- Hawaii Insurance
- Hawaii Insurance
Contractor Insurance in Honolulu, HI
The construction industry poses a dynamic risk to Construction company owners, Project owners, and insurance professionals.
The construction field should be broken into two major segments, General Contractors (GC) and Sub-Contractors/Artisan Contractors (Sub).
General Contractors pose a unique set of exposures that need to be adequately contemplated and respectively mitigated or transferred to an insurance company for a premium.
A GC needs to purchase adequate general liability coverage, workers’ compensation, commercial automobile, umbrella insurance, employment practices, equipment coverage (whether owned or rented), and sometimes is called upon to insure the project against property loss from start to final walk through. A general contractor and sub-contractors have a constant need for certificates of insurance and endorsements to prove they had complied with the contracts they sign.
A service we provide is to review construction contracts prior to being signed to determine the financial impact complying with contracts will have on our customer’s insurance premiums. Sometimes we are able to mitigate insurance costs by supplying alternative verbiage to meet the spirit of the contract’s author rather than cause our customer’s to simply pay higher premiums.
General Liability for a GC will protect both the project owners’ interest as well as unrelated 3rd parties, such as the property next door. General Liability for a GC will answer claims for bodily injury or property damage suffered by someone who isn’t an employee or sub-contractor on the job-site. A subcontractor faces many of the same exposures as a GC on a job-site, and it is imperative that the general liability policy contain all of the endorsements necessary to protect the type of work being performed and none of the exclusions that would prevent an insurer from responding to a lawsuit.
Workers’ compensation is a statutory coverage required by law. Workers’ compensation prevents an employee’s real or imagined claim for injury from draining the assets of the company they work for, or depleting the personal assets of the company’s owner. Workers’ compensation is more of a social contract than real insurance in that the Workers’ compensation insurer doesn’t get the same latitudes when it comes to adjusting the claim. The work comp adjuster is more an administrator of statute than an arbiter. Workers’ Compensation is rated based on job class code, annual payrolls, and the application of the experience modification factor.
Commercial Automobile insurance is the most important coverage a GC or Sub can possess. It is far more likely that a construction company will get into an accident than a lawsuit. Having limits of insurance substantial enough to allow the company to survive a fatality auto accident is unfortunately a scenario that needs to be addressed before that type of accident occurs. Commercial automobile policies are rated and premiums calculated on the following criteria: gross vehicle weight, radius the vehicle is operated in, e.g. 50-100 mile radius, usage of the vehicle, e.g. delivers men and equipment to the job-site, personal vehicle of the owner, delivers goods to customers along a route, age of the vehicle, and finally the cost of the vehicle when it was newly purchased.
Umbrella coverage is simply put, higher limits of coverage. An umbrella sits on top and over the general liability limits of insurance, the workers’ compensation employers liability, and automobile liability limits. It provides higher dollars used for settlement when the worst case scenario occurs. It is seldom used and often costs a fraction of the general liability, workers’ compensation and automobile premiums.
Employment practices liability insurance is not a statutory coverage but it is a necessity in this day and age. Companies both large and small have been successfully sued by their employees for sexual discrimination, wrongful termination, discriminatory hiring practices, etc. An EPLI policy provides both legal defense and settlement dollars to assist employers against claims from their employees.
Equipment coverage is provided for equipment owned and rented by GC’s and Subcontractors. Owned or rented forklifts, mobile cranes, scissor lifts, etc. This specific type of coverage can even be expanded to cover the tools on a job-site owned by employees.
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