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Fryar Insurance Services
& Risk Management

22320 Foothill Blvd. # 130
Hayward, CA 94541

Phone: (510) 583-2203
Fax: (510) 583-2204

Insurance Terms

Acord Insurance Certificate
A certificate of insurance commonly issued by insurance agents on behalf of their clients to indicate to other interested parties the nature and amounts of insurance purchased by the client. The ACORD certificate form was developed by the insurance industry in an attempt to standardize and simplify this type of insurance documentation. This form does not provide insurance coverage. An endorsement or insurance policy is needed for that purpose.

Advertising Injury
An injury arising out of a negligent act, error or omission in the rendering or failure to render professional advertising services.

One who has authority to act for another. An insurance agent acts for an insurer by soliciting buyers of insurance and providing them service on behalf of the insurer. See "broker".

Aggregate Limit
A cumulative limit that applies to all claims within a given period of time, such as within one year, or within the policy term. For example, if a policy has an occurrence limit of $1 million and an aggregate limit of $1 million, the policy could be exhausted by a sequence of losses totaling $1 million, or by one big loss of that amount.

Aircraft Liability Insurance
Aircraft liability insurance protects owners and operators of aircraft against liability for injury to other people or damage to the property of others arising out of the ownership or use of aircraft. Occasionally, aircraft may be used to photograph a construction site, or a helicopter may be used to place equipment on roofs. This exposure would be commonly found on construction projects that require the use of helicopters to place equipment on building tops by mechanical or electrical trades.

Aircraft/Watercraft Liability
Because the coverage for aircraft and boats is limited, any such exposure deserves careful review and possibly additional coverage. Perhaps employees should be instructed not to use private planes or boats in connection with their employment.

Automobile Liability Insurance
This coverage insures against liability claims arising out of the insured's use of automobiles. The term "auto" is defined in the Insurance Services Office Commercial Auto Coverage policy as "a land motor vehicle, trailer or semi-trailer designed for travel on public roads but does not include "mobile equipment".

Bodily Injury
Bodily injury, sickness or disease, including death.

Broad Form Drive Other Car (D.O.C.)
If someone who drives a company vehicle has no car of his own, he or she is unlikely to have a personal auto insurance policy. Therefore, he or she may not be covered while driving someone else's car in an activity unrelated to work. Coverage can be added to the Business Auto policy to allow that individual to drive someone else's car.

One who, for a commission from the insurance company, solicits, negotiates and services insurance policies on behalf of the insurance buyer. From a practical standpoint, there is little or no difference between a broker and an agent in terms of providing insurance to a California insured.

Builder's Risk Insurance
Builders risk insurance, also known as Course of Construction (COC) is a type of property insurance that addresses the special needs of construction projects by insuring property already in place but under construction, as well as equipment and materials to be installed.

Building Code Updating
The cost of repairing or reconstructing damaged buildings can far exceed estimates if the building must be demolished or upgraded to comply with laws relating to:

a. Earthquake safety
b. Handicapped access/ADA
c. Life safety (e.g. sprinkler system)
d. Other requirements

Your present coverage pays for "like kind and quality" but coverages for upgrade expenses are available.

Business Income/Extra Expense
Business Income will pay for the actual loss of Business Income you sustain due to the necessary suspension of your "operations" during the "period of restoration". Suspension must be caused by direct damage to your covered property caused by an insured peril. Coverage also applies to continuing expenses, such as payroll and rent, and extra expense that indemnify you for necessary expenses over normal expenses incurred during the "restoration period". (The Biotechnology Program Form has been revised to fund continuing expenses despite lack of income - it will fund your "burn rate".)

Claims-Made Coverage
A type of liability coverage that imposes strict deadlines regarding timing of claims by plaintiffs and reporting of accidents and claims to the insurer. Although not widely used for general liability coverage, it is common enough that you can expect to encounter some insurance written on these forms, specifically "professional liability" coverage. In its most fundamental form, "claims-made" coverage responds to claims made during the policy term, regardless of when the triggering accident or event happened. In the case of an injured child, for example, the policy that would respond would be the policy in effect at the time that the child made a formal claim, even if years after the event (minors may present claims after reaching their majority). However, most claims-made policies have a "retroactive date". Claims arising from events that occurred before the retroactive date are not covered. Usually the retroactive date is the first date that the insurer began providing liability insurance for that insured. Renewal policies often keep the same retroactive date as the expiring policy.

