Miller Act and State Laws – What State Laws? ► The District Court grants the motion, finding that the unlicensed status of the Subcontractor was a complete defense to the payment claim ► The California statute “precludes any contractor from maintaining an action for collection of compensation for services if the contractor was not a licensed contractor during performance of the contract” ► The Sub-subcontractor appealed 118
Miller Act and State Laws – What State Laws? What do you think is the outcome? 119
Miller Act and State Laws – What State Laws? ► The Court of Appeals finds that the California law “restricts the substance of the rights” afforded under the Miller Act ► Conditioning contractors’ rights under the Miller Act on compliance with state laws would “wreak havoc on the uniform application of the Miller Act” ► Thoughts? 120
Notice: Procrastination is opportunity’s assassin. ► Baistar Mech., Inc. v. Cont’l Ins. Co. , 2014 WL 2156657 (D.D.C. May 22, 2014) ► Subcontractor performs work at the Brazilian Embassy ► Prime Contractor’s payment bond required that any lawsuit be commenced prior to “the expiration of one year from the date…on which the last labor or service was performed by anyone…under the Prime Contract” ► This is substantial similar to the AIA A312-2010 form ► As early as February 2011, the Subcontractor had invoiced the Prime Contractor the total amount of the subcontract price 121
Notice: Procrastination is opportunity’s assassin. ► But it provided equipment training at the Project site more than six months later (by September 30, 2011) ► Due to a $350,000+ payment dispute, the Subcontractor and the Prime Contractor enter into a 1-year “tolling agreement” ► When no resolution was reached, the Subcontractor filed a lawsuit against the Surety on July 15, 2013 ► The Surety filed a motion for summary judgment based on the “contractual statute of limitations” 122
Notice: Procrastination is opportunity’s assassin. What do you think is the outcome? 123
Notice: Procrastination is opportunity’s assassin. ► The District Court granted the motion ► The Subcontractor’s allegation that it performed “consulting services” with respect to the HVAC system it had installed was insufficient to extend the deadline for filing a suit on the bond ► The Court found this was not work that was part of the original Prime Contract ► Instead, it was “merely for the purpose of correcting defects, or making repairs” to the previously-completed work 124
Notice: Procrastination is opportunity’s assassin. ► The fatal blow: the General Contractor’s affidavit that all work required under the Prime Contract was completed when the Subcontractor finished the on-site HVAC equipment training ► Although the Court accepted a “trigger date” that was months after the final invoice was sent by the Subcontractor, that was still too early for the Subcontractor’s bond claim to survive ► The Subcontractor’s delay between tendering the claim to the Surety and actually filing suit on the bond sunk its case 125
Notice: Procrastination is opportunity’s assassin. ► It is unclear why the Prime Contractor/Subcontractor “tolling agreement” did not include the Surety ► This was a fatal error for the Subcontractor’s rights on the payment bond ► Thoughts? 126
Other Payment Protection Strategies Parent Guaranty/Indemnities ► Commits the financial resources of another entity (usually a parent or affiliate of the Principal) to support the performance of the Principal’s contractual obligations ► Often utilized when dealing with Single-Purpose Entities and common in construction lending transactions (for the benefit of the lenders) ► Wide range of terms, including “covered risks,” length of financial support, and net worth and liquidity commitments 127
Other Payment Protection Strategies Irrevocable Letters of Credit ► A banking instrument that operates similar to a check ► Beneficiary has the right to “cash” the ILoC by endorsing the instrument and providing a statement in accordance with the document ► Bank and “posting party” have limited abilities to prevent payment, but may have a claim back against the Beneficiary for recovery of funds and resulting damages 128
Other Payment Protection Strategies Construction Escrow and Disbursing Agreement ► A multi-party agreement between the Owner, Lender and Title Company, usually with the Prime Contractor as a non-party signatory ► Outsources Sworn Statement/Lien Waiver submittal process to title company, which issues “date-down” endorsements to the Lender’s Mortgage/Trust Deed Policy ► Usually supported by Personal Undertakings from the Owner and (if a “pay-general” system is used) the Prime Contractor 129
Other Payment Protection Strategies “Lockbox Account” ► A multi-party agreement that restricts access to Project proceeds ► Sometimes utilized in conjunction with financing agreements and ILoC’s to allow the bank to maintain control of distributions 130
Other Payment Protection Strategies Pledges of Other Assets ► The protected party is granted rights in other collateral (such liquid financial instruments, securities, real estate, Accounts Receivable, equipment, etc.) ► May be subject to Uniform Commercial Code requirements for Security Interests ► Value of assets may fluctuate, and restrictive covenants may be needed 131
Session 5: Insurance Risks in Multifamily Residential Construction Jason Wilsey Willis of Minnesota
The New Normal Construction Risk 2.0 Jason Wilsey, Vice President Willis of Minnesota, Inc .
