Does an Excavating Contractor need Inland Marine insurance coverage?

July 24, 2014 in contractor's equipment program, inland marine, inland marine insurance, LICA, LICA members, united fire group

Most of the Excavating Contractors you know probably work well away from the shore or ocean. Why would they need something called Inland Marine insurance? The name of the policy may be a little strange but the coverage is really necessary. Now that Pennsylvania has agreed to allow insurance companies to pay dividends on premiums on coverage through LICA, this much needed insurance can become a reality.

 

The basic inland marine policy covers property and equipment that isn’t covered by another source of insurance. For instance, a contractor may have a construction trailer on site. A storm may come through and damage the structure but it may be covered under a different policy. If it is not, the inland marine clause would cover it.

 

Inland marine will also cover any computer equipment, software and data that may have been damaged in the construction trailer. This insurance also covers materials, supplies, equipment, machinery and fixtures that are owned by the contractor, or for which he is legally liable, that are to be installed while the property is at a construction site, in transit, or at a temporary storage site. This can be a tremendous relief for owners who must transport heavy machinery from one location to another, or who need to leave the machinery on-site for a lengthy period of time while the project is underway.

 

There is also the option of adding personalized coverage. This policy is called a “Contractor’s Equipment Program”.  This coverage is for the contractor’s equipment, as well as equipment in his care, custody and control. It applies to all equipment, whether owned, rented or borrowed, rather than only equipment listed in the policy. Contractors Equipment Program even includes rental reimbursement coverage, which pays part of the cost of renting substitute equipment when covered property has been put out of service by a covered loss, subject to policy conditions. In addition, it includes coverage extensions for debris removal; equipment leased, rented or loaned to others; and construction trailers

 

Members of PALICA can have this insurance written this brand new program. If a contractor is not a member, a look at the website is a good idea. You will be able to see all the features and benefits at http://www.pennsylvanialica.com/.

 

LICA members have access to the LICA Contractor Safety Management Plan. The purpose of this comprehensive safety manual is to provide LICA members with recommended safe operating procedures and to outline techniques that are essential for the protection of the industry’s greatest asset “its people and equipment.” It is designed to be your individual company safety program or supplement to your existing program. It contains toolbox talks, equipment and jobsite inspection forms and much more. For your convenience a complete CD of the manual is included. This manual is worth thousands of dollars and is free to every contractor member.

 

For members who have college age children, LICA also has a scholarship program for active LICA Contractor members. The National LICA Education Committee awards several annual scholarships that are available to LICA members, spouses, children and grandchildren.

PALICA can help excavating contractors earn dividends on insurance premiums

July 20, 2014 in general liability insurance, insurance dividends, liability protection, LICA, Pa LICA

With the state of Pennsylvania now allowing excavating contractors to earn dividends on insurance premiums, some of the more expensive insurance options are more attainable. Business owners with large equipment can experience large headaches when machinery breaks down or some other disaster happens that has a negative effect on completing a contract on time. Standard general liability insurance does not cover the extenuating circumstances; however, this new program can have Contractor Error s and Omissions included in your policy.

 

Shortened to “E&O,” this specific coverage will protect the business owner against claims of faulty workmanship and materials, and against any resulting loss that can occur. These events would take place after the job was completed. Standard general liability excludes damage to your final product after the customer has signed off on the work.

 

Another area that is very important is that an excavating contractor can dig a ditch, grade a road or level a site for construction. The job is completed perfectly and without error. The next contractor in line may damage the original work through an error on his part. E&O will protect the excavator against damage to him after his portion of the job or project has been completed.

 

Then there is the issue of Professional Liability. Yes, your general liability will cover you when you are legally liable for injury or property damage to a third party. However, E&O will protect an excavating contractor when he is legally responsible to pay compensatory damages as the result of error, omission or negligent act while acting in the capacity of a contractor.

 

Members of the Pennsylvania Chapter of the Land Improvement Contractors of America (PALICA) can have E&O insurance written through this brand new program. This protection does qualify for the new insurance dividends incentive. Some states that have had this incentive in place for some time are seeing payments as high as 16% of the original insurance premium.