Computer Fraud
This coverage form provides insurance for the loss of money, securities and other property caused by computer fraud. The term "computer fraud" refers to theft through the use of a computer to transfer covered property fraudulently from inside the insured's premises or a banking premises to a person or place outside those premises. For instance, a fraudulent transfer of money from the insured's bank account to a thief's bank account could be accomplished and then covered up by computer manipulation. Such a theft loss would be covered as computer fraud.

Contingent Business Income (Domestic or Foreign)
This coverage would protect you for income loss or extra expenses due to damage to the premises of specified suppliers, customers or subcontractors by a covered peril.

Credit Insurance
Coverage is available to protect your company against bad debts resulting from your customer's inability to pay for your products. The insurers are selective and the minimum premium can amount to $25,000. This coverage can reduce your risk of selling in the international marketplace.

Cross Liability Clause / Separation of Insureds Clause / Severability of Interest Clause
These are various names for language found in liability policies which states that the terms of the policy apply separately to each insured, as though a separate policy had been issued to each. An exception is made for policy limits: the policy limits apply collectively to all insured.

Damage to Insured's Products
Products Liability excludes damages to the products that you manufacture, sell, handle or distribute when the damage is caused by your products, or any part of them. Your present Products Liability insurance would cover the resulting damage to other property, but not damage to the unit itself.

Difference in Conditions
Covers company for direct losses to business personal property from perils excluded under "Package" policy, most notably earthquake and flood.

Directors & Officers Liability
This coverage protects individuals against allegations of "wrongful acts" in the course of their duties as directors or officers. A completed application is required before a quote can be obtained.

Earthquake & Flood
Your property insurance policies exclude earthquake and flood damage. Coverage is available based upon location and limits required. Deductibles of 10-15% of total property values generally apply along with minimum premiums of $20-25,000.

Earthquake Sprinkler Leakage
Property insurance policies have generally excluded the peril of earthquake. They have, however, often included coverage for leakage from overhead sprinklers caused by earthquake (Earthquake Sprinkler Leakage or EQSL). As a result of the Northridge quake of 1994, insurance companies suffered substantial loss due to this coverage. Therefore, Earthquake Sprinkler Leakage is no longer included in your coverage, but an option to buy back coverage is available.

Electronic Data Processing Property
Electronic data processing equipment, electronic data processing media, and telephone equipment.

Electronics or Software Errors & Omissions Liability
General Liability typically provides coverage in the event of bodily injury or property damage caused by your product. You have no coverage for allegations that your product failed to perform as promised, thereby causing financial loss to your customer. Electronic or Software Errors & Omissions covers your company for lawsuits resulting from mandatory damages caused by a failure of your software or electronics product to perform.

Employee Benefits
Provides employees with medical, life, disability benefits, 401(k), and other benefit plans.

Employee Benefits Liability
Provides coverage for sums an insured becomes legally obligated to pay because of negligent act, error or omission of any insured in the "administration" of the insured's "employee benefit" programs.

Employee Dishonesty
Covers an organization against loss of money, securities, and other property by employees.

Employment Practices Liability
Insures companies against a broad spectrum of employment-related claims including but not limited to: Wrongful Termination, Sexual Harassment, Discrimination based on race, color, religion, national origin, age or sex, Discrimination due to pregnancy, and Discrimination of individuals with disabilities or life-threatening illnesses. It provides defense for companies and employees who are defendants in a lawsuit, and it covers a wide range of monetary damages.

Equipment Maintenance
Provides management service as an alternative to traditional maintenance service contracts.

ERISA (Employee Retirement Income Security Act)
Establishes requirements governing pension and welfare plans including communications, disclosures and reporting.

Excess Liability Policy
Increases total liability coverage limits of underlying policies.

Exhibition/Trade Show Coverage
This coverage may be automatically included if you have Transit and Any Other Premises coverage. It must be insured separately if the location of the Exhibition is other than the U.S. or Canada.

Extended Period of Indemnity
Business Income typically provides coverage during the time it takes to repair the damaged premises. However, business may be slow in those first few months following completion of repairs or relocation, and loss of income may continue. Business Income coverage can be extended to pay some or all of that additional loss.