Today You Will Receive… • Clarity in understanding current and future risk issues in construction • How these risks affect you • Simple, Effective, Aligned insight, helping you: – Reduce cost – Improve cash flow & margin – Protect earnings – Make informed decisions – Don’t end up like this guy…
*Happy Gilmore 9 th Green at 9 clip
Look On The Bright Side… • Taxes are reaching and exceeding 50% (depending on state) • OSHA, EPA, DOT and other regulatory institutions are ramping up oversight and penalties • Record rainfall, droughts, wildfires and more intense seasonal weather (blizzards, hurricanes) • Contract language has become more stringent • Recommendations and Value Engineering potentially classify you as a “design professional”
Guess What? These are “The Good Old Days” • Taxes • Politics • Climate • Regulation • Litigation Unfortunately, we will look back and remember these as when things were easier…
Welcome To The “New Normal”
Where’s The Action? Warming Up • Industrial • Commercial • Retail Hot! • Apartments • Senior Living • Hotels • Student Housing • Condominiums
Condo’s??? *Insert Whatchu Takin Bout Willis video
Multi-Family • New reinvestment initiatives to urbanize downtown areas • Example: Minneapolis 2025 Plan – Create space for over 300,000 new residents in downtown Minneapolis • More apartments and mixed use developments, including condominiums
Building Is Good! So What?
We Agree! But In The “New Normal” • Insurers are not keen on insuring habitation risk • Housing market is showing signs of recovery • Potentially “Overbuilt” • A proverbial “Bubble” • Excluding coverage for Residential Construction
“But I’m Not Building Single Family Homes, Tow nhomes Or Condos”
If Apartments Are Covered, Then More Than Likely... This insurance does not apply to "bodily injury", "property damage" or "personal and advertising injury" arising out of or in any way related to premises if those premises, in whole or in any part, are or were at any time, marketed, sold, occupied,or used as residential premises. Residential premises include, but are not limited to: 1. Condominiums, cooperatives, dwellings,homes, houses, townhomes or townhouses, timeshares and "mixed- use buildings"; and 2. Appurtenant common areas, structures, facilities and grounds associated with the residential premises. Residential premises also include any conversion of property to or from any of the residential premises described above. Residential premises do not include nursing homes, assisted living facilities, hospitals. dormitories, jails, prisons, military housing, apartment buildings, hotels or motels, provided that any such premises, in whole or in any part, are or were not at any time,marketed, sold, occupied, or used as condominiums, cooperatives, dwellings,homes, houses, townhomes or townhouses,timeshares or "mixed-use buildings." For the purposes of this endorsement, ''mixed-use buildings" means any structures and improvements thereto which contain both: (i) residential living space and (ii) commercial or industrial space. This exclusion does not apply to "bodily injury", "property damage" or "personal and advertising injury'' arising out of on-going operations performed by you or on your behalf. This insurance is excess over any other valid and collectible insurance (including any deductible portion thereof) availabie to the insured whether primary, excess,contingent or on any other basis.
Condo Conversion Exclusion • High end finishes • Rebounding housing market • High rents making homeownership more appealing • Market studies showing increased demand for urban living – Transit, Green lifestyle, “Lock and walk”
Uncovered CD Claim – Who Is At Risk? • Owner • Lender • General Contractor • Subcontractor
Construction Defect Liability Construction Defect Liability – what is this? Generally speaking, a deficiency in the design or construction of a building or structure resulting from a failure to design or construct in a reasonably workmanlike manner, and/or in accordance with a buyer's reasonable expectation. (IRMI’s Glossary of Insurance and Risk Management terms) Statute of Repose – the time period within which a construction defect action must be brought. In Minnesota, the exposure lasts for 10 years following substantial completion, plus 2 years for late manifestation. CD-related lawsuits are common in the construction industry, and condos/TH’s are even more prone to CD claims when compared with commercial or single family residential. 148
Example Electrical Fire in Potential Outcome Apartment Project • Job delay • Claim Triggered • Claim trails back up through • Passed via contract from the contract path GC to Electrical Sub • Lawsuit • Electrical Sub files claim • Electrical sub potentially out against their insurance of business carrier • Compromised relationships • Sub carries “residential – Owner/lender exclusion” in general – Owner/GC liability policy – GC/Sub
Traditional Risk Transfer / Insurance OWNER Indemnification / GL Contractual Risk Transfer Additional Insured GENERAL CONTRACTOR Contractual Risk Transfer Indemnification / GL Additional Insured SUBCONTRACTORS 150
Utilizing Traditional Insurance For Habitation • Beware • Very difficult to manage – Companies move insurance providers – Do you have time to read all sub policies? – How does your policy apply to the new paradigm? • Certificates of Insurance do not disclose whether “residential” exclusion applies – Or if it has been amended – What if the project converts?
