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Commercial Liability

A Quick Lesson on General Liability Insurance

A Quick Lesson on General Liability Insurance

What is General Liability Insurance?

General liability insurance (GL) is a form of insurance purchased to protect an insured (usually a business entity) from an array of detrimental claims. GL policies cover losses sustained from a personal injury, bodily injury, property damage, and various losses caused by business operations.


Who needs General Liability Insurance?

Imagine investing years of hard work and countless hours building a successful business, only to have it taken from you because someone slipped and fell on your premises. Businesses without GL policies are exposed to a greater number of potentially detrimental risks.

Experienced business owners invest in general liability insurance because it transfers risk and helps to ensure the longevity of the venture. Every business owner who values their business should have a general liability policy. 


Why should businesses have General Liability Insurance?

When you own a business or piece of real estate anyone can sue you for any reason. If a person takes legal action against you, your general liability policy should protect you. General liability policies cover you for losses listed under the coverages, and also cover the legal fees associated with defending a claim. General liability insurance should cover legal fees regardless of fault! This means whether you are found innocent or guilty, the policy will pay to defend you in court. 


When should I purchase General Liability insurance?

You should purchase general liability insurance when you plan on opening a new business, or when purchasing a new piece of real estate. Any claims filed against you outside of the policy period will not be covered. It is not recommended that you operate a business or own a piece of property without having general liability insurance.  

For business owners, the best time to purchase/issue general liability insurance is anytime before you begin business operations. Businesses under construction should carry general liability insurance even before they begin business operations. Real estate owners should have a general liability policy issued on the date of their closing. 


When does General Liability Insurance “Kick-in”?

General liability insurance "kicks in" when you have a claim filed against you. General liability covers the cost of legal fees and will also cover the damages of a loss if the loss is covered under the policy. All general liability policies differ, but for the most part, they cover personal injury, bodily injury, property damage, and certain losses arising from business operations.

In order to receive payment from a GL policy, the claim must first be settled in court. Once the claim is settled, the carrier must make payment within a "reasonable" amount of time. It is tough to determine how fast a carrier will make payment, however, they usually pay out relatively quickly.  


Where can you purchase General Liability insurance?

If you are interested in purchasing general liability insurance or any type of insurance for your business, you should seriously consider contacting a licensed property and casualty (P&C) broker. Working with a licensed P&C broker is crucial for obtaining quality and affordable coverage. A good broker compiles the different risk exposures of your business, evaluates the appropriate limits of coverage and issues a quote with the most affordable premium. 


THE SKYLINE DIFFERENCE

Other brokerages take a cookie cutter approach to insurance and outfit their customers with generic coverage.  Skyline is different.  We believe insurance should be built on innovation and experience. We appreciate the fact that every engagement is unique and understand proper coverage requires a deep understanding of the underlying business and individual.

"The opportunity to safeguard your concerns is a privilege we never take for granted."

What is a Primary and Non-Contributory Endorsement?

What is a Primary and Non-Contributory Endorsement?

Contingent on the business, a primary and noncontributory endorsement can be an important part of an insurance policy. Credible businesses who understand the value of proper insurance coverage may want to require the parties they do business with to have insurance that includes them as an additional insured on a primary and non-contributory basis.

In order to truly recognize the importance of the primary and noncontributory endorsement, we must break down and analyze the terms "primary" and "noncontributory" separately.


Primary:

When an insurance policy is considered “primary” it will pay out first in the event of a loss. If there are two policies covering the same risk, the policy deemed “primary” will pay out its limit before the secondary policy and is responsible for the defense costs until liability is determined. This is important because if there is a claim, you want to the other party’s insurance to pay out first if there is a loss as well as pick up the defense costs.

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Noncontributory:

When and insurance policy is considered “noncontributory” the insurance carrier issuing the policy will not seek contribution from an additional insured if it pays out a loss.

For example, ABC general contractor needs some help constructing a building and hires XYZ subcontractor.  XYZ names ABC as an additional insured on a primary and non-contributory basis. If a claim arises and XYZ’s insurance company pays out, the noncontributory endorsement prevents them from seeking contribution for the loss from ABC. 

This is important because if the other party’s insurance pays out a claim, you don’t want their insurance carrier coming after you after claiming you were partially at fault and should responsible for contributing to the loss.


Primary & Noncontributory Endorsement (CG 20 01):

If you are named as an additional insured on a policy containing a "primary and noncontributory" endorsement, that policy will generally pay out first, cover the defense costs associated with the claim and be estopped from seeking contribution from you.  This endorsement is ideal for general contractors because it helps transfer the risk associated from the negligence of one of its subcontractors.

To learn more about primary & contributory coverage or proper risk transfer in general, contact us to set up a review of your insurance.


THE SKYLINE DIFFERENCE

Other brokerages take a cookie cutter approach to insurance and outfit their customers with generic coverage.  Skyline is different.  We believe insurance should be built on innovation and experience. We appreciate the fact that every engagement is unique and understand proper coverage requires a deep understanding of the underlying business and individual.

"The opportunity to safeguard your concerns is a privilege we never take for granted."

7 Tips for Managing Certificates of Insurance

7 Tips for Managing Certificates of Insurance

For those who do not know, a certificate of insurance ("COIs") is a document, which summarizes an insured’s coverage as it pertains to a particular risk. More often than not, COIs are issued to third parties who require evidence that proper coverage is in place. If handled irresponsibly, Certificates of Insurance COIs can be a cumbersome issue for your business. Here are 7 tips for managing certificates of insurance:


1. Get it from the broker:

Did you know an insured is prohibited by law to issue its own COI? In order for a COI to legally be issued it needs to come from a licensed insurance broker. To avoid any issues, ask an insured’s broker for a COI directly.

2. Set specific and concise requirements for EVERY risk:

There is no such thing as a universal insurance policy for every risk you encounter, determine the specific coverages necessary to ask for in the COI. Developing insurance guidelines specific to each risk you manage is the best way to ensure proper coverage. 

3. Don’t be afraid to voice your concerns:

At the end of the day, you are responsible for protecting the well-being of your business. If you sense or recognize an insured’s COI is not compliant with your requirements say something. Even if you are wrong, developing the habit of questioning and understanding the coverages listed in a COI will pay dividends for you in the future.

4. Create a system for managing COIs:

This may not be the most exciting part of your day but it will save you from misery in the future. Creating an internal system for managing and overseeing COI is a great way to reduce the risk of improper coverage.

5. Don’t Jump The Gun:

No matter how urgent it is to begin working a job, it is not worth risking the livelihood of your business. All too often businesses permit vendors to begin working on a job without reviewing and approving their COIs. You may get away with this once or twice, however, this bad habit can and will lead to issues moving forward. 

6. Record and Respect the Expiration Date:

One of the first pieces of data to extract from a COI is the expiration date of the policies listed. Ask yourself, what if the insured’s coverage expires in the middle of the project? Record and monitor the expiration dates for all policies listed on the COIs and make sure to follow-up for renewals. 

7. Outsourcing:

Depending on the size of your business, you may not be able to handle a comprehensive system for managing COIs internally. A common alternative is to outsource the responsibility of managing your COIs to your insurance broker. Skyline Risk Management, Inc. can oversee and manage your COIs for you. 

If you have specific questions about how you can manage your COIs, contact Skyline Risk Management, Inc. at (718) 267-6600 for more information. 


THE SKYLINE DIFFERENCE

Other brokerages take a cookie cutter approach to insurance and outfit their customers with generic coverage.  Skyline is different.  We believe insurance should be built on innovation and experience. We appreciate the fact that every engagement is unique and understand proper coverage requires a deep understanding of the underlying business and individual.

"The opportunity to safeguard your concerns is a privilege we never take for granted."

Insuring Completed Operations Pollution Risks

Insuring Completed Operations Pollution Risks

Construction companies are increasingly relying on specific insurance policies that protect against lawsuits regarding contamination and pollution. Contractor’s pollution liability, or CPL policies, help construction companies that may face lawsuits related to construction projects.

Pollution and contamination issues related to construction projects garner a lot of negative attention. They can also be financially and professionally difficult to navigate for companies involved in lawsuits. CPL policies can protect project owners and any contractors involved from liability claims.

Pollution, contamination, and other harmful environmental issues can occur during a construction project or after it has officially been completed. During a construction project, excavating, building roads, operating heavy machinery, and the materials used for the building can have a negative impact on the earth around the project.

If something should go wrong during the construction project, the mistake might not be known until after the project has been completed. A CPL policy helps minimize a project’s liability when it comes to environmental issues.


Project-specific policies

Project-specific CPL policies are useful for insuring a particular project that could have an environmental impact in a concentrated area. Obviously, the risk of pollution or contamination are highest where the construction is occurring. In most cases, contractors on a project will purchase a CPL policy and include the owner of the project as the additional named insured on the policy.

Although the instances of CPL policy purchase have increased, there are still some coverage gaps that need to be addressed. Often, the wording of the insurance requirements from the project owners conflicts with the CPL policies.

CPLs come in occurrence and claims-made forms. When a CPL is claims-made, additional insurance is needed for any issues that may arise after the construction project is completed. An occurrence-based policy doesn’t require any additional insurance purchases, but this can cause an increase in risk of claims made after the project is over. If a project owner or contractors choose not to purchase completed operations insurance additions to their CPL policy, this can leave a dangerous coverage gap.