Extortion, Kidnap, & Ransom Insurance
Wealthy and prominent individuals, as well as corporations, can be a target for extortion, kidnap and ransom. This type of insurance can be purchased to cover ransom money paid following:

a. A threat to injure an insured person, and
b. A threat to damage the Insured's property

Also covered would be all reasonable professional negotiator expenses including bodyguards, transportation and communications expenses. The cost for this type of coverage is relatively modest.

Fiduciary Liability
There is a fiduciary liability exposure to the trustees of any benefit plan such as a pension or profit sharing plan [including 401(k)]. Fiduciary Liability coverage would pay, on behalf of the plan trustees and the company, all sums that would be legally obligated to be paid because of a "breach of fiduciary duty". This breach means a violation of responsibilities, obligations or duties imposed upon fiduciaries by the Employee Retirement Income Security Act (ERISA) of 1974.

Foreign Liability
Your liability insurance covers suits brought in the U.S. or Canada. Uncovered losses can result from overseas travel, selling your product overseas, or other exposures outside North America.

Foreign Property
Business personal property in the U.S. and Canada is covered, but you do not have coverage for property elsewhere (such as trade shows or sales offices at foreign locations).

Foreign Voluntary Workers' Compensation
Foreign Voluntary Workers' Compensation/Employers' Liability insurance can be tailored to provide benefits for U.S. workers abroad, Local employees, and/or Third Country Nationals. It allows employees on temporary or extended overseas assignments to collect Workers' Compensation benefits available in their country of origin. It also includes coverage for repatriation (return of insured worker to their home country) and endemic disease. The Employers' Liability part of this coverage applies on a primary or Excess basis, depending on local laws. This coverage is underwritten based on:

Number of trips under and over 30 days, and
Payroll for U.S. workers abroad, Local employees, and other foreign Nationals.

General Liability Insurance
Commercial General Liability coverage was introduced in 1986. The form provides protection against bodily injury and property damage claims arising from the operations of the insured. This type of policy provides coverage for premises and operations, use of independent subcontractors, and products and completed operations. Major exclusions include liability arising out of the ownership, maintenance or use of water-craft, aircraft and automobiles, and professional liability. These exposures are normally covered by other insurance policies.

Hired Auto Physical Damage
Provides comprehensive and collision coverage, subject to a deductible, for damage to rented vehicles.

Insurable Interest
The kind of exposure to financial loss that a person/entity must possess in order to have insurance coverage that is legally enforceable.

Intellectual Property
Covers third party liability, defense and indemnity costs incurred by the company in suits claiming infringement of patent, copyright, and trademark. (Offensive coverage is also available which would provide funds to pursue alleged infringers of your product/process)

Key Employee Insurance
This will protect the company against financial loss resulting from death or disability of a key employee.

Limit of Liability
The maximum amount of money a policy will pay in the event of a claim. Depending on the type of policy, defense costs may or may not be included in the Limit of Liability.

Mechanical breakdown/Boiler & Machinery
Although you may not have boilers at your locations, there is an exposure to loss on certain equipment such as air conditioners, transformers, generators, electrical panels, refrigerators, centrifuges and other types of mechanical laboratory equipment. Traditional personal property and business interruption forms exclude losses caused by electrical disturbance, power surge or mechanical breakdown. The property form for Biotechnology firms can include this coverage simply by the addition of an endorsement deleting these excluded perils.

Monopolistic States Workers' Compensation
If you have employees in North Dakota, Ohio, Washington, West Virginia, or Wyoming you must obtain Workers' Compensation coverage from the state. We cannot add it to your program but we can provide assistance if you notify us. Maine and Massachusetts are other states that may require special handling.

Non-Owned & Hired Automobile Liability
Covers company for claims resulting from bodily injury or property damage arising from use of rented or employee-owned vehicles.

An accident, including continuous or repeated exposures to substantially the same general harmful conditions. NOTE: Many policies have a different definition of "occurrence" and what triggers a claim. Please review the Definitions Section of your insurance policy

Occurrence Form
Insurer is responsible only for claims where the bodily injury, property damage or wrongful act occurred during the policy period.

