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Why Every Contractor Should Consider Purchasing a Commercial Umbrella Policy

Most contractors are aware of the need for Commercial General Liability, Workers’ Compensation and Business Auto Policies.  One policy often omitted from a contractor’s insurance program is the Commercial Umbrella Policy. Just like your umbrella will save you on a stormy day, a Commercial Umbrella Policy will save you when disaster strikes.

Stay Safe from the Storm With Help from a Commercial Umbrella Policy

The Commercial Umbrella provides additional limits of coverage in the event of a catastrophic claim.  For example, most Business Auto Policies provide no more than $1,000,000 of liability coverage.  An accident involving several injured people or extensive property damage could total much more than $1,000,000.  A Commercial Umbrella can be written to provide excess Business Auto liability coverage, which would respond to a claim in excess of $1,000,000.

The Commercial Umbrella Policy also helps in situations where a policy’s aggregate limit is reduced or depleted.  It is common, for example, for a Commercial General Liability Policy to be written with a limit of $1,000,000 each occurrence and a $2,000,000 general aggregate.  If a contractor has two $1,000,000 claims during the policy term, the aggregate limit is depleted, and there is no coverage available for future claims.  Although, if there is an Umbrella, it will drop down and stand in place of the Commercial General Liability Policy should there be a third claim.

In some cases, a Commercial Umbrella Policy may even provide broader coverage than the underlying Commercial General Liability or Business Auto Policy.  Some Umbrellas have worldwide coverage territories, while most other policies do not.  Whether this broadened coverage feature applies to a given claim depends on the specific language in the underlying and Commercial Umbrella policies (so make sure you understand the ins-and-outs of your policy). On top of providing more comprehensive coverage than your CGL, rates for a Commercial Umbrella Policy are typically much lower than that of the underlying liability coverages (which is great because more and more projects now require an umbrella policy).

If you do not currently have an umbrella, be sure to discuss this valuable coverage with your insurance advisor and request a quote.  You may be pleasantly surprised at just how affordable this extra peace of mind can be. Please feel free to contact us at 1-800-649-9094 if you have any further questions.



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Why Edition Dates Matter for Additional Insured Endorsement

You’ve just been awarded a new job and receive the contract to be signed.  The contract has numerous insurance requirements, and, at first glance, you think you have what you need.  The contract requires that you carry a $1,000,000 Commercial General Liability (CGL) Policy and that you add the general contractor as an additional insured endorsement using the CG 20 10 11 85 endorsement.  You know that you have a $1,000,000 policy and that you’ve added others to your policy as an additional insured endorsement as well, so you sign the contract, thinking all is fine. Read more

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What Dangers Does Plumbers Liability Insurance Really Protect You From

As a New York plumbing contractor you have probably had to repair more than your fair share of pipes, sprinklers, toilets and septic tanks (and sometimes things can get a little hairy). Still, you manage to go about your business and fix the problem. We find that admirable but, sometimes problems exist that you may be unable to fix. Problems that could expose you to unnecessary risk, financial loss and injury if you do not have the right insurance. Here’s what you need to know about plumbers liability insurance. Read more

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Why Won’t Your Insurer Issue an Unendorsed CGL Policy?

Do you know the difference between an endorsed Commercial General Liability (CGL) policy and an unendorsed CGL policy? If you don’t, you may find that your coverage will not have the support it needs to protect you when your need is dire. An unendorsed CGL policy is designed to cover claims if the insured is legally liable for certain types of injury or damage. The policy doesn’t restrict coverage to certain locations or types of operations and it does what it’s supposed to do; protect you. That is, as long as the applicant hasn’t misrepresented what he does (that’s called fraud), coverage applies to any type of work he may do.

Understanding the Ins-and-Outs of an Unendorsed CGL Policy

The problem is that many insurers don’t issue an unendorsed CGL policy. Why? Because it means they have to cover more, and more coverage is just bad business for insurance companies. So, they add endorsements designed to specifically exclude certain locations or operations or to restrict coverage to locations and operations that they consider risky (which could leave you exposed and vulnerable). Listed below are some of the most common exclusions that you’ll find when you don’t have an unendorsed CGL policy.

  • Residential work
  • Work in certain states (New York is a commonly excluded state)
  • Work on projects higher than certain number of stories
  • Bridge work
  • Lead and Asbestos Abatement
  • PEX Piping
  • Roofing

Other policies take a different approach. Rather than listing the type of work not covered, they  instead restrict coverage to operations and list a class code on the policy through the addition of a Designated Classification Limitation endorsement. It’s a much safer approach for both parties, but it’s still not foolproof. The problem with these endorsements is that a contractor cannot always tell whether a job he is considering is covered by a described classification. Descriptions are often general; Carpentry, for example, can include a variety of types of work.

It is important to review your policies for any type of endorsement that restricts the type of work that is covered. It is equally important to be honest about the type of work you are doing, have done in the past, and plan to do during the policy term. Honesty on both sides will help create a much stronger relationship and should help your insurance company find the protection that you need. An unendorsed CGL may be out of reach for some but that doesn’t mean you need to accept subpar insurance.



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A Guide to Commercial General Liability Insurance

A slip, a fall, one misstep on the ladder. That’s all it takes. All it takes for one lawsuit to rob you of all of your earnings and efforts to get your small construction business off the ground. How? Because when someone is visiting your work site (or is on your work site) and they end up injured they can hold you liable for their injuries. And all of those medical bills can pile up fast. Luckily, there is a way to prevent litigation and other repercussions from accidents that may occur on your work site and it comes in the form of commercial general liability insurance. Here’s what you need to know.

Commercial General Liability Insurance – Who Needs It?

The short answer is… pretty much everyone. Commercial general liability is required by law in most states and, when it’s not, it’s typically included in the contractors’ contract. Why the inclusion? Because when you work as a contractor you are working in a high risk industry which means it doesn’t take much to go wrong if an untrained person has entered your work site. So, to reduce the possibility of someone injuring themselves (while you’re working) and then trying to sue you we highly recommend you looking into a commercial general liability insurance policy.

There are also some general liability perks that contractors get to enjoy that others (like small business owners and freelancers) may not get to enjoy. Primarily, contractors can avoid the extra coverage that a Business Owner’s Policy (BOP) may include. Of course you can still get a BOP if you so choose, as the amount of coverage you need may vary from contractor to contractor (a roofer will probably need more coverage than a plumber).

How do you get Commercial General Liability Insurance?

The key to getting a commercial general liability policy that is right for you is to first find an insurance agent that will advocate for your needs. We would suggest that you find an independent insurance agent as they will be able to provide you with a greater variety of policies (as they represent multiple insurance companies) ensuring that you will get the best coverage for the lowest price.

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