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Contractors insurance #157233
09/21/05 05:18 PM
09/21/05 05:18 PM
kdal  Offline OP
Joined: Sep 2005
Posts: 34
This is a very long post so please bear with me for I feel it to be of importance to all contractors.I was recently reading a post from july concerning liability and insurance.
Luckyshadow mentioned a $400 policy. To summarize LK's response a $400 policy probably wasnt enough insurance for a contractor.
This got me wondering about my own policy because I am only paying $700 per year.
I decided to open a can of worms by sending an email to my insurance company outlinig what I do. I figured it would cause me trouble and it did, but I wanted to make sure I was covered for the work I do.
Now I am looking for a new policy because they said when my existing policy runs out they cannot renew. They offered no detail
but I am trying to find out more.I know other contractors who use these same policies.I understand that some of the things that I listed are extreme cases but from what I can gather something as simple as digging a trench is not covered. My written policy is very vague on detail and so is the person who sold me the policy.
Here is the letter That I submitted.
Dear Sir or Madam:
This is a reasonable general breakdown of my job duties as an electrical contractor In Florida.
Included is a list of the types of locations and facilities that I may be called to work at, types of equipment required to complete my job assignments, expected working heights, types of voltage that I will be exposed to and types of equipment that I may be required to work on and around.
I would like to know which of these activities outlined below are covered by my existing policy and which are not.
I would also like to know when coverage begins and when it ends
on work performed by me. Is my policy concurrent?
I do not want to engage in any activities for which I am not covered and will gladly discontinue any practice which is questionable or that may not be covered by my policy.
In general, all the electrical contractors I know and including myself must perform electrical maintenance and construction both inside and outside of buildings.
To complete a project I am sometimes required to dig holes and or trenches usually not exceeding three feet deep, by hand using shovels, picks and other manual digging devices or with machinery such as a ditchwitch (trencher) or backhoe. This digging is required to access existing electrical systems for maintenance, repair and or alteration as well as to facilitate the installation of new electrical systems and or components.
To prevent damage to previously buried equipment, I consult local authority, site supervisor, owner etc. for information/permission before digging as well as calling 1-800-NOCUT as required.
I sometimes must work above the ground on walkways, platforms, ladders or mechanized equipment approved for lifting personal.
Working height does not exceed 24 feet as outlined in my existing policy and I will be using approved fall protection.
I will need to perform construction, maintenance, service and or repair of electrical equipment inside and outside of a facility including electrical service equipment ending at the point where the power company connects to serve the facility.
Alternating and direct current voltages that I may encounter will range from less than one volt up to and including 2300 volts.
The types of facilities and equipment I will be working on may include but are not limited to the following examples.
Residential, single and multi family dwellings.
Wiring of new homes as well as maintenance and or repair of existing electrical equipment and systems.
Commercial, hotels, motels, restaurants, gas stations, manufacturing facilities, marina’s ect.
Electrical distribution, lighting, cooking, material handling, and associated equipment.

Industrial, Papermills, sawmills, rock quarries ect.
Electrical distribution, lighting, material handling, and associated equipment.

Business, Office, Estimating, Legal:
Re: Contractors insurance #157234
09/21/05 05:40 PM
09/21/05 05:40 PM
Tiger  Offline
Joined: May 2005
Posts: 706
Crystal Lake, IL USA
Send a copy of that letter around to some other insurance companies. The trenching might make it expensive, but it's best to be covered. Don't worry about the old company, be glad you're through with them.


Re: Contractors insurance #157235
09/21/05 07:01 PM
09/21/05 07:01 PM
electricbill  Offline
Joined: Feb 2005
Posts: 20
chester ny usa
i would go to insurance companies experienced in the contracting trades.visit them personally(call first). they will tell you what they cover,what is expensive to cover,and what they WON'T cover. you can decide your coverage from there.
i got canceled because i put down that i do 10% alarm work.I don't do alarm work ,but figured i'd put it down to cover my @ss.

Re: Contractors insurance #157236
09/21/05 10:51 PM
09/21/05 10:51 PM
kdal  Offline OP
Joined: Sep 2005
Posts: 34
Hello LK
Glad you made it to this topic. And thanks for the original insight that got me cheking around. Could you tell me what would be a ball park figure of a policy that would suit my needs?

Re: Contractors insurance #157237
09/21/05 11:21 PM
09/21/05 11:21 PM
Jps1006  Offline
Joined: Jan 2004
Posts: 615
Northern IL
I raised some of these issues with my insurance gal and she assures me that I am covered under all these circumstances, but my policy states wiring inside buildings. I told her I do outside, trenching etc. She said its okay, it's covered. The inside wiring description is meant as a classification, a general description of what kind of work I do.

Re: Contractors insurance #157238
09/21/05 11:31 PM
09/21/05 11:31 PM
kdal  Offline OP
Joined: Sep 2005
Posts: 34
Thats exactly what I went through with my company my agent kept assuring me I was covered until I took my lawyers advice and sent the email. That made it hard for them to bs me because it was all in writing.

Re: Contractors insurance #157239
09/22/05 06:14 PM
09/22/05 06:14 PM
Tesla  Offline
Joined: Jun 2004
Posts: 1,273
Sacramento, CA
The insurance industry has been really burned out in California due to some horrificly bad apartment and condo projects -- especially in San Diego. The damages pretty much amounted to scraping the condos down and rebuilding them -- with the GC and subs taking the fall all of the way.

This project fed enough meat to the trail lawyers so that pursuing contractors for mega-claims has become institutionalized.

Now insurers are bumping up -- really bumping up -- the premiums charged to contractors active in:

New Construction Tract
New Construction Condo/ Multi-family
New Construction Custom Homes

The insurers are not going nuts over service electricians -- but they are going to be re-rated just the same.

Re-rating usually starts out with expanding exclusions which trigger more 'riders'.

Re: Contractors insurance #157240
09/23/05 11:52 PM
09/23/05 11:52 PM
Active 1  Offline
Joined: Feb 2003
Posts: 687
Grayslake IL, USA
I had a problem with an insurance company because they realized later there was something on the application they did not like. I got a letter they would drop us because we provived electric for hot tubs, pools, & hydro masauge tubs. Talking to them they insisted it is not considered with-in the scope of an electrician to do this. They thought the pool guy or plumber should do it. WTF! Of coarse they had a high risk and price policy they could give me.

I found a new insurance company (Country) that is cheaper and is more geared for contractors after asking around. They did not have as many dumb questions on the application. Many companies seem like they use the same policy no matter what biz your in.


Re: Contractors insurance #157241
09/24/05 01:10 PM
09/24/05 01:10 PM
LK  Offline
Joined: Jan 2003
Posts: 1,429
New Jersey
'They did not have as many dumb questions on the application.'

These dumb questions are what the underwriters, need to know, to give you proper coverage, every business needs a risk assement, the number of years in business, the qulaifications of the applicant, the type of work you are doing, limits of coverage, all reflect the rates, accepting a policy without proper limits and coverage, may cause you to loose out, on some jobs that require these coverages and limits, and if for any reason should you have a loss and are under insured, or not properly insured, you may be facing a sizable judgement.

With a good contractors policy, you should have a 2 or 3 page application process, without this the red flag should go up.

[This message has been edited by LK (edited 09-24-2005).]


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