Liability

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Liability Insurance

Background

Coverage that protects the insured from the risks of liabilities imposed by lawsuits and similar claims. Liability insurance is designed to offer specific protection against third party insurance claims, i.e., payment is not typically made to the insured, but rather to someone suffering loss who is not a party to the insurance contract.

In general, damage caused intentionally as well as contractual liability are not covered under liability insurance policies.

When a claim is made, the insurance carrier has the duty (and right) to defend the insured. The legal costs of a defense normally do not affect policy limits unless the policy expressly states otherwise; this default rule is beneficial because defense costs tend to soar when cases go to trial.

Exclusions

Liability protection is typically limited or excluded for the following perils:

  • Pollution- may be supplemented through an additional policy
  • Mold- may be supplemented through an additional policy
  • The specialized liability policies described below provide coverage that is otherwise excluded or limited

Specialized Liability Protection

Cyber Liability– one of the hottest topics today in insurance, this is very important protection for every business with internet connection and includes protection for:

  • Data security breach- someone stealing customer or employee private information off your network
  • ID recovery protection- theft of your private information
  • Computer hackers and viruses
  • Fraudulent electronic funds transfer

Employment Practices Liability (EPL)– protection against claims of discrimination, wrongful termination, and sexual harassment. We strongly recommend a separate EPL policy as standard liability policies specifically exclude it. EPL claims are made at an increasing rate of frequency and settlements are substantial.

Director’s and Officer’s (Malpractice) Liability– protection for the actions or inactions of an officer for suits brought against the business, whether public or private, or its individual leaders

Professional liability– protection when the “products” of your organization include any professional services, i.e. designs, against which claims can be made. In these cases, you should consider separate professional liability such as “Design Errors and Omissions” or other such versions of professional liability.

Employer’s Hired & Non-Owned Auto Liability– protection for an employer’s vicarious liability from an employee or subcontractor using their own vehicle for the employer’s business operation. An employer is responsible for the actions of employees when performed within the course of their employment. Although the employee may carry personal insurance to cover his or her own liability, such insurance may be inadequate to cover all damages and a claimant may pursue the employer and the employer’s insurance.

Excess (Catastrophe) Liability– general liability insurance protection will cover for certain lawsuits, up to the limit described on the policy, but you are responsible for any expenses or judgments in excess of that limit. In today’s litigious society, excess liability coverage with limits of coverage above that of underlying general liability, is a responsible, cost-effective way to protect your business against catastrophe.

Employee Benefit Liability & Fiduciary Liability– protection for wrongful administration of employee benefit plans

Contractor-related liability

  • Builder’s risk
  • Voluntary property damage
  • Installation floater

Other liability

  • Off-premises Liability
  • Owned Trailer Liability

Important Topics- Liability Insurance

Ask us about the following topics pertaining to Liability Insurance:

  • Uninsured Subcontractors- if you do not collect valid certificates of insurance (proof) from your subcontractors, you could be held responsible for their liability and/or injuries to their employees. Under the Pennsylvania Workers Misclassification Act, this could be considered a criminal offense. Always ask for a certificate of insurance for liability and workers’ compensation.
  • Authorized Drivers
  • Sales & Payroll review
  • Contractor-specific:
    • Written contracts
    • Independency of subcontractors
    • Quality of workmanship

Our programs

Our services

  • Excess and Umbrella guidance
  • Hazard review for products and completed operations
  • Liability classifications analysis
  • Administration of certificates of insurance
  • Executive/Directors protection