Tis the season

Insurance Audit season that is. It seems every contractor we do work for is scrambling this time of year to get the certificates of insurance in so they don't get charged premium for our work. This is a good thing - we pay for the insurance and it forces the contractors to use lagitimate companies or they will get charged.

What I'm having a problem with is them asking to be listed as "additionally insured" on my policy. This costs $103 per additionally insured. We do work for over 20 contractors - this could hurt. I've told a few of them (the ones we have done less than $1000) "we can only do that if you pay for the additional premium". I can only get pushed so far, we already carry much hire limits than needed, pay to much for to little - it just never ends. Two grand on work we have already done (when this cost was not in the price of the work) at the end of the year sucks!
Tim
609 597 4449

We only have two folks that have the squirrely Additional Insured requirement. The other contractors only ask for Certificates, not to be listed specifically. Are all of your contractors asking to be Additional Insured? I do believe that if that's what you're starting to see, I'd be putting some additional language in my contract....ie, we will pay 25% of additional premiums required to fit your needs and you will pay the balance - prior to beginning any job. It's stupid for all of that language to apply to our line of work anyway.....I can see where it's important for the roofing industry or framers cause hey, I've never seen a clean driveway decide to fall on someone's head or have a house wall fall down after being washed. Then again, maybe your issue is state specific.

Usually the auditing comes through the Workers Comp end and yes, if they don't have Certs from their subs, it does affect their WC premiums (I know, we just got whacked!)

Celeste

Celeste, You are lucky, only two so far. But, you are in the south and it takes a while for things to catch there (ha, ha). I think it is a way for the industry (insurance) to get more money out of their clients. I was told by my agent that "the reason they ask to be labeled as additionally insured on my policy is if my company does something to cause a loss, they will use my insurance until it is exausted before they get into the 'general contractors' coverage. Well, dahhhh, I'm sure that is how it would go down anyway.

I bet this becomes something that I/we all start putting into our prices as "a cost of duing business".

Tim McCulla
P.S. I hate to sound so negative or full of hate for the insurance people because I am truly in a great mood. I went fishing today and caught more fish in on hour (17 - until I ran out of bait) than I caught all year. I was home by 9:00 am and spent the day with my baby girl. What could be better? I just hate these people digging into my pocket year after year.

All of my customers require the additional insured labels on the certificates they request. I never have to pay for the service. I don't understand why the insurance companies require you to pay for the service. I would bet that it is your agent. I also don't pay for certificates or anything else like that. In my opinion, it should be provided as part of the service.

Scott Stone

I also do not have to pay to have someone labled as additional insured. I can add as many as I need at any time for no fee.

There is a difference in having a Certificate of Insurance issued to John Doe Contracting than having John Doe Contracting as an additional insured. The additional insured is a rider that is attached to the main policy and there is generally an extra premium of between $50 - $100 per additional insured. It does offer them the protection of having your insurance raped completely before their's gets started on. Usually the contractors that require this are the ones with endless pockets and they want every ounce of butt coverage that they can get. It is unfortunate that we small guys are the ones who must pick up the tab but if you want to play with the big boys, it's, as Tim says, "a cost of doing business". If someone pushes that button with us, we simply work the additional cost into the figure somehow, just as working in gas increases, material costs, etc...

Celeste