Occurrence Limit
The most the insurer will pay for any one occurrence.

Off Premises Disruption of Utilities
Standard Business Interruption forms cover a direct loss of income and continuing expenses due to an insured interruption of production on your premises. This does not contemplate an indirect exposure such as a shutdown or power outage at your local power station. An off premises power extension, when added to Business Interruption, would cover this exposure subject to an 8-hour deductible. Such coverages can also be broadened to include water and phone lines. Coverage may also be extended to direct damage to work in process caused by a power failure.

Patent Litigation Coverage
Insurance coverages are available for:

a. Defense of patent infringement allegation, or
b. Expenses related to enforcement of patents

Personal Injury
Injury other than "bodily injury" arising out of one or more of the following offenses: false arrest, detention or imprisonment; malicious prosecution, wrongful eviction, libel, slander, violation of the right of privacy.

Political Risk / Expropriation Coverage
Companies with worldwide operations are generally concerned with the potential for contract repudiation and/or expropriation of assets by a foreign power. Insurance can be purchased to cover these exposures and reduce the uncertainty of operating worldwide.

Pollution Liability
Standard Commercial General Liability and Umbrella Liability policies absolutely exclude pollution. In order for this exposure to be covered, a specific Pollution Liability policy would need to be purchased. Additionally, damage to your own property (as well as clean-up expenses) resulting from pollution is limited on the Property policy. Minimum premiums in the range of $5,000-10,000 are to be expected because the required surveys can be expensive. The Pollution Liability exclusion has been interpreted so broadly by some insurers that liability resulting from such things as bleach spills, paint overspray, and/or gardener's insecticides may be excluded.

Pollution / Contamination of Your Property
Property policies provide only nominal coverage ($10,000 or less) for clean-up of contaminated property following a covered loss. If your company has a serious exposure that could result in contamination of your own property and large clean-up costs, consideration should be given to increasing this limit or purchasing specialized coverage.

Premises/Operations Liability
Bodily Injury or Property Damage arising out of the physical hazards of the insured's premises or operations and occurring on premises owned or rented to the insured. The most common example is the "trip and fall" exposure

Product Recall, Contamination
Though such exposures are not covered in your insurance program, they may be available.

Products/Completed Operations
Bodily Injury or Property Damage occurring away from premises owned or rented by the insured arising out of the insured's "product" or "work" except:

a. Product still in the physical possession of the insured, and
b. Work that has not been completed or abandoned. Clinical trials are covered on a Products Liability form.

Professional Liability
May also be referred to as Errors & Omissions. Covers company for lawsuits resulting from monetary damages caused by a failure of your software or electronics product to perform.

Covers company for direct losses to equipment, computers, furniture, fixtures, leasehold improvements, etc. resulting from fire, windstorm, theft and other perils.

Property at Any Other Location
Business Personal Property at your premises in the U.S. and Canada is covered, but you do not have coverage for property elsewhere such as a temporary warehouse while in transit, at a contract research organization or other premise not stated on the Declarations Page of the policy. The Biotechnology form does include a limited amount of coverage for Any Other Location and this limit can be increased.

Property in Transit (Domestic or International)
Coverage is available for goods in transit domestically, internationally or worldwide.

Protection & Indemnity Insurance
This coverage protects boat owners or permitted boat users against liability arising out of use of the boat. Insureds who may use a boat in their operations should secure this type of insurance.

Research and Development Documents
Because the technology industry is predicated on technological advancement, technology firms spend a great deal on research and development. Start-up companies with little or no income are using capital that may be irreplaceable to develop and introduce products into the marketplace. For many companies, the loss of research and development documentation processes or cultures and resulting products or samples can have a disastrous financial impact. The Loss of Research and Development Documentation form not only covers the cost to reproduce research and development documentation, processes, or cultures, it also provides extra expense coverage to enable you to get interrupted projects back on track.

Research Animals
A standard property form excludes coverage for animals. The Biotechnology property form includes coverage for Research Animals. They are valued on the cost to purchase a replacement animal of the same kind and quality as the one destroyed by a Covered Case of Loss. The form automatically includes a limited amount of coverage and this limit can be increased.

Retroactive Date (also: Retro Date) on a Claims Made Form
For coverage to apply the wrongful act must have occurred after this date (and, of course, the claim must be made during the policy term).