Don’t Panic! • With the right process, you can proactively budget, plan and deliver your work confidently • Multi-Directional Value – GC to Owner – Owner to Lender – GC to Sub
What’s Out There? • High capacity of available insurance volume • 2:1 ratio of available capacity for current volume in current marketplace • Habitation strategies and programs assuring GC and Subs all carry completed operations coverage (CGL) up to the statute of repose • Pricing will continue to soften – Positive loss performance – Quality risk control procedures
What Should We Do? • *Movie clip – Caddy Shack, Billy Murray “I’d keep playing, I don’t think the heavy stuff will come down for quite a while” • - Consider this slide at the end
Utilizing These Strategies • Balance Sheet – Protected • Cash Flow & Margin – Improved • Unexpected Expenses – Reduced • Time - Saved • Decision Making Insight – Increased – More certainty – Confidence in your delivery – Focus on what you do best How do I learn more about these strategies?
Call Me Jason A. Wilsey – Vice President 763-302-7102 jason.wilsey@willis.com
Session 6: Critical Legal Developments in CGL and Property Insurance Patrick O’Connor Partner
Anatomy of a Construction Contract Insurance Provision ► Required Coverages ► Workers’ Compensation/Employers’ Liability ► Commercial General Liability ► Automobile Liability ► Property/Builder’s Risk Coverage ► Optional Coverages ► Excess/Umbrella Liability Insurance ► Professional Liability Insurance ► Pollution Liability Insurance 158
► Coverage Limits ► General Liability ► Per Occurrence/Aggregate Limits ► Property Insurance ► General Limits ► Sublimits for Specified Perils or Coverage Extensions ► Excess/Umbrella Insurance ► Limits ► Exhaustion ► Follow Form ► Excess vs. Umbrella 159
► Additional Insured Coverage ► Primary and Non-Contributory ► Elimination of Cross-Suit Exclusion ► Elimination of Privity Requirements ► Scope of Additional Insured Coverage ► Relationship of Anti-Indemnity Laws to Additional Insured Coverage ► Subrogation Waivers ► Scope of Waiver ► Waiver Triggers 160
► Certificates of Insurance ► Carrier Financial Thresholds ► Cancellation and Notice ► Miscellaneous Requirements 161
162 Real-Life Examples of Contract Language
163 COVERAGES
Workers’ Compensation ► In the event contractor is not required to provide or elects not to provide workers’ compensation coverage, the parties hereby agree that contractor, its owners, agents and employees will have no cause of action against, and will not assert a claim against, the State of Louisiana, its departments, agencies, agents and employees as an employer, whether pursuant to the Louisiana Workers’ Compensation Act or otherwise, under any circumstance. 164
Commercial General Liability COMBINED SINGLE LIMIT (CSL) PER OCCURRENCE Projects over Projects Projects over Type of $1,000,000 up to up to $1,000,000 $10,000,000 Construction $10,000,000 New Buildings: $1,000,000 $2,000,000 $4,000,000 Each Occurrence Minimum Limit $2,000,000 $4,000,000 $8,000,000 Per Project Aggregate The building(s) value for the Project is $_______________. Renovations: $1,000,000** $2,000,000** $4,000,000** Each Occurrence Minimum Limit 2 times 2 times 2 times Per Project Aggregate per occur limit** per occur limit** per occur limit** **While the minimum Combined Single Limit of $1,000,000 is required for any renovation, the limit is calculated by taking 10% of the building value and rounding it to the nearest $1,000,000 to get the insurance limit. Example: Renovation on a $33,000,000 building would have a calculated $3,000,000 combined single limit of coverage (33,000,000 times .10 = $3,300,000 and then rounding down to $3,000,000). If the calculated limit is less than the minimum limit listed in the above chart, then the amount needed is the minimum listed in the chart. Maximum per occurrence limit required is $10,000,000 regardless of building value. The per project aggregate limit is then calculated as twice the per occurrence limit. 165
Commercial General Liability ► Products and completed operations coverage. This coverage shall extend through the contract guarantee period and for at least 6 years from final completion of all work. ► Employees as additional insureds. ► The aggregate must be applicable on a per project basis. 166
Commercial General Liability ► A policy of commercial general liability insurance, written on an insurance industry standard occurrence form, including all the usual coverages known as: premises/operations liability; products/completed operations; personal injury; contractual liability; independent contractors liability; and fire damage legal liability. Such policy(ies) must provide the following minimum ► Bodily injury and property damage - $2,000,000 each occurrence ► Products or completed operations - $2,000,000 each occurrence ► Any deductible or self-insured retention must be disclosed and is subject to approval by the Electric Boat Corporation’s risk manager. The cost of any claim payments falling within the deductible shall be the responsibility of the contractor. 167
