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Professional Liability Insurance

Professional Liability

Posted by on Sep 17, 2013

Protects professionals against liability for damages and cost of defense based upon his/her alleged or real professional errors and omissions or mistakes, e.g., architects, engineers, medical malpractice, attorneys. Errors & Omissions 1) Insurance covering the legal liability of professionals not usually involved with the care of the human body such as architects, engineers, accountants. 2) A type of insurance which will step in to take the place of insurance that has not been affected due to a mistake or forgetfulness on the part of the policyholder. Issued to risks such as mortgage concerns, professionals, semi-professionals or others engaged in the routine insurance of many properties. 3) A clause in certain policies whereby the insurer agrees to waive its defenses when an honest error has been committed, provided it is corrected when...

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Directors & Officers (D&O Insurance)

Directors & Officers Liability (D&O)

Posted by on Sep 17, 2013

Insurance that provides coverage for members of boards of directors against “wrongful acts,” which might include actual or alleged errors, omissions, misleading statements, and neglect or breach of duty on the part of the board of directors. A type of liability insurance covering directors and officers for claims made against them while serving on a board of directors and/or as an officer. D&O liability insurance can be written to cover the directors and officers of for-profit businesses, privately held firms, not-for-profit organizations, and educational institutions. In effect, the policies function as “management errors and omissions liability insurance,” covering claims resulting from managerial decisions that have adverse financial consequences. The policies contain “shrinking limits” provisions, meaning that defense costs—which are often a substantial part of a claim—reduce the policy’s limits. This approach contrasts with commercial general liability (CGL) policies, in which defense is covered in addition to policy limits. Other distinctive features of D&O policies are that they: (a) are written on a claims-made basis, (b) usually contain no explicit duty to defend the insured (when covering for-profit businesses), and (c) cover...

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Commercial General Liability (CGL)

Commercial General Liability (CGL)

Posted by on Sep 17, 2013

 Formerly known as Comprehensive General Liability otherwise known as business insurance, covers a wide range of Business Property and Liability Exposures.  In my opinion, every business requires Commercial General Liability insurance. Usually we will hear from new businesses when they have their first Contractual Requirement to provide an Insurance Certificate with Commercial General Liability insurance.  This type of policy is designed to protect your business as your main operating liability insurance.  We specialize in Commercial Insurance. For a quote on this coverage, do not hesitate to...

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Surety & Fidelity Bonds

Surety / Bonds / Fidelity

Posted by on Sep 17, 2013

A contract under which one party (the surety) guarantees the performance of certain obligations of a second party (the principal) to a third party (the obligee). For example, most construction contractors must provide the party for which they are performing operations with a bond guaranteeing that they will complete the project by the date specified in the construction contract in accordance with all plans and specifications. Bonds: A three-party contract in which one party, the surety, guarantees the performance or honesty of a second party, the principal (obligor), to the third party (obligee) to whom the performance or debt is...

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Recent Posts

5 Things to look out for before you sign your next Commercial Lease

1.   It is common for the leasing agent/landlord to request that they be added an Additional Insured to your Commercial General Liability policy. Where your company has caused a loss through your negligence, if your client had been added as an Additional Insured then they will be protected under your policy for their defense costs if named in a lawsuit.  The Insurance Company is fine with this, as they are paying our due to your negligence. However, it is important to watch for the term “Named Additional Insured or Additional Named Insured” . These are a very different terms in insurance. In essence, this request will allow the third party to be a named insured on your policy and could pick up coverage for their operations without the landlord having to pay any premium. 2. It is also common to see a request in a lease requiring 30 days notice of cancellation on your policy and this is also not too much of a concern.  In this clause, your insurance company becomes obligated to notify the interested party if your policy is being cancelled, either at your request or if there is a material change to your policy and the insurance company wants to get off risk.  If you request the cancellation and there is a party with this clause, you will have to wait the 30 days to cancel the policy. If the insurance company is cancelling the policy, then the standard notice applies to you (15 days by registered letter or 5 days if hand delivered) but it will be extended to the interested party for a full 30 days. It is very important to watch out for the following: 3. What limit of liability the lease is requiring that you carry.  If it is higher than you are now carrying presently, you will want to get a quote before you say “I do”. Once you have signed the contract you have no choice but to carry the limit they have requested or be in breach of your lease.  This can get very expensive.  It is normal to see a request for $2,000,000 but some leases are $5,000,000 – so if your...

Review your contracts with your Insurance Broker

Quite often when you are negotiating a contract for work with a prospective client, under the insurance (or indemnity) section of contract, you will find a requirement for a “Waiver of Subrogation”.  It is very important to discuss this with your broker as this clause may be deemed contrary to the insurance contract by your Insurer. When your client(s) request a waiver of subrogation they are asking your insurance company to pay losses for which they or their employee may be negligent. In essence, your client is requesting coverage for their operations under your insurance policy.  If an insurance company pays out defense costs  and damages where you have been named in a loss suit and it has been determined that you have done nothing wrong, then the insurance company should be able to recoup these payments from the negligent party and their Insurance Company.  To deny your insurance company the ability to do this could be very costly to your Insurer which in turn could be more costly to you. We, at Collis Insurance, believe that the best course of action is to have the waiver of Subrogation clause removed entirely before you sign the contract.  This is the simplest and most equitable solution for all parties concerned. In order to do business with your clients and protect them in the event that they are named in a lawsuit with you, your client can usually be added as an additional insured on your Commercial General Liability policy.  This is another common requirement seen on contracts.  The intention of the Additional Insured clause is to pay defense costs on behalf of your client if it is determined that it was your company’s[1] negligence that caused the loss and they were found to be an innocent party. [1] Your company means you and your employees – please refer to the definition of an insured in your policy wording for a complete description As Always “Collis” with all your business insurance needs! Andrea & Staff [1] Your company means you and your employees – please refer to the definition of an insured in the wording for a complete...

Not Required to Carry Workers Compensation? Consider purchasing Employers Liability Coverage

A few years ago (ok maybe a few more than a few)  Pati was working for a company who was not required to carry Workers Compensation and opted not to purchase it . One of her co workers went into the storage/mail room to get some supplies. The room was over crowded and there were several boxes stacked on the floor. She had to reach a high shelf to get the supplies she required and although she used the step ladder, with the boxes on the floor she could not set it up properly. While on the ladder she leaned too far over and fell. She shattered her elbow on the cement floor. After many surgeries she was off work for more than a year and when she did finally return to work it was on very limited duties. Her arm has never been the same since.   Due to the employers negligence, they were legally obligated to pay compensatory damages to Pati’s co-worker for her injuries. Fortunately, the employer had purchased Employers Liability as an extension to their Commercial General Liability insurance so they put a claim in and the insurance company paid her damages. Under the Commercial General Liability policy there are limitations, conditions and exclusions relating to Employee injuries in the workplace. There is a specific exclusion relating to Employees covered by Workers Compensation. However, in the event  cover or benefits have been denied by any Canadian Workers’ Compensation Authority, the standard wording can offer coverage under an   extension called Contingent Employers Liability.  This is only available when workers compensation is purchased. Some type of industries are not required to carry Workers Compensation and can choose to purchase it or not, while other industries are required to by law in Canada.  Please visit your local Worker Compensation website to determine if you are exempt from carrying Workers Compensation or not.  If you are one of the industries not required to carry this and choose not to purchase it, you should consider carrying Employers Liability. This coverage will protect you as an employer if an employee is injured in the work place due to your negligence.  This extension can usually be added to a Commercial General Liability policy for a small additional premium. While the industries that...