Part 2- How to Hire a Commercial Roofing Contractor

We're back!!! Here is Part 2 of How to Hire a Commercial Flat Roofing Contractor. In this segment you'll learn all about Roofing contractor's insurance requirements and the major differences between various types of liability insurance.

Insurance

Always ask the roofing contractor for proof of insurance and insist on seeing copies of insurance certificates that verify workers' compensation and general liability coverage before they ever set foot on your property! Then, if you elect to hire the contractor, ensure that you have a policy endorsement naming your company or entity as additionally insured. Make sure the coverage is in effect through the duration of your job. Get a list of all subcontractors who may be on the project and insist on endorsements from those companies as well.

If a contractor is not properly insured the owner may be liable for accidents that occur on the property. Many building owners and managers have been dragged into expensive proceedings involving uninsured contractors. Don’t become one of them! (or you'll look like this stressed out cat!)

A good rule of thumb for flat roofing contractors is to require at least $5,000,000 in general Liability coverage. Be aware that there are significant differences in liability policies. The best contractors have liability policies that includes “occurrence” coverage not merely “claims made” coverage.


If your contractor is not carrying the correct type of liability insurance you could be stuck with property damages or an injury claim that could cost you tens of thousands of dollars. Many contractors look to save money by purchasing the cheapest type of liability insurance possible, the “Claims Made” policy. Construction “Claims Made” policies became popular in the mid 1980’s and have been around ever since. The promise of these policies is lower costs to the contractor. However the Claims Made policy for contractors can cost their customers a lot of money in the long run. The preferred liability insurance your contractor should carry is an “Occurrence” Policy.

Why is an Occurrence policy better than a Claims Made policy?

Under an Occurrence policy the coverage is triggered when an “occurrence” happens during the time the contractor is working on your property. The key to an Occurrence policy lies within