There are many other advantages of being a member of PALICA. One benefit is that LICA/PA LICA has a comprehensive safety program and works to provide members with updated information on complying with OSHA regulations. In addition, the organization works to keep members abreast of the latest laws and regulations affecting their businesses, and works to influence legislation for the benefit of business. LICA/PA LICA members gain useful advice from fellow contractors, establish new business relationships, and meet industry experts, equipment and material suppliers, as well as make new friendships.

While the insurance dividends help save members money, LICA also has a national “Petrocon” Program. The Petrocon program is designed to reduce operating costs and expenses for LICA members by reducing prices from 10-40% for commodities such as: lubricants and greases, antifreeze, tires, electric expense (in deregulated states only), and even wireless cellular expense. The program is designed for all sized companies; from the one-man operation to the very large company. This program is available to both the contractor and associate member providing they are a member in good

 

Excavating Contractors can protect their companies and earn insurance dividends

July 15, 2014 in dividend earning insurance, general liability insurance, LICA, united fire group

Without an Excavating Contractor no residential or commercial site could ever be developed. These companies use very large and very expensive machinery to level and grade lots, haul dirt, site preparation, trenching and many other jobs that require working in the ground. Along with big jobs and big equipment comes the risk of big injuries. Every Excavating Contractor knows that his general liability insurance is his lifeline.

 

If the contractor owns or leases certain types of heavy machinery it may qualify him to do more specialized work like grade roads, dig sewers, excavate ditches for power or sewer lines, and many other hard jobs. When the excavating contractor has won a bid for a particular job, the land owner or general contractor will usually require proof of general liability insurance with certain minimums before the business owner can move his machinery onto the property.

 

Every business owner wants to hire the most skilled workers that he can afford. But no matter how skilled, how educated or how experienced a worker can be, there will always be accidents. An accident is ‘an unfortunate incident that happens unexpectedly and unintentionally, typically resulting in damage or injury.’ When a dump truck backs into an automobile and loses several tons of dirt on the vehicle and owner, the words “I’m Sorry” do not carry much weight.

 

Sometimes there is real damage and injury; other times it is either not as great as stated or non-existent. The excavating contractor does not have time to complete his contract and attend to small or large legal matters. This is where the general liability insurance comes into play. The insurance company will handle all legal matters, hire any investigators necessary and provide legal assistance if the case goes to court. If the contractor is found not to be negligent or at fault, legal fees will still be paid.

 

Residents everywhere in Pennsylvania are aware when an excavating contractor hits a water line, gas line or electrical line when digging on a new project. There is nowhere to hide. The event is covered by every television station and newspaper. Traffic is jammed for hours. Residents are without water, gas or electricity for hours at a time. Businesses have to close.

Sometimes it is not the contractor’s fault. Calls were made to the appropriate utility and someone dropped the ball. However, all eyes will be on the contractor and someone will have to pay.

 

General liability insurance for excavating contractors can be very expensive. What many of these business owners do not know – who are not members of LICA – is the State of Pennsylvania has approved an incentive where contractors can earn dividends on their general liability insurance. In some states the insured are already receiving as much as 16% of the insurance premium. This is one of the many benefits of being a member of the Pennsylvania Chapter of the Land Improvement Contractors of America. For members of LICA, the dividend-earning insurance is written through a brand new program exclusive to LICA members.

Implications of Flood Reform on Your Flood Insurance Rates

February 25, 2014 in biggert-waters act, biggert-waters flood insurance reform act, elevation certificates, fema, flood insurance, flood insurance elevation certificate, flood insurance rates, national flood insurance program, nfip

The Biggert-Waters Flood Insurance Reform Act of 2012 was seen by many as long overdue legislation aimed at the country’s National Flood Insurance Program. After the likes of Katrina and a handful of other hurricanes and tropical storms put the national program $24 billion into debt, it was clear that measures had to be taken to make the NFIP more stable.

The BW-12 and Insurance

One of the ways the Biggert-Waters Flood Insurance Reform Act of 2012 sought to enact meaningful change was by adjusting the insurance rates they offered, so as to make them better reflect the risk that customers actually faced.