Salesperson's Samples
Business Personal Property that is in the custody of any one salesperson but used only for sample purposes.

Self-Insured Retention (SIR)
The amount of loss for which the insured agrees to be responsible before the insurer begins to participate in a loss. Unlike a deductible, the insured is usually responsible for handling claims within the self-insured retention.

Umbrella Liability
An umbrella liability policy:

a. Raises the limits of all "primary" or "underlying" liability insurance policies; and
b. Provides coverage in some areas not covered under primary policies. Umbrella policies are sometimes used in conjunction with a primary liability policy by an insured to provide sufficient limits to meet contract requirements.

Valuable Papers and/or Accounts Receivable
Property insurance does not adequately cover:

a. The inability to collect your receivables, or
b. Lost information that must be reproduced as a result of damage to your records by a covered peril.

Though coverage is inexpensive for these exposures, the best protection is duplication of the information stored at another location.

Workers' Compensation & Employer's Liability Insurance
Workers' compensation insurance provides statutory protection against bodily injury, sickness or disease sustained by employees while in the scope of their employment. Employer's liability coverage is included in standard workers' compensation policies. It covers common law claims of injured employees made in lieu of or in addition to workers' compensation claim. If the insured's employees will work around shipyards or docks, then U.S. Longshoremen and Harbor Workers' coverage is required. Maritime workers need Jones Act coverage. In a few states, employers are required to purchase workers' compensation coverage from a monopolistic state fund established for that purpose. In other states, state fund coverage may not be mandatory, but is the most commonly encountered insurer for industrial accidents. Those states where you can expect to see monopolistic state fund coverage instead of workers' compensation insurance from a commercial insurer include Nevada, North Dakota, Ohio, Washington, West Virginia and Wyoming.

Real Estate Terms

Accounts Receivable
The destruction of your accounts receivable records by fire or other perils could result in the inability to collect amounts owed to you. Accounts receivable insurance covers any interest on loans made necessary because of the inability to collects accounts, collection expenses in excess of normal collection costs, and expenses incurred to reconstruct the accounts receivable records. It also covers payments due to you that cannot be collected due to loss of the accounts receivable records.

Boiler and Machinery
Boiler and Machinery equipment is not excluded from coverage under a property policy as long as the damage is caused by a covered peril such as fire or windstorm, etc. However, any damage caused by explosion, mechanical breakdown or electrical damage is excluded but covered by a Boiler and Machinery policy. Boiler and Machinery insures equipment that generates, uses or transmits power i.e. plant production and maintenance machinery, air conditioning equipment, heating and refrigeration equipment etc.

Borrowed Equipment
When equipment is borrowed, and no contractual agreement exists, you might be held liable for any damage to the equipment. You would generally have no coverage for such liability under the general liability insurance. If this exposure exists, this coverage should be considered.

Builder's Risk (course of construction)
This coverage provides insurance for property in the course of construction and is generally written by the owner or general contractor responsible for the job. A Builder's Risk policy will cover property intended to become a permanent part of the structure while located in, or within a specified distance from the construction site. Such covered items include machinery and equipment that will service the structure as well as building materials and supplies owned by the insured.

Builders Laws
The standard replacement cost insurance policy replaces property damaged by an insured perils, new for old - same kind and quality. However, the enforcement of current building codes could increase the cost of repair beyond that which is reimbursable by the standard property insurance policy. Building code coverage can be purchased to cover three such losses: Demolition pays for the cost to demolish the undamaged portion and clear the lot. Increased Cost of Construction pays the cost to repair or rebuild the damaged portion with a higher grade of construction to conform to current building codes and contingent liability pays for the cost to upgrade the undamaged portion and/or to rebuild the undamaged portion which had to be demolished.

Business Income Insurance
This coverage pays for loss of earnings when operations are stopped, suspended or interrupted because of a covered cause of loss.

Citizen's Band Radio Coverage
This endorsement alters the exclusion for loss of or damage to citizens band radios, two-way mobile radios, telephones and scanning monitor receivers. With this endorsement, physical damage insurance on any covered auto specifically described in the endorsement applies to loss to any permanently installed equipment of this type.

