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Pollution Exposures to Consider for your Business

Pollution and environmental conditions are growing exposures for many businesses, exposures that are not covered under standard insurance policies. Due to the unknown nature of many environmental conditions, a pollution claim can arise at any time, for nearly any type of company, and the cost could prove devastating.

Luckily, pollution insurance is available as a separate policy to protect companies from the risk of environmental conditions and cover the many potential costs of those exposures.

There are countless possible pollutants, environmental conditions and contaminants in any building or property, and more could be discovered at any time. Many claims that insurance companies classify as pollution-related are ones that you may think would be covered under your commercial general liability (CGL) policy. Due to the sweeping pollution exclusion on these standard policies, you may find yourself surprised when a claim is classified as pollution and not covered.

The following are just a sampling of possible pollution exposures that may affect your business:

  • Toxic mold, fungus or other bacterial contamination
  • Silt runoff from construction sites into public water sources
  • Certain green construction techniques that can cause unforeseen pollutants
  • Asbestos
  •  Lead-based paint
  • Any contaminants or chemicals that could be released into the air or public water supply
  • Aboveground or underground storage tanks
  • Improper waste disposal

Currently, there are several types of pollution insurance coverage available, and most policies are customizable to fit you company’s unique risks and exposures. They often offer ancillary coverage options too, such as contamination during the transportation of goods.

Pollution is an unpredictable, costly exposure that your business needs to consider as part of its risk management program. While a lot of pollution-related incidents can be prevented, there is always the possibility for an unexpected spill, contamination or environmental condition to occur or surface. That is why pollution insurance is absolutely vital to protect your company. Call the Maguire Agency to learn more about pollution coverage available for your business.




The Cost of Doing Business with an Uninsured Contractor

Following is a document you can use when competing with an uninsured contractor.

Many businesses and individuals use independent contractors. While the owner is usually not liable for the actions of that independent contractor, third parties can and do make claims or sue the owner based on the actions of the independent contractor. Whether such a claim has merit, doesn’t keep the owner from being sued.

Working with an uninsured contractor is very dangerous and can be extremely costly. As a general contractor or project owner you are opening yourself up to all the liabilities of the uninsured contractor performing your work. Those liabilities include:

3rd party Liability – There are many liabilities assumed by a contractor when they are working on your property. As soon as they set foot on your property they have a responsibility to work safely and protect the public. If they are negligent in a duty and harm the public in any way you as the general contractor or project owner will be named in a lawsuit. Often the homeowners policy will not protect you in a lawsuit involving an uninsured subcontractor.

1st party Property – You are entrusting your house to the contractor, it is in their care, custody, and control. Your homeowners liability policy will not respond to a loss, whether it is an act of god or a negligent act of your contractor. You should make certain that the contractor has proper coverage for your house. It should be more that a transportation policy and more than a legal liability policy. It needs to offer care, custody, and control coverage

Workers Compensation – Any injury that occurs to an employee in the course of employment is considered a workers compensation injury. A contractor who has employees working without workers compensation is putting everyone involved in the project at risk. The general contractor, project owner or the homeowner can be held responsible for injuries to subcontractors employees.

When dealing with contractors it is important to make certain that they are properly insured. Before signing a contract you should ask for a certificate of insurance. A certificate of insurance outlines the coverage’s afforded by the contractor’s insurance policies. Once you have a copy of the certificate have it reviewed by an attorney or your local insurance agent.

Following is a real life example of the cost of doing business with an uninsured contractor:

Mr. and Mrs. Homeowner hire Bob over at Slamitup Contractors to move their home. Bob appears semi-professional, has done a lot of work in the neighborhood, and is quite a bit less expensive than other Contractors. Bob is a sole proprietor, and therefore is not required to have Workman’s Compensation insurance by law. Bob asks Mr. & Mrs. Homeowner to acquire any necessary permits and they do so without any questions.

Slamitup Contractors show up the first day with a crew of 3 and begin work. One of the crew slips off a ladder and falls breaking his hip. It turns out the injury is quite serious and the worker may never walk properly again. Since Slamitup Contractors was not insured for work related injuries for anyone except Bob, the worker and his family sue everyone in sight including Mr. & Mrs. Homeowner. Here’s where it gets scary.

Mr. & Mrs. Homeowner had not updated their insurance policy in years, and were grossly under insured. It turns out that the cost of the workers injury, therapy, lost wages, and pain and suffering will run 3 times over the limit of the insurance that the homeowner had. But why not sue the Contractor? They will, but he is uninsured, and has no tangible assets to speak of except that station wagon with the fake wood on the side. After all, he was a very small Contractor who was paying all his workers cash to keep his price low.

Well, the Homeowners insurance Company paid out the limit of the policy but informs Mr. & Mrs. Homeowner they are on their own for the rest. Needless to say, the litigation goes on for years and the expenses tap out Mr. & Mrs. Homeowners savings, retirement fund, and they may even loose their home and property if the lawyers have anything to say about it.