This doesn’t mean everyone will see their rates increase, of course. However, events leading up to the Biggert-Waters Flood Insurance Reform Act of 2012 made it clear that some areas were grossly underpriced for insurance, given what their true risk really was.

Your Insurance Rates

As everyone will be affected differently by the Biggert-Waters Flood Insurance Reform Act of 2012, it behooves everyone to look into what their insurance rates will now be. Many people who think they are untouched by legislation may find an unpleasant surprise in the Act.

Two groups are especially vulnerable under BW-12, in light of their historical insurance rates.

Buildings that Sit Below Base Flood Elevation

The Base Flood Elevation (BFE) is the elevation required under the National Flood Insurance Program, where a structure needs to be flood-proofed. It’s the level floodwater is anticipated to reach during a base flood.

In the past, many building owners received discounted rates from FEMA, despite falling below BFE. The BW-12 now puts an end to most of that. So, even if your building was up to code when you had it built, if it falls under BFE now, you can expect to pay more.

Structures that Had Been Grandfathered In

Many building owners have benefited from having their original rating grandfathered in, even after better information came to the table. Under BW-12, most of those scenarios will no longer stand.

For example, these included structures built before 1975 or before their local area was assigned a Flood Insurance Rate Map. Many buildings in these instances were insured with pre-FIRM rates. BW-12 will more than likely make rates in these situations increase.

Though the reform was long overdue and comes with the best intentions, many people will find that it means they’ll be paying a lot more in the future. Give us a call at Williams Agency to discuss how it might be affecting you. We’re one of the few agencies that can offer you coverage without requiring an expensive elevation certificate.

Sources:

http://us.stormsmart.org/2013/01/07/what-flood-insurance-reform-means/

http://www.fema.gov/flood-insurance-reform-act-2012

http://www.fema.gov/national-flood-insurance-program/base-flood-ele

HDPC Review Sheds Light on Biggert-Waters Act

February 22, 2014 in biggert-waters act, biggert-waters flood insurance reform act, national flood insurance program, nfip

On Monday, January 27th, lawmakers from both sides of the aisle congregated at a House Democratic Policy Committee to hear from homeowners, home finance professionals, and housing experts on the negative impacts being felt thanks to the Biggert-Waters Flood Insurance Reform Act of 2012.

The Biggert-Waters Flood Insurance Reform Act of 2012

Back in July of 2012, the Biggert-Waters Flood Insurance Reform Act of 2012 was passed by Congress as a means to dig the National Flood Insurance Program out of debt. Though it had operated smoothly since 1968, NFIP found itself $24 billion in debt after Katrina and other hurricanes and tropical storms destroyed coastal cities over the past 10 years.

Unintended Consequences

Though FIRM was passed to help pay for natural disasters in the future, it has caused a number of financial disasters in the present. Obviously, the only way to help get the NFIP out of debt was by increasing the costs of rates the program subsidized. However, these costs didn’t just increase, they skyrocketed. Across Pennsylvania, homeowners have reported seeing their rates doubling and even tripling. There have even been reports of some homeowners experiencing insurance rates that went up tenfold.

The increase in costs has just been the primary effect, however. With these increased insurance rates comes a decrease in property values. Many are predicting that an uptick in foreclosures can also be expected if this continues.

Due to the uproar, Congress voted to delay increases in premiums for policies that were grandfathered in until September of this year.

Further Delays

However, on the same Monday Pennsylvania lawmakers were collecting to hear about FIRM, the Senate voted to begin debating legislation that would delay the majority of increases by four years.

The vote passed 86-13, further highlighting the weight of the consequences carried by this bill. That said, the White House has made it known that a veto could be imminent. Nonetheless, with 26 more votes than what was needed to pass, it’s obvious that Pennsylvania is far from the only state struggling to make sense out of and/or handle the increases demanded by FIRM.

Williams Agency is happy to be able to offer Pennsylvanians the flood insurance they need at significantly reduced rates. For one thing, our agency doesn’t need to require elevation certificates like so many of our competitors do. Those savings alone can mean as much as $1,000 back in your pocket.

Sources:

http://www.fema.gov/flood-insurance-reform-act-2012

http://www.pahouse.com/Haggerty/index.asp?pg=PAHouseNews&doc=35961