Computer Fraud
Fraudulent theft or transfer of money, securities or other property resulting from the use of any computerized equipment or system would be insured by this coverage.

Contingent Business Interruption Insurance
This coverage pays for the loss of earnings because of a loss to another business which may be one of your major suppliers or clients.

This coverage protects against the theft of company assets by employees. The coverage insures against property loss (including loss of money and securities and other property of intrinsic value) which results from the dishonesty of an employee. In addition, ERISA requires all pension, profit-sharing and 401 (k) plans to be bonded against fraud or dishonesty under a Fidelity Bond. The limit of the bond must be at least 10% of the assets of the plans up to a maximum of $500,000. The plans must be named on the bond.

Design-Build Liability
The professional liability (errors and omissions) exposure exists if you are a design-build firm or if you enter into a design-build contract and then sublet the preparation of the working drawings to an outsider.

Drive Other Car Coverage
This endorsement covers any named individual and their spouse while driving another person's car. This endorsement is added when the individual does not have a Personal Auto policy to cover their auto exposure, as, for instance, when the individual drives a vehicle that is registered to and insured by a Corporation. Any member that wishes to be covered must be listed.

Earthquake coverage is available. Some standard carriers will attach the coverage to a property policy, but the issuance of a separate Difference-In-Conditions policy is the usual procedure in California. Coverage is restricted and expensive, and is generally subject to a minimum deductible of at least 5 to 10 percent of the insured value.

Electronic Data Processing
Most businesses use computers. Separate EDP coverage is available and inexpensive. Typically EDP policies provide all risk coverage similar to that provided by property all risk forms but these specialty policies also include coverage for electrical and magnetic damage, mechanical breakdown and often temperature and humidity changes as well. The media coverage includes the cost to reconstruct software developed in-house. In addition, an EDP policy may provide for extra expenses or income loss resulting from the loss of EDP equipment, programs and data.

Employee Benefits Liability
This coverage is designed to protect an employer or administrator from liability in the event of an error or omission in the administration of employee benefit plans, or negligence in giving advice about these plans to employees. Normally this coverage would be attached to the Commercial General Liability policy.

Employment Practices
The widespread use of employment-related injury exclusions in general and excess (umbrella) liability policies has created a limited market for this specialty coverage addressing this particular exposure. The major types of employment-related injury claims are wrongful termination, discrimination and sexual harassment. This coverage is available on a claims-made basis through specialty insurers.

Equipment Floater
This coverage is designed to provide insurance against physical damage to equipment used by you in the construction process. To qualify for coverage, the equipment must be mobile in nature. Virtually any piece of portable equipment used by you can be insured under an equipment floater provided the equipment is normally used on the job and any storage of the equipment on your premises is incidental to its normal use away from the premises. The coverage can be provided on a scheduled (providing the description of the equipment and its insurable value) or unscheduled (for small items such as miscellaneous or employees' tools and equipment).

Extra Expense Coverage
Damage to or destruction of your office location could present problems in that you will probably need to continue your office operations at a temporary location. There are extra costs associated with continuing office operations at a temporary location such as rent of the premises, renting equipment, overtime for employees etc. The Extra Expenses coverage provides the additional money necessary for your business to continue to operate after direct physical damage to your property from a covered cause of loss. The Extra Expense coverage allows you to relocate if necessary and to reopen quickly and therefore reduce potential loss of income.

Fiduciary Liability
Under ERISA, fiduciary responsibilities cover all employee benefit plans established or maintained by you. These include welfare benefit plans, and employee pension plans. If the person who has acquired the fiduciary responsibilities breaches the duties imposed by ERISA, (s)he will be held personally liable. Fiduciary Liability coverage is available through specialty insurance carriers.

Glass Coverage
Glass is not an excluded type of property on the All Risk property insurance form, but coverage is limited and restricted. Glass coverage will be required to provide coverage for both breakage and damage from chemicals applied to glass either accidentally or maliciously. In addition, coverage is provided for debris removal, the expense of boarding up openings or installing temporary plates, repair or replacement of frames encasing the damaged glass and expenses to remove obstructions in effecting the repair or replacement of damaged glass.

Installation Floater
The purpose of an installation floater is to insure the exposure of direct property loss involving equipment and materials to be put in place before the work is completed and accepted. The Installation Floater will also provide protection for equipment and materials temporarily stored (away from the your premises) and while in transit.

