What tools do you have to use?

Today, we are discussing these topics as it relates to insurance products: > Risk mitigation, avoidance, transfer and more

Where to begin? Start with the CONTRACT.

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Contract examples relating to insurance needs

Examples include: > Owner to contractor > Owner to design-build contractor > Owner to general contractor > Owner to professional service provider > Owner to material supplier > AIA, consensus – custom:

– Are you enforcing those specs to all of the downstream players?

Each can have their own nuances and differentiators…

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Basics, etc.

Builder’s risk – your responsibility? > Amount - modifications of contract sum

– Hard & Soft costs – Tax credits- covered?

> Insureds to include owner, loss payees, etc. > Deductibles > Protective safeguard prohibition, etc. > Watch your restrictions - retention pond example > Permission to occupy - big! > WOS in favor of owner

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Basics, cont.

Business auto > Limits > Scope- watch your material suppliers

– Resisting signing the subcontract agreement – AI – WOS – Notice of cancellation

> Duty of owner on jobsite

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Basics, cont.

Excess/Umbrella These are not the same > Scope > Concurrency > Drop down provisions > PNC issues

– Vertical vs. Horizontal Exhaustion Issues

> Defense costs

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Gearing up for additional coverages

Professional liability > Limits > Scope > Retro dates > Prohibitions > Terms:

– Claims made – Extended discovery periods, etc.

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Pollution liability > Same issues- but also consider:

– Additional insureds – PNC availability – Prohibitions – Term – consider longer – PLL policies can work for sale

Gearing up for additional coverages

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Other items to consider

> AM best size, ratings

> Deductibles/retentions

> Specify the COI requirements

> Enforce the pass through requirement to subs, subs-subs and

material suppliers, etc.

> Use of owners equipment, etc.

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Other items to consider

What about pre-qualification

> Financials- are they valuable?

> Does your contracting partner have a surety program?

> Can they qualify for an SDI program?

> EMR use- do you enforce or make exceptions?

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Other tools

Subcontractor Default Insurance (SDI) > CRU > Zurich’s Sub-guard > XL / Catlin

Surety Bonds > A great pre-qual tool for a contractor and affordable guarantee tool

Owners Protective Professional Indemnity (OPPI)

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Claims

Considerations at claims time… > Do you have a disaster plan? > Key media, contact person? > Policy copies- and…did you know?

– Certain carrier adjusters have certain levels of authorization for check writing…do you know who you are working with?

> Communication strategy & contingencies

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Disclosure

Pursuant to the rules of professional conduct set forth in Circular 230, as promulgated by the United States Department of the Treasury, nothing contained in this communication was intended or written to be used by any taxpayer for the purpose of avoiding penalties that may be imposed on the taxpayer by the Internal Revenue Service, and it cannot be used by any taxpayer for such purpose. No one, without our express prior written permission, may use or refer to any tax advice in this communication in promoting, marketing, or recommending a partnership or other entity, investment plan, or arrangement to any other party. Baker Tilly refers to Baker Tilly Virchow Krause, LLP, an independently owned and managed member of Baker Tilly International. The information provided here is of a general nature and is not intended to address specific circumstances of any individual or entity. In specific circumstances, the services of a professional should be sought. © 2015 Baker Tilly Virchow Krause, LLP

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