Insurance and Indemnity Provisions may Reduce the Cost of Construction Accidents
Jobsite accidents are personally and economically costly. While everything may be done to avoid accidents, they will never be eliminated entirely. The claims process and possible litigation is expensive even if the case is successfully defended. The company can protect itself by writing strong indemnity and insurance provisions into its contracts. There are several areas to keep in mind when drafting these provisions.
A.) Specifically review “boilerplate” insurance and indemnity provisions. Boilerplate, or contract provisions simply transferred automatically from contract to contract without modification, may have gaps or not be applicable to certain situations that may be relevant to a particular job site. Likewise, relying on another party to indemnify your company or name your company as an additional insured must be appropriately detailed or it may fail when it is needed most.
B.) Insurance policy renewals should be tracked diligently, through a docket system for reminding appropriate parties of the need for renewal.
C.) In a related item, keep documentation to confirm coverage is in place, particularly if relying on another party to have insurance. Certificates of Insurance can be inadequate or not detailed, so actual policy declarations should be reviewed.
D.) Finally, an insurance broker/contractor/attorney partnership can coordinate these issues to avoid expensive exposure.