Kidnap & Ransom Insurance
This policy provides negotiation, payment and delivery of ransom or extortion demands in the event your employee or family member is kidnapped or held for ransom, or if your employees or property are threatened with harm.

Leased or Rented Equipment
A lease or rental agreement for contractor's equipment may hold you responsible for any damage to the equipment. Even in the absence of a lease or rental agreement, it is conceivable that you could be held liable for damage to the equipment. A general liability policy would, in most situations, not provide coverage for liability resulting from loss or damage to leased or rented equipment. Contractors with this exposure should consider this coverage.

Leasehold Interest Coverage
The leasehold interest coverage form covers the financial loss to a lessee which results from the termination of a favorable lease agreement following a direct damage loss to the leased premises.

Loss of Income - Contractors Equipment
An equipment floater usually contains a loss of use exclusion.If a piece of construction equipment is damaged or destroyed and this equipment cannot be immediately repaired or replaced and a temporary substitute is not immediately available, you might suffer a loss of income due to the inability to fulfill contractual obligations or solicit new work. This coverage may be written in conjunction with an equipment floater.

Owners or Contractors Protective Liability
This coverage provides protection for claims of bodily injury or property damage arising out of the operations performed by independent contractors on your behalf.

Standard general liability policies usually include the Pollution Exclusion endorsement. This exclusion creates a critical "pollution gap". Not just remediation or environmental contractors have this exposure - virtually every contractor, merely performing traditional construction activities, may face a pollution mishap, as well as general construction contractors who face pollution liability that is imposed upon them from subcontracted operations. Contractors Pollution Liability coverage is available for third-party bodily injury and property damage resulting from pollution conditions. Currently this coverage is available for as low a premium as $5,000.

Rental Cost Reimbursement
If a piece of construction equipment is damaged or destroyed, you may have to rent a temporary replacement until repairs can be made or new equipment can be acquired. If this exposure exists, an endorsement can be added to an equipment floater which will pay the additional expenses involved with renting equipment on a temporary basis.

Stop Gap
If you have operations in a monopolistic state (Nevada, Washington, West Virginia, North Dakota, Ohio, Wyoming), you must purchase workers compensation insurance from that state. However, monopolistic state funds do not offer employer's liability insurance. To fill this gap, the stop gap endorsement can be added to a workers compensation policy or to your general liability policy. (Employer's Liability exposure may arise where a claim related to an injury by an employee is not covered under workers' compensation law. In such a case, a common law or maritime suit might be brought. This type of suit is not covered by workers compensation insurance and is also excluded under general liability insurance. This coverage is provided under the workers' compensation policy in the State of California.)

Umbrella Liability
The primary function of an umbrella policy is to provide coverage for catastrophic losses. The umbrella policy provides high additional limits of liability above those purchased in primary liability policies. Usually umbrellas supply additional limits of liability over your general liability, automobile liability and employers liability policies.

Underinsured Motorist Coverage
In an auto accident where there is an injury caused by another person, the other person's Bodily Injury Liability insurance should respond to the loss. If, however, the person or organization that is responsible for the loss has insurance at limits which are not adequate to pay for the loss, the underinsured motorist coverage will cover the unpaid part of your expenses.

Unnamed Storage Locations
A contractor might rent a storage location, such as a mini-warehouse, to store various personal property items. To eliminate the necessary requirement of reporting each such storage location to the insurer, a miscellaneous unnamed location endorsement can be purchased. This endorsement gives the contractor blanket coverage for various storage locations.

Valuable Papers
Damage to valuable papers and records (e.g. maps, blueprints, books, deeds, mortgages etc.) is covered under the building and contents policy. However, this coverage is limited to the cost of the blank material for reproducing the records and the cost of the labor to transcribe or copy the records when duplicates exist. The Valuable Papers coverage covers the costs of recreating or reconstructing valuable papers. Storing duplicates of valuable papers in a safe deposit box or off-site location can virtually eliminate this exposure and therefore the need for this coverage.

Waiver of Collision Deductible
This endorsement is available under a Business Auto policy and allows that the collision deductible will not apply if you are hit by an uninsured motorist.

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