Commercial General Liability ► Commercial general liability insurance, with limits no less than One Million Dollars ($1,000,000) combined single limit per occurrence and Two Million Dollars ($2,000,000) annual aggregate limit for bodily injury and property damage, including coverage for contractual liability; personal injury; fire damage legal liability; advertisers’ liability; owners’ and contractors’ protective liability; products and completed operations; broad form property damage; and explosion, collapse and underground (XCU) coverage during any period in which Borrower is conducting any activity on, alteration or improvement to the Site with risk of explosions, collapse, or underground hazards. 168
Builder’s Risk ► Builder’s Risk Insurance shall be in an amount equal to the greater of the fully-completed project value or the amount of the construction contract including any amendments and shall be upon the entire work included in the contract. The policy shall provide coverage equivalent to the ISO form number CP 10 20, Broad Form Causes of Loss (extended, if necessary, to include the perils of wind, earthquake, collapse, vandalism/malicious mischief, and theft, including theft of materials necessary to provide plans, specifications and supervision of work for the repair and/or replacement of property damage caused by a covered peril, not to exceed 10% of the cost of the repair and/or replacement. 169
Builder’s Risk ► The policy shall provide coverage for “all risks” of direct physical loss or damage to the portions or elements of the Facility under construction, excluding terrorism but including the perils of earthquake, earth movement, flood, storm, tempest, windstorm, hurricane, and tornado and subsidence; shall contain extensions of coverage that are typical for a project of the nature of the Facility; and shall contain only those exclusions that are typical for a project of the nature of the Facility. 170
Builder’s Risk Section 1: Insurance Coverages Required Prior to Final Completion of the Project Assets ► Builder’s Risk Insurance for physical loss, destruction, or physical damage to the Work. The Builder’s Risk insurance will cover the Concessionaire, Design-Build Contractor, the Department, and other Contractors of all tiers until Substantial Completion of all of the Project Assets; provided, that the limits of such coverage may be based on a maximum probable loss analysis, subject to the Department’s approval of such maximum probable loss analysis by an independent third party acceptable to the Department. In no event will the limits of such coverage be less than $250 million. Further, the policy will include sub-limits for certain specified perils including, but not limited to: Offsite Storage, Property in Transit, Expediting Expenses, Demolition and Increased Cost of Construction, Debris Removal, Mobile Equipment and Professional Fees/Loss adjustment expenses. The policy also will include replacement cost coverage for materials, supplies, equipment, machinery, and fixtures that are or will be part of the Project. Coverage will include, but not be limited to, the following: right to partial occupancy; earthquake; earth movement; flood; transit; temporary and permanent works; expediting expenses; debris removal; offsite storage; delayed opening, commissioning; and start-up. 171
Builder’s Risk Section 2: Insurance Coverages Required for the Project following the Existing Assets Tolling and O&M Work Commencement Date ► Property and Business Interruption Insurance at replacement cost covering loss, damage, or destruction to the Project, including improvements and betterments; provided, that the limits of such coverage may be based on a maximum probable loss analysis, subject to the Department’s approval of such maximum probable loss analysis by an independent third party acceptable to the Department. In no event will the limits of such coverage be less than $250 million. Coverage will include, but not be limited to, the following: flood, earthquake, earth movement; collapse; water (including overflow); leakage; utility interruption; debris removal; business ordinance or law for increased costs of construction; extra expenses; valuable papers; and terrorism. Subject to the applicable deductible, such coverage also will insure against interruption or loss of projected Toll Revenues for at least six months from the occurrence of the risk, resulting from physical damage to the Project and any relevant feeder roads. The Department is to be named as an additional insured on a primary, non-contributory basis. The Concessionaire is responsible for all loss or damage to personal property (including but not limited to materials, fixtures/contents, equipment, tools, and supplies of the Concessionaire. 172
Builder’s Risk ► All Risk Builders Risk Insurance or Installation Floater ► If Permittee is undertaking any construction, including improvements, betterments and/or repairs, Permittee shall provide All Risk Builder’s Risk Insurance or an Installation Floater covering the materials, equipment, machinery and fixtures that are or will be part of the permanent facility. Extensions of All Risk Builders Risk coverage shall include earthquake, flood, materials in-transit and off-site, utility interruption, debris removal and delayed opening. 173
