Your subcontractor’s employee is injured on a jobsite. He collects Workers’ Compensation benefits under his employer’s policy, but files a liability claim against you, the general contractor. Will your Commercial General Liability (CGL) policy cover the claim?
The CGL policy excludes injuries to your employees. Because the injured worker is the subcontractor’s employee, not yours, your unendorsed CGL policy will provide coverage for the claim. Sometimes, though, the policy is amended. This is most likely to be the case if your policy is written by a carrier that is not an admitted insurance company, although it is wise to check all policies, regardless of the type of carrier.
One of the most common ways that insurance companies eliminate coverage for claims such as this is to redefine employee. Some companies change the definition to include your employees as well as any independent contractors, and employees of independent contractors. With this type of amended definition, the Employers’ Liability exclusion now applies, and you have no coverage if a sub’s employee is hurt.
Some insurers don’t redefine employee, but do amend the Employers’ Liability exclusion to apply to employees of the Named Insured and any independent contractors. Here again, there is no coverage for claims made by an injured employee of a subcontractor.
A third way that insurance companies eliminate coverage is by adding an exclusion for injury to independent contractors and employees of independent contractors. With this type of endorsement, the result is the same – no coverage for injuries to the subcontractor’s workers.
At a time when so many jobsite injuries result in liability claims in addition to the Workers’ Compensation claim, it’s important to know whether the coverage in the unendorsed CGL policy has been preserved. Review your policy, including all of its endorsements carefully. If something seems to remove coverage for subcontractor injuries, ask your insurance advisor for additional information.