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22 Nov, 2019

A Bond is NOT Insurance

2019-11-22T09:23:13-06:00November 22nd, 2019|Bond Claims, Construction Contractor Advisor, Insurance coverage, Nebraska Construction Law|

There are fundamental differences between insurance and surety bonds and knowing the difference will help you avoid making mistakes, should claims arise.  This blog will discuss the differences between insurance and surety bonds. Insurance An insurance policy is a two party contract between an insurer and the insured.  The policy is intended to protect the insured.  The cost of insurance is calculated by the insurer based on how many claims [...]

23 May, 2019

Construction Litigation—Battles on Many Fronts

2019-05-21T08:19:55-05:00May 23rd, 2019|Construction Contractor Advisor, Construction Litigation, Insurance coverage|

When you are involved in construction litigation, you have battles on several fronts, including those against subcontractors, owners, insurers and the court.  Shoring up your defenses on each of these fronts is imperative, or you may lose the battle or, worse yet, the war. An opinion out of the Eleventh Circuit Court of Appeals (overseeing federal courts in Alabama, Florida and Georgia) Carithers v. Mid-Continent Casualty Company, illustrates the various [...]

9 May, 2019

So, You’ve Been Sued, Now What?  Tender–Quickly.

2019-05-06T10:21:04-05:00May 9th, 2019|Construction Contractor Advisor, Insurance coverage|

If you or your construction company have ever been sued, you know it can be a stressful time.  You have deadlines, you have subcontractors clamoring to get paid or defended, and it’s a generally awful situation.  But, keep your mind on the prize--to make sure you have insurance coverage that will provide a defense to these claims.  The most important step to ensure you have coverage is to tender your [...]

9 Apr, 2019

Are Defense Costs In Addition to Policy Limits?

2019-03-30T10:42:15-05:00April 9th, 2019|Construction Contractor Advisor, Insurance coverage|

I recently had a discussion with an insurer about whether defense costs were included within the policy limits of a client’s coverage or in addition to policy limits.  This was an important discussion because if costs of defense were included in the policy limits, my client was going to exceed those policy limits in a hurry.  How would this situation play out with your insurance? Fortunately, the majority of insurance [...]

1 Dec, 2015

Are Defense Costs In Addition to Policy Limits?

2018-04-23T23:55:09-05:00December 1st, 2015|Construction Contractor Advisor, Insurance coverage|

I recently had a discussion with an insurer about whether defense costs were included within the policy limits of a client’s coverage or in addition to policy limits.  This was an important discussion because if costs of defense were included in the policy limits, my client was going to exceed those policy limits in a hurry.  How would this situation play out with your insurance? Fortunately, the majority of insurance [...]

27 Jul, 2015

Insurance Policy Language Really Does Matter

2018-04-23T23:55:10-05:00July 27th, 2015|Construction Contractor Advisor, Insurance coverage|

The debate continues on whether a subcontractor’s faulty work constitutes property damage and an occurrence such that the insurer must cover the claim.  The most recent court to weigh in on this issue is the New Jersey appellate court (one step down from the New Jersey Supreme Court) in Cypress Point Condominium Association, Inc. v. Adria Towers, LLC. In this case, the condominium association sued the general contractor, who also [...]

29 Jun, 2015

Construction Contract Language and Insurance Coverage Must Be Consistent

2018-04-23T23:55:10-05:00June 29th, 2015|Construction Contractor Advisor, Insurance coverage|

How often do you review both the additional insured language in the contract and the insurance policy provided by a subcontractor?  My guess is, unless the project has gone off the rails, NEVER.  Well, perhaps you should to make absolutely sure the extent of the subcontractor’s insurance obligations and whether those obligations are being fulfilled. This point was recently addressed in a recent DRI article analyzing the Deepwater Horizon/BP lawsuit.  [...]

3 Feb, 2015

The Insurance Coverage Debate on Construction Defects Continues

2018-04-23T23:55:11-05:00February 3rd, 2015|Construction Contractor Advisor, Insurance coverage|

New Hampshire is the first court of 2015 to weigh in on construction defect coverage issues. The case, Cogswell Farm Condominium Association v. Tower Group, involved a typical situation. Lemery Building Company was hired to build 24 residential condominium units. After construction, the condominium association sued the builder asserting that the weather barrier, including the water/ice shield, flashing, siding, and vapor barrier, was defectively constructed and resulted in damage to [...]

23 Dec, 2014

Happy Holidays and My Gift to You

2018-04-23T23:55:12-05:00December 23rd, 2014|Construction Contractor Advisor, Insurance coverage|

I love this time of year.  Of course, work efficiency is down and that which does get done is hard fought, but I love the season of hope and joy. I hope that you and yours have a wonderful holiday season. I also wanted to get you something  I thought long and hard about what to get you. Reflecting on the year, I realized that insurance coverage was a popular [...]

8 Dec, 2014

That’s What I have Insurance For, Right?