Excess Liability Insurance ► Umbrella and Excess Liability Insurance with the following features: ► Coverage that provides excess coverage for Employers Liability, Commercial General Liability, and Auto Liability, with the same features as described in sections A, B and D herein with limits not less than $5,000,000. Subcontractor acknowledges that it will provide Umbrella and Excess Liability Insurance on behalf of the Contractor and that the Umbrella and Excess Liability Insurance will be subject to vertical exhaustion before any other Primary, Umbrella or Excess Policies or any other insurance obtained by the Contractor will be triggered. The total insurance coverage provided by Subcontractor for any claim will under no circumstances be less than the combined Primary limits as defined in Section A, plus the Umbrella and Excess limits as defined above. Subcontractor (vendor) further acknowledges that the total amount of insurance coverage provided by its insurance carriers, whether primary, excess, umbrella or other, where Contractor, and others, as specified above, are afforded additional insured coverage, shall apply as first tier/following form coverage. Any other insurance maintained by Contractor, or any other additional insured shall be excess of this first tier coverage and shall not be called upon to contribute to satisfy any loss within the limits specified and required above. Subcontractor shall furnish umbrella/excess policy language evidencing coverage to apply on a primary and non-contributory basis to the Contractor as Additional Insured. 174
Excess Liability Insurance ► Supplier shall carry Excess Liability Insurance that follows the form of the underlying primary liability insurance required by employer’s liability only, general liability, and automobile liability in an amount not less than $5,000,000 per occurrence and $5,000,000 in the aggregate. 175
Professional Liability Insurance ► When any professional services, such as architecture, auditing, construction design, engineering, mechanical design, or other service which requires professional certification and licensing by a governmental entity, is being provided to the Chicago Park District under the Permit, Professional Liability Insurance with limits of not less than $1,000,000 per occurrence for damages arising from any acts, errors or omissions. Coverage shall include severability of interest and cross-suit liability for consultants/sub-contractors. Claims-Made policies shall be renewed each year for a period of two (2) years after completion of the contract and shall have an extended reporting period of two (2) years. When renewed or replaced, the policy retroactive date must coincide with or precede start of work under the Permit. 176
Professional Liability Insurance ► Design Service Requirements ► If Subcontractor or its sub-subcontractor performs design services, Subcontractor will purchase, furnish and maintain or require its sub-subcontractor to purchase, furnish and maintain professional liability insurance with limits of at least $2,000,000 and with the following coverages: basic professional errors and omissions, punitive damages (where not prohibited by law), contractual liability, with a retroactive date that is no later than the date of inception of design services. Such coverage shall be maintained in effect for a period of five (5) years from the Date of Substantial Completion of the Project or the statute of repose, whichever is longer. 177
Professional Liability Insurance ► Policy of professional liability insurance – appropriate to the contractor’s operations. Coverages should be for a professional error, act or omission arising out of the scope of services required by this agreement. Such policy(ies) must provide the following limits: ► $5,000,000 per claim 178
Professional Liability Insurance ► All claims based on acts, omissions, injury or damage occurring or arising in whole or in part during the policy period must be covered. If any required insurance is provided under a claims- made policy, coverage must be maintained continuously for a period ending no less than three (3) years after recordation of a notice of completion for builder’s risk or the Compliance Term for general liability and property insurance. 179
Pollution Liability Insurance ► When any pollution risk exposure is apparent, Pollution Liability Insurance shall be provided on a blanket basis covering bodily injury, property damage and environmental restoration for claims arising out of performance of services including handling, clean-up and excavation of waste and hazardous materials. Limits required for each shall not be less than $1,000,000 each accident and general aggregate. Claims-Made policies shall provide an inception or retroactive date prior to the date of this agreement and be renewed each year for a period of three (3) years after termination of this agreement or provide an extended claims reporting period of not less than three (3) years after the termination of this agreement. 180
