Damage or Personal/Advertising Injury sustained while a construction operation is ongoing or many years after the project has ceased or been completed.
Why do I Need it?
Contractor General Liability is the “go to” insurance coverage when something goes wrong at the job site. It’s the basic coverage that will protect you and your company when the worst possible thing can happen. Yes, you’re an experienced contractor, you follow the rules carefully and you take safety very seriously. So, why do you need it? In two words: Defense Costs.
Not only will your Contractor General Liability policy respond if you or your company is found to be liable for causing bodily injury or property damage, but the policy provides for Defense Costs. Lawsuits, although tried on fact, are typically filed based on “Perception”. This simply means that a lawsuit can be filed based on a simple notion that someone is “perceiving” they were done wrong, not that they actually were.
Your Contractor General Liability policy will pay your Defense Costs (legal fees) anytime an action is filed against you or your company whether frivolous or not. Every lawsuit file must be answered by an attorney and that can become very expensive, very quickly. Your Contractor General Liability policy pays the attorney fees for you! No scrambling around to find a qualified attorney you can afford – you simply call your claims department and the insurance company will take it from there so you can get back to work and focus on what matters most, making money!
What does it Cover?
Your Contractor General Liability will provide coverage for a host of different risks including:
*This coverage is triggered and responds if you are considered liable for an injury caused to a 3rd person-
*This coverage kicks in if you or your employee cause damage to another person’s property in the course of your service.
*This will be the most important coverage required by your General Contractor. This coverage will pay if an action is brought against you for faulty workmanship provided by you or your company. In many cases these claims may arise long after your work was completed so it is important to never let your coverage lapse.
*Medical payments can almost considered being a gift from the insurance company. This coverage will pay without proof of liability and will pay quickly on your behalf.
*This is one that many don’t realize even exist in a CGL policy. This triggers a variety of different coverages above and beyond the typical physical damage claims one may expect from General Liability coverage.
What is the difference between an Admitted vs. Non-Admitted Carrier?
An Admitted Carrier follows state guidelines for insurance providers, while non-admitted carriers operate without submitting to state requirements.
The benefits of an Admitted Carrier is that its liabilities are backed up by state finances. If the carrier is to go bankrupt the state will use money from a designated fund to pay the claims for the policyholders once the carrier becomes insolvent. California’s designated fund is known as “CIGA” (California Insurance Guaranty Association)
The benefits of a Non-Admitted Carrier (aka Surplus Lines Carrier) is that the company often has more underwriting authority to write a broader scope of coverage because of the unrestricted rate structure Admitted Carriers are required to follow by the state, thus leaving Non-Admitted carriers a large financial surplus and the ability to write specialty coverage for risks such as General Contractors, Roofers and Demolition Specialist.
What is an Additional Insured?
An Additional Insured (AI) is a person or organization not automatically included as an insured (you) under an insurance policy who is included or added as an insured under the policy at the request of the named insured.
This is the most common endorsement requested on the standard CGL policy.
At Fairbanks Insurance Brokers most General Liability policies written with us will come with a standard (CG 20 10 07 04 or Equivalent) Blanket Additional Insured endorsement Free of Charge.
What about Certificates of Insurance?
Certificates of Insurance (COI) are a very important factor in the negotiation process that is often overlooked by a consumer while shopping for a commercial insurance policy. Most Brokers fail to disclose to at the time of purchase that an agency may charge upwards of $100 per Certificate of Insurance in addition to any needed endorsements depending on the type of risk doing the work and the scope of operations performed for the project owner.
Free of Charge
At Fairbanks Insurance Brokers we live by three golden rules when it comes down to Certificates of Insurance:
*Scheduled endorsement requests from the carrier requiring special wording may take longer depending on complexity and the verbiage required on the forms being requested-
What are my Payment Options?
We at Fairbanks Insurance Brokers have a variety of different payment options to choose from when it comes to purchasing your General Liability Policy.
Why choose Fairbanks Insurance Brokers?
At Fairbanks Insurance Brokers, our focus of expertise lies solely within the Construction community. The personal relationships we’ve developed over many years, working with the nation’s best insurance providers, has granted us unprecedented access to the most competitive wholesalers, which allows us to save contractors thousands of dollars annually, resulting in the lowest rates fit for any residential or commercial risk.