2018-04-23T23:55:12-05:00December 8th, 2014|Construction Claims, Construction Contractor Advisor, Insurance coverage|

Construction Insurance Coverage Ah, the age old question, What does my insurance really cover?  A federal court in Georgia recently weighed in on this issue in Standard Contractors, Inc. v. National Trust Insurance Company, and ruled that a contractor’s commercial general liability insurer did not have to pay for damage caused by a subcontractor. Standard Contractors was hired to renovate the pool on an army base.  Standard hired [...]

10 Nov, 2014

Court Again Defines Extent of Contractor’s Insurance Coverage

2018-04-23T23:55:12-05:00November 10th, 2014|Construction Contractor Advisor, Insurance coverage|

Construction insurance coverage can be confusing and counsel may be necessary to review coverage decisions. The ever changing landscape of insurance coverage for contractors continues to be clarified in Texas. The Fifth Circuit Court of Appeals applied Texas law in Crownover v. Mid-Continent Casualty Company, concluding that contractors do have insurance coverage to cover claims that a project was not constructed in a good and workmanlike manner. In [...]

15 Sep, 2014

Nebraska Joins the Ranks—No CGL Coverage for Faulty Work

2018-04-23T23:55:13-05:00September 15th, 2014|Construction Claims, Construction Contractor Advisor, Insurance coverage|

The Nebraska Court of Appeals has ruled that a home builder that fails to adequately compact the soil does not have insurance coverage to repair damages to the home caused by the settling soil. In “insurance speak”, there was no occurrence to trigger coverage. In this case, Cizek Homes, Inc. v Columbia National Insurance Company, a home builder contracted with a buyer to build a house. A lot was selected and [...]

9 Sep, 2014

The “Your Work” Exclusion—Is there a Trend against Coverage?

2018-04-23T23:55:13-05:00September 9th, 2014|Construction Contractor Advisor, Insurance coverage|

Two more courts have weighed in on the “your work” exclusion in commercial general liability (CGL) policies, finding that contractors did not have coverage for work performed improperly. These cases highlight that whether you have coverage for poor workmanship will depend on the state’s law applied. It now appears that if you are in South Carolina or Massachusetts, you will not have coverage. The South Carolina case, Precision Walls, Inc. [...]

29 May, 2014

CGL Coverage in Nebraska

2018-04-23T23:55:14-05:00May 29th, 2014|Construction Contractor Advisor, Insurance coverage|

After last week’s blog about what is covered by a CGL policy, I received a number of questions about whether Nebraska courts would cover faulty workmanship. So, what is covered by a CGL policy in Nebraska? The latest Nebraska Supreme Court case on this issue, Auto-Owners Ins Co v Home Pride Companies Inc, in 2004, ruled that faulty workmanship is not covered under a CGL policy. But, the insurer was [...]

19 May, 2014

What Does CGL Insurance Cover Anyway?

2018-04-23T23:55:14-05:00May 19th, 2014|Construction Contractor Advisor, Insurance coverage|

The Texas courts continue to wrestle with the problem of what is covered by a CGL policy.Readers may recall that in September, 2012, I wrote a blog about a Texas case winding its way through the federal courts and then being shipped to the Texas Supreme Court for additional analysis. Well, earlier this year the Texas Supreme Court finally issued its opinion, finding that a CGL policy does cover faulty [...]

12 May, 2014

Additional Insured – Do You Really Have Coverage?

2018-04-23T23:55:14-05:00May 12th, 2014|Construction Contractor Advisor, Insurance coverage|

Additional Insured language is contained in nearly every construction contract. But how many of you are actually reviewing the additional insured endorsement? And, does it provide the coverage that you are required to provide? Nearly every construction contract requires that general contractors add owners as additional insureds and subcontractors must add the general contractor as an additional insured. Sometimes, the subcontractors must also list the owner as an additional insured. [...]

20 Mar, 2014

Additional Insured Endorsement – What Coverage Does it Provide?

2018-04-23T23:55:14-05:00March 20th, 2014|Construction Contractor Advisor, Insurance coverage|

The Fifth Circuit Court of Appeals recently ruled in Woodward, LLC v. Acceptance Indemnity Insurance Company, that a general contractor, named as an additional insured, did not have coverage for claims that a subcontractor performed faulty work. At issue was the language in the additional insured endorsement, which provided coverage for ongoing operations, not completed operations. The court held that the damages arose out of completed operations not the subcontractor’s [...]

28 Jan, 2014

Texas Contractors Win Big–CGL Covers Work Defects

2018-04-23T23:55:15-05:00January 28th, 2014|Construction Contractor Advisor, Insurance coverage|

The Texas Supreme Court recently ruled that a general contractor has coverage for construction defects under its Commercial General Liability (CGL) insurance where the contract required the work to be performed in a good and workmanlike manner. While this may sound like no big deal, this was the most anticipated opinion of the year. As is often the case in litigation over insurance policies, the debate over coverage delves deeply into [...]