181 Coverage Limits
Coverage Limits ► CGL General Aggregate Limits – Per Project: ► We require that your CGL policy’s General Aggregate limit applies separately to this project. By doing so we eliminate concerns that the limit could be eroded due to claims from other projects that you are working on. The “Project” box in the CGL section of the Certificate should be checked or the words “Per Project” should be typed in this section. 182
Coverage Limits ► Any policy in a form of coverage that includes a general annual aggregate limit or provides that claims investigation or legal defense costs are included in the general annual aggregate limit must be in amounts that are double the occurrence or claims limits specified above. 183
Coverage Limits ► The City reserves the right to require an increase in insurance coverage in the event the City determines the conditions show cause for an increase, unless Borrower demonstrates to the City’s satisfaction that the increased coverage is commercially unreasonable and unavailable to Borrower. 184
Coverage Limits ► Limits of Insurance: Subcontractors insurance coverage shall apply for the full amount of any loss up to each respective policy limit of liability and shall not be limited to the minimum required limits of this subcontract. In specifying minimum requirements herein, neither Contractor nor Owner assert or recommend this insurance as adequate to Subcontractor’s requirements. Subcontractor is solely responsible to inform itself of types of insurance or additional limits it may need beyond these. 185
186 Additional Insured Coverage
Additional Insured Coverage ► Acceptable Additional Insured endorsements include ISO Form CG 2010 1185 or the use of both ISO forms 2033 1001 and 2037 1001 together. Notwithstanding the foregoing, the use of any form, including but not limited to ISO form 2010 0704 and/or 2037 0704 or later versions, are subject to review and will not be acceptable if they limit coverage to the Additional Insureds for liability caused by their acts or omissions, or those of the named insured (or someone acting on behalf of the named insured). Endorsement wording that states that coverage will be excess of any other policies for which the parties to be named as additional insureds (per paragraph f above) have additional insured status is likewise unacceptable. A copy of the additional insured endorsement shall be provided to the Contractor for approval prior to commencement of work. 187
Additional Insured Coverage ► The insurance required by General Liability, Automobile Liability, and Excess Liability (if required) Sections shall include Company, its direct and indirect subsidiaries and affiliates including Limited Liability Companies, as additional insureds with respect to all operations and work hereunder, as to the full limits of liability purchased by the Contractor (including limits greater than the minimum limits required herein). 188
Additional Insured Coverage ► Developer, TxDOT and the Design-Build Contractor shall be the named insureds on the policy as their respective interests appear. Developer also may, but it not obligated to, include other contractors as named insured as their respective interests appear. The policy shall be written so that no act or omission of any insured shall vitiate coverage of the other named insureds. Developer may name itself or the Collateral Agent as loss payee under the policy. 189
Additional Insured Coverage ► Subcontractor shall provide the following ISO Endorsements or their functional equivalents: CG 20 33 10 01 (Additional Insured – Owners, Lessees or a) Contractors – Automatic Status when required in Construction Agreement with You) CG 20 10 10 01 (Additional Insured – Owners, Lessees or b) Contractors – Scheduled Persons or Organization) if applicable for Owner or other persons or entities CG 20 37 07 04 (Additional Insured – Owners, Lessees or c) Contractors – Completed Operations) CG 24 04 10 93 (Waiver of Transfer of Rights of Recovery d) Against Others to Us) 190
Additional Insured Coverage ► All liability policies must provide that the insurance is primary to any other insurance available to the additional insureds with respect to claims arising out of this Agreement, and that insurance applies separately to each insured against whom claim is made or suit is brought and that an act of [sic] omission of the named insureds that would void or otherwise reduce coverage will not void or reduce coverage as to any other insured, but the inclusion of more than one insured will not operate to increase the insurer’s limit of liability. 191
Additional Insured Coverage ► Additional Insured Protection to be “Primary and Non- Contributory”: ► We require subcontractors to have the additional insured language structured so that it is “primary and noncontributory” as respect insurance contractor maintains. This means that your policy must respond in defense of contractor first and with no contribution of coverage from contractor’s policies. 192
193 Waivers of Subrogation
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