The moral of the story? Even though Bob at Slamitup was a good guy and never intended for something like this to happen, it is up to you as a homeowner to protect yourself. The City can’t do it, The State can’t do it – only you can do it. Make sure your Contractor has Liability AND Workman’s Compensation insurance as a minimum before they take one step on your property.

Require that you receive a certificate of insurance listing you as the certificate holder before you sign anything, and go over it with your insurance agent if you don’t understand it. If your Contractor is a sole proprietor, ask to see insurance certificates for every other person who works at your home. Don’t let low price blind you into taking a huge risk. Workman’s Compensation is a very large chunk of a legitimate Contractors overhead because very expensive injuries occur on job sites every day.

Although I am sure it is true that many uninsured Contractors complete many jobs every day without incident, do you feel lucky? Don’t take the chance; make sure your Contractor is properly insured.




EPA Rule Rolls Out More Stringent Safe-Lead Work Practices

In 2008, the U.S. Environmental Protection Agency (EPA) released stricter regulations for those performing work on buildings with lead-based paint. All parts of the final rule officially went into effect April 22, 2010.

The rule, called the Renovation, Repair and Painting Program, was developed to prevent lead poisoning among employees, supervisors and building inhabitants.

Those affected by the regulations are paid renovators working in pre-1978 housing and child-occupied facilities. This includes:

  • Renovation contractors
  • Maintenance workers in multi-family housing
  • Painters and other specialty trades

While the EPA has been slowly rolling out this program since its inception in 2008, the final step in implementation requires that all renovations in pre-1978 housing and child-occupied facilities be completed by a certified renovation firm that uses workers with accredited training and that follows all work practices of the final rule.

To ensure compliance with EPA regulations, contractors, property managers and maintenance personnel should consult this handbook: www.epa.gov/lead/pubs/sbcomplianceguide.pdf.




FMCSA/Department of Transportation Regulations

Comprehensive Safety Analysis 2010 (CSA 2010) is a new initiative by the Federal Motor Carrier Safety Administration (FMCSA) to improve motor carrier and driver safety. CSA 2010 will change the way FMCSA addresses safety performance and safety ratings by improving the efficiency and effectiveness of FMCSA’s enforcement and compliance program.

Maguire Agency wants to make sure you are aware of the new initiative – use this guide to understand what CSA 2010 is, when it will be implemented, how it works and what steps you should take to prepare.

What is CSA 2010?

Ultimately, the goal of CSA 2010 is to reduce crashes involving commercial motor vehicles (CMVs) throughout the country using a proactive prevention approach. FMCSA, in cooperation with state governments, will do this by reaching out to a larger number of carriers earlier and more frequently to address safety problems before dangerous CMVs – or drivers – get on the road.

Under CSA 2010, the FMCSA will:

  • Directly monitor the safety and performance of individual drivers, including their records across multiple employers
  • Hold both motor carriers and drivers responsible for safety and performance
  • Improve safety investigations and require intervention and corrective action as necessary
  • Make more complete safety performance assessments available to the public

When will CSA 2010 be fully implemented?

A CSA 2010 field test has been in operation since February 2008 and will run until mid-2010. Both qualitative and quantitative data will be collected, including feedback and input on the program to refine the model. FMCSA will continue to make motor carriers aware of the changes through the end of 2010. FMCSA will officially implement CSA 2010 in July 2010.

How does CSA 2010 work?

Measurement: Safety Measurement System (SMS) will replace SafeStat. Each month, SMS measures and analyses roadside violations for the previous 2 years to calculate a score in seven different Behavioral Analysis and Safety Improvement Categories (BASICs) – Unsafe Driving; Fatigued Driving (hours of service); Driver Fitness; Controlled Substances and Alcohol; Vehicle Maintenance; Cargo-related and Crash Indicator. Carrier scores are ranked relative to each other to determine problem entities.

Evaluation: A more thorough and detailed safety evaluation process allows FMCSA to efficiently and effectively address carriers with poor SMS scores. All safety based inspection violations and on-road performance will be used to evaluate performance and determine a carrier’s safety fitness rating. Violations are weighted based on when they occurred and their relationship to crash risk.

Intervention: FMCSA will reach out to carriers early on by issuing a warning letter for those with a deficient BASICs that outlines consequences and gives instructions for addressing the problem. Carriers will have access to their BASICs scores so they can monitor their own progress and challenge the accuracy if necessary. Carriers with deficient BASICs will be the subject of targeted roadside inspections to ensure corrective action is being taken.

What should I do to prepare for CSA 2010?

  • Update your records (MCS – 150) and check your inspection and crash reports (http://ai.fmcsa.dot.gov)
  • Visit the CSA 2010 website: http://csa2010.fmcsa.dot.gov to stay up to date on CSA 2010 news and information
  • Ensure compliance by addressing safety problems before evaluation or intervention
  • Educate your employees on how their driving affects their personal performance rating as well as the carrier’s safety assessment

Source: Comprehensive Safety Analysis Web site – http://csa2010.fmcsa.dot.gov