Regardless of policy type, a project owner or contractor’s liability is only for the time period that the insurance policy is for. If damages occurred during that period, the insurance policy comes into play. Having a CPL policy and a completed operations policy can keep a project protected for longer.

A completed operations period refers to the time that a project has been completed, but issues related to the project may still cause problems. This can be a difficult timeframe to pin down. Some projects are more likely to cause pollution or contamination issues during construction, while others may have a bigger environmental impact after the job is done.


Benefits of CPL policies

CPL policies come with a few benefits. One benefit is that a CPL policy is project-specific, meaning an insurance policy can be tailored to an individual project’s characteristics. A policy holder can take into consideration the expected duration of the project, when the most environmental damage may occur, and what the completed operations period might be.

There are many insurance policies that try to cover environmental issues as part of a blanket policy. Having the ability to cater an insurance policy to the needs of a particular project decreases gaps in coverage and helps keep your risk lower for longer.

Additionally, you can choose to purchase completed operations coverage for claims or occurrence policies to cover all bases left by a construction project. CPL insurance isn’t the same as a general liability policy or other environmental insurance policies. An expert in environmental insurance issues should be consulted for your individual project to determine the best insurance for your project.


THE SKYLINE DIFFERENCE

Other brokerages take a cookie cutter approach to insurance and outfit their customers with generic coverage.  Skyline is different.  We believe insurance should be built on innovation and experience. We appreciate the fact that every engagement is unique and understand proper coverage requires a deep understanding of the underlying business and individual.

"The opportunity to safeguard your concerns is a privilege we never take for granted."
 
 
 

Commercial Insurance Policies and Extra Expenses

Commercial Insurance Policies and Extra Expenses

Wading through your existing insurance policies can be daunting. Knowing what you are and aren’t covered for can be a challenge, especially when you are faced with circumstances beyond your control. If you have experienced property damage to a business property that interfered with your business, your commercial insurance may cover business losses and extra expenses.

Commercial insurance policies are incredibly important to have in order to keep your business up and running, no matter what. Natural disasters or fires can be devastating to a community, and businesses that can stay open or reopen quickly will be able to support those communities looking to rebuild. Having the financial protection of a commercial insurance policy means not having to worry about how you’ll recover, but how soon you’ll recover.

Dealing with extra expenses

Some commercial insurance policies have provisions for extra expenses you may incur as a result of your property being damaged by fire or a natural disaster. If your property is damaged and you are losing business because you have to shut down for a period of time, you may be compensated for those business losses by your insurance. Other business losses could be because customers can’t access your business due to the fire or natural disaster shutting down roads.

There may be extra expenses that aren’t expressly covered in your insurance policy, but that could be covered by your insurance. For instance, a small company owned a property that was damaged by fire. The owner was able to set up a temporary office until a suitable alternative was found about two months later.

In this case, his extra expenses were setting up a new office and eventually moving to a more permanent location. As per his commercial business insurance, extra expenses that are covered include expenses that are incurred trying to avoid or minimize the amount of time your business is closed or not operational. This means that moving expenses and other costs associated with continuing operations at another location are covered by your insurance.

Additional expense coverage can be used to replace personal property that you use in your business, like furniture and other office supplies. A commercial insurance policy could compensate someone for the business income loss they might face.

Other extra expenses

Another commercial insurance extra expense comes in the form of preventative measures taken to save a property from further damage. After a storm, water trucks and generators were brought in to a property to save the landscaping, which was a golf course. Since the land was essential for the continued operation of the business, the extra expenses of the water trucks and generators to save the grass would be covered by their commercial insurance policy.

These expenses would be covered because they serve to minimize the time a business is not operational and, ultimately, reduce the total amount of loss a business faces during the time they are closed.

Commercial Insurance

Commercial insurance is designed to keep your business running for as long and as well as possible. If you do face closures or damages because of a natural disaster or a fire, your commercial insurance may cover additional expenses you may face in the course of preventing further losses. Most expenses that you face that minimize your total business losses may be covered by your insurance, as will extra expenses incurred to make sure your business can operate at any sort of functional level.

There are details and stipulations in commercial insurance policies that dictate what extra expenses qualify. If you do have a commercial insurance policy, go over it with your insurance agent to see what sort of expenses you may be covered for if the unexpected happens.


THE SKYLINE DIFFERENCE

Other brokerages take a cookie cutter approach to insurance and outfit their customers with generic coverage.  Skyline is different.  We believe insurance should be built on innovation and experience. We appreciate the fact that every engagement is unique and understand proper coverage requires a deep understanding of the underlying business and individual.

"The opportunity to safeguard your concerns is a privilege we never take for granted."