Hey, I know these are tough times and insurance costs associated with being a

contractor are a burden. What never ceases to amaze me is the number and variety claims we see in a year’s time. I thought I’d share some of these losses with you. I want you to see that regardless of the quality of your work and the fact that you’ve never had a claim, you should never skimp on insurance!

The Indemnification Claim: In this situation, a hardwood floor contractor worked for a general. His work was impeccable. The subcontractor was named in a cross complaint from the general contractor’s insurance policy. The home that was built had some water intrusion problems and the homeowner sued the general

contractor who sued the subcontractor. The subcontractor, having indemnified (or taken responsibility for) the general, turned the claim over to his insurance company. Many thousands of dollars later the claim was settled.

The Slip and Fall Claim: This was really bad. A new stairway was being built for a second floor addition. The contractors and their employees were using a makeshift ladder to access work on the second level. Over the weekend the homeowner used the makeshift ladder to inspect the progress and fell while descending the ladder. The homeowner was severely injured, and as result, every contractor on the job was sued.

The Subrogation Claim: I will not mention the brand of faucet, but three years

after the job was completed, a bushing in the kitchen faucet split and water ran under the sink, unnoticed, for hours. The homeowner made a claim on her home insurance policy and the damages (over 250K) were taken care of by the home insurance

carrier. This claim should have ended at this point, but the home insurance carrier saw that there was a permit pulled to remodel the kitchen three years prior. They turned their loss over to a law firm who subrogated the claim to both the general

contractor and the plumbing contractor who did the kitchen remodel.

I hope you never have a claim, but if you do, are you sure you have the best possible policy ?

A message from the desk of Mike Wise: