The new year brings a reminder that owners need to be careful about changes to their contractors’ and designers’ insurance policies. Many of the most important terms of an insurance policy are in “endorsements” added to the policy. For example, a policy may include an endorsement excluding claims between insured parties (say, a claim by an owner against its contractor), which defeats the purpose of adding the owner as an additional insured. Or an endorsement may exclude residential construction or injuries suffered by a contractor’s employee. There are other endorsements that limit or prevent coverage, and insurance companies regularly change their policies by issuing revised or new endorsements. For example, in 2013 the ISO (a company that writes common endorsement forms) issued new and revised additional insured endorsements for general liability policies. Owners shouldn’t assume that the endorsements they reviewed for their last project are the same as those in the contractor’s or designer’s current policy.
With all this in mind, owners should review their contractors’ and designers’ policies (including all endorsements) before the work starts, so that they’re getting the coverage they intend.