Proposed Division 1-99 Provision to become effective in the 2000 Standard Specifications for Road, Bridge and Municipal Construction
1-07.18 Public Liability and Property Damage Insurance (APWA only)
General Requirements
The Contractor shall obtain and keep in force during the term of the contract and until 30 days after the physical completion date, unless otherwise indicated below, the following insurance with insurance companies or through sources approved by the State Insurance Commissioner pursuant to Title 48 RCW.
The insurance provided must be with an insurance company with a rating of A-: VII or higher in the A.M. Best's Key Rating Guide, which is licensed to do business in the state of Washington (or issued as a surplus line by a Washington Surplus lines broker). The Contracting Agency reserves the right to approve the security of the insurance provided, the company, terms and coverage, and the Certificate of Insurance.
If any policy is written on a claims made form, the retroactive date shall be prior to or coincident with the effective date of this contract. The policy shall state that coverage is claims made, and state the retroactive date. Claims made from coverage shall be maintained by the Contractor for a minimum of three years following the expiration or earlier termination of this contract, and the Contractor shall annually provide the Contracting Agency with proof of renewal. If renewal of the claims made form of coverage becomes unavailable, or economically prohibitive, the Contractor shall purchase an extended reporting period ("tail") or execute another form of guarantee acceptable to the Contracting Agency to assure financial responsibility for liability for services performed.
The policies of insurance shall contain a "cross liability" endorsement substantially as follows:
The inclusion of more than one insured under this policy shall not affect the rights of any insured as respects any claim, suit, or judgment made or brought by or for any other insured or by or for any employee of any other insured. This policy shall protect each insured in the same manner as though a separate policy had been issued to each, except that nothing herein shall operate to increase the company's liability beyond the amount or amounts for which the company would have been liable had only one insured been named.
The policies of insurance for general, automobile, and pollution policies shall be specifically endorsed to name the Contracting Agency and its officers, elected officials, employees, agents and volunteers, and any other entity specifically required by the Contract Provisions, as additional insured(s).
Federal funds may not participate in cost of providing insurance for the contracting agency. In order for this provision to be used on Federal-aid contacts, it must be shown that there is NO ADDITIONAL COST to the project for this coverage, or the costs must be made non-participating.
In addition, Contractor's insurance shall be primary as respects the Contracting Agency, and any other insurance maintained by the Contracting Agency shall be excess and not contributing insurance with the Contractor's insurance.
The Contracting Agency shall be given at least 45 days prior written notice of any cancellation, reduction in coverage, or other material change in any insurance policy.
Insurance shall provide coverage to the Contractor, all subcontractors, and the Contracting Agency. The coverage shall protect against claims for personal injuries, including accidental death, as well as claims for property damages which may arise from any act or omission of the Contractor or the subcontractor, or by anyone directly or indirectly employed by either of them.
Contractor hereby assumes all risk of damage to its property, or injury to its officers, directors, agents, contractors, or invitees, in or about the Property from any cause, and hereby waives all claims against the Contracting Agency. The Contractor further waives, with respect to the Contracting Agency only, its immunity under RCW Title 51, Industrial Insurance.
Upon request, the Contractor shall forward to the Contracting Agency the original policy, or endorsement obtained, to a Contractor's policy currently in force.
The Contractor shall not begin work under the contract until the required insurance has been obtained and approved by the Contracting Agency.
Failure on the part of the Contractor to maintain the insurance as required shall constitute a material breach of contract upon which the Contracting Agency may, after giving five working days notice to the Contractor to correct the breach, immediately terminate the contract or, at its discretion, procure or renew such insurance and pay any and all premiums in connection therewith, with any sums so expended to be repaid to the Contracting Agency on demand, or at the sole discretion of the Contracting Agency, offset against funds due the Contractor from the Contracting Agency.
All costs for insurance shall be incidental to and included in the unit contract prices of the contract and no additional payment will be made.
Coverages and Limits
The insurance shall provide the minimum coverages and limits set forth below. Providing coverage in these stated minimum limits shall not be construed to relieve the Contractor from liability in excess of such limits. All deductibles must be disclosed and are subject to approval by the Contracting Agency. The cost of any claim payments falling within the deductible shall be the responsibility of the Contractor.
1. A policy of Commercial General Liability Insurance, written on an insurance industry standard occurrence form: (CG 00 01) or equivalent, including all the usual coverage known as:
- Per project aggregate endorsement (CG2503)
- Premises/Operations Liability
- Products/Completed Operations - for a period of one year following final acceptance of the work.