28 May, 2013

Being Named as an Additional Insured Is Not Enough

2018-04-23T23:55:18-05:00May 28th, 2013|Construction Contractor Advisor, Insurance coverage|

Now a days, nearly every construction subcontract requires upstream contractors be named as an additional insured on the subcontractor’s general liability insurance.  But, simply being named as an additional insured in a certificate of insurance is not enough.  General contractors need to make sure that their subcontractors have obtained the proper additional insured endorsements. Why isn't a certificate of insurance enough? A certificate of insurance, which is a document issued by or [...]

7 Mar, 2013

Being Named as an Additional Insurance Does Not Mean You Have Coverage for the Claim.

2018-04-23T23:55:19-05:00March 7th, 2013|Construction Contractor Advisor, Insurance coverage|

A Commercial General Liability (CGL) insurer does not typically have liability for property damage to the structure being constructed. Instead, coverage usually only applies to other property damaged by the work. In the recent lawsuit Lagestee-Mulder, Inc. v. Consolidated Insurance Co., the contractor found out the hard way that he had no coverage when the owner sued for construction defects. In this case, the general contractor was named as an [...]

29 Nov, 2012

So, you’re an additional insured. Now what?

2012-11-29T13:52:00-06:00November 29th, 2012|Insurance coverage|

Construction contracts often require subcontractors and sub-subcontractors to name upstream contractors as additional insureds on their policy. I often wonder whether the upstream contractor ever reviews its subcontractors’ insurance policies to find out the specifics on when claims must be made, the limits applicable to the project, and the exclusions. If you are an upstream contractor and you are named as an additional insured on your subcontractor's insurance, here are [...]

20 Nov, 2012

Wrap-Ups and Controlled Insurance Programs

2012-11-20T08:00:39-06:00November 20th, 2012|Insurance coverage|

You may be seeing a rise in owners and contractors demanding the use of wrap-up insurance programs on projects. While wrap-ups may allow for some cost savings, you still need to maintain your base coverage and make sure completed operations coverage is in place. What are Wrap-Ups? Wrap-ups are blanket insurance programs that cover an entire project. They generally come in two forms: owner-controlled or contractor-controlled. Wrap-ups historically combine liability [...]

25 Sep, 2012

Does your Insurance cover you for Indemnity?

2012-09-25T13:29:11-05:00September 25th, 2012|Insurance coverage|

Chances are that you have an indemnity clause in your contract.  And, if you are forced to indemnify another party, is that payment covered by insurance?  The not so clear answer is maybe and it will depend on your insurance policy, the contract and how your state's courts interprets both.  Regardless, it’s good to know the basics, even if the process makes your head hurt. What are your indemnity obligations? Generally speaking, under [...]

20 Sep, 2012

The Continuing Evolution of CGL Coverage for Contractors

2012-09-20T08:00:06-05:00September 20th, 2012|Insurance coverage|

The recent Texas construction case Ewing Construction v. Amerisure Insurance Company has been getting a lot of headlines lately. The Fifth Circuit Court of Appeals, which oversees federal courts in Texas, Mississippi, and Louisiana, recently withdrew its opinion in which it found that contractors, who agreed by contract to perform their work in a good and workmanlike manner, did not have coverage under their CGL insurance policy if it was [...]

28 Aug, 2012

What Does it Mean to be an Additional Insured of a Subcontractor?

2012-08-28T08:30:14-05:00August 28th, 2012|Insurance coverage|

Most construction contracts require that the subcontractor list the general contractor as an additional insured. But, from a practical and coverage standpoint, what does that mean? When a general contractor is listed as an additional insured, the subcontractors insurance carrier owes the general contractor a duty of indemnity and defense for any vicarious liability the general contractor may incur as a result of the subcontractor’s negligence. The subcontractor’s carrier may [...]

23 Aug, 2012

Does your CGL Insurance Cover Construction Defects?

2012-08-23T17:03:26-05:00August 23rd, 2012|Insurance coverage|

The question of whether a construction defect is covered by commercial general liability (“CGL”) insurance is a hotly contested issue throughout the United States. A recent construction law article identifies four states that have passed statutes to require construction defect coverage under CGL insurance policies. The article may be found here. The states that have passed statutes are Colorado, Hawaii, Arkansas and South Carolina. The Colorado statute creates a presumption [...]

5 Jul, 2012

Truth is Stranger than Fiction, Even with Insurance

2012-07-05T10:48:28-05:00July 5th, 2012|Insurance coverage|

I have enjoyed the new show Longmire on A&E. One episode the other night involved a crooked social service worker who was taking kickbacks for removing kids from Native American families and placing them with Caucasian adoptive parents. I then read an article in Engineering News Record about a construction company engaged to build a county’s privately developed and operated juvenile justice facilities that was bribing judges to incarcerate more [...]

5 Apr, 2012

Are You Adequately Covered By Insurance on the Construction Site?

2012-04-05T12:51:20-05:00April 5th, 2012|Insurance coverage|

This is the first in a series of posts authored by Anne Marie O’Brien, a partner in LDM’s litigation department. Ms. O’Brien has agreed to draw upon her experiences with insurance coverage disputes to provide information about growing insurance issues for construction companies.  This article addresses your risks associated with Polution Exposure and whether you have coverage for this type of problem. By Anne Marie O'Brien All builders have a [...]