As a property owner, you can save yourself time, expense, and worry by making sure that every subcontractor you hire is properly insured and has an up-to-date general liability policy.
To protect yourself against unexpected liability, avoid these mistakes:
1. Failure to obtain an original Certificate of Insurance from the contractor’s insurance company or agent. Insurance agents provide these certificates routinely. Just asking the contractor if they are insured is not enough.
2. Failure to check dates of the contractor’s insurance policy term and verify the insurance coverage policy dates. Make sure that insurance coverage has not lapsed or been cancelled. Also make sure that the job will be completed within the policy term dates; otherwise you will need to request a new certificate.
3. Failure to review limits on the subcontractor’s policy. Make sure the insurance limits carried by the subcontractor are equal to or greater than the limits that you carry. You can consult with your agent to establish adequate limitation requirements.
4. Failure to keep records of certificates. Keep the Certificates of Insurance on file. If your insurance carrier conducts an audit, you will need to make these available.
5. Failure to have your lawyer review your contracts periodically to ensure they are up to date.
By avoiding the above mistakes and using proper contract language, property owners can transfer their liability risks to the party that is directly responsible for the safe working environment.
Loss Control Manager