- Personal/Advertising Injury
- Contractual Liability
- Independent Contractors Liability
- Stop Gap or Employers Contingent Liability
- Explosion, Collapse, or Underground (XCU), (as applicable)*
- Liquor Liability/Host Liquor Liability (as applicable)*
- Fire Damage Legal
- Blasting (as applicable)*
*These coverage are only required when the Contractor's work under this agreement includes exposures to which these specified coverage respond.
If the contract requires working over water, the following additional coverages are required:
a. Watercraft, owned and non-owned
b. U.S. Harborworkers'/Longshoremen and Jones Act
If any structures are involved in the contract, the Contractor shall provide property insurance under an "All Risk Builder's Risk" form in an amount equal to the value of the structure. The structure shall have All Risk Builders Risk Insurance inclusive of earthquake and flood subject to customary industry deductibles.
Other additional coverages that may be required will be listed in the Contract Provisions.
Such policy(ies) must provide the following minimum limits:
Bodily Injury and Property Damage -
$ 1,000,000 General Aggregate
$ 1,000,000 Products & Completed Operations Aggregate
$ 1,000,000 Personal & Advertising Injury
$ 1,000,000 Each Occurrence
$ 50,000 Fire Damage
Stop Gap Employers Liability
$ 1,000,000 Each Accident
$ 1,000,000 Disease - Policy Limit
$ 1,000,000 Disease - Each Employee
2. Commercial Automobile Liability: as specified by Insurance Services Office, form number CA 0001, Symbol 1 (any auto), with an MCS 90 endorsement and a CA 9948 endorsement attached if "pollutants" as defined in exclusion 11 of the commercial auto policy are to be transported. Such policy(ies) must provide the following minimum limit:
Bodily Injury and Property Damage -
$1,000,000 combined single limit
3. Excess or Umbrella Liability
$1 million per occurrence and aggregate
4. Pollution Liability: A policy providing coverage for claims involving remediation, disposal, or other handling of pollutants arising out of Contractor's operations for others; contractors site (owned); arising from the transportation of hazardous materials; or involving remediation, abatement, repair, maintenance or other work with lead-based paint or materials containing asbestos.
Such Pollution Liability policy shall provide the following minimum coverage for Bodily Injury and Property Damage:
$1,000,000 per occurrence
5. Professional Liability: Required if design services are a part of the work, to cover damages resulting from professional errors and omissions. Such policy must provide the following minimum coverage:
$1,000,000 per claim and annual aggregate.
6. A policy of Worker's Compensation, as required by the Industrial Insurance Laws of the State of Washington. As respects Workers' Compensation insurance in the state of Washington, Contractor shall secure its liability for industrial injury to its employees in accordance with the provisions of RCW Title 51. If Contractor is qualified as a self-insurer in accordance with RCW 51.14, Contractor shall so certify by letter signed by a corporate officer indicating that it is a qualified self insured, and setting forth the limits of any policy of excess insurance covering its employees.
Subcontractors
Contractor shall include all subcontractors as insureds under its policies or shall furnish separate evidence of insurance as stated above for each subcontractor. All coverage for subcontractors shall be subject to all the requirements stated herein and applicable to their profession.
Evidence of Insurance
When the Contractor delivers the executed contract for the work to the Contracting Agency it shall be accompanied by a Certificate(s) of Insurance and endorsements for each policy of insurance meeting the requirements set forth above. The certificate must conform to the following requirements:
a) An ACORD certificate Form 25-S, showing the insuring company, policy effective dates, limits of liability and the Schedule of Forms and Endorsements.
b) A copy of the endorsement naming Contracting Agency and any other entities required by the Special Provisions as Additional Insured(s), and stating that coverage is primary and non-contributory, showing the policy number, and signed by an authorized representative of the insurance company on Form CG2010 (ISO) or equivalent.
c) A copy of an endorsement stating that the coverage provided by this policy to the Contracting Agency or any other named insured shall not be canceled, reduced in coverage, or otherwise materially changed without providing at least forty-five (45) days prior written notice to the Contracting Agency.
d) The certificate(s) shall not contain the following or similar wording regarding cancellation notification to the Contracting Agency: "Failure to mail such notice shall impose no obligation or liability of any kind upon the company."
Self-Insurance
Should Contractor be self-insured for any liability coverage, a letter from the Corporate Risk Manager, or appropriate Finance Officer, is acceptable-stipulating if actuarially funded and fund limits; plus any excess declaration pages to meet the contract requirements. Further, this letter shall advise how Contractor would protect and defend the Contracting Agency as an Additional Insured in their Self-Insured layer, and include claims-handling directions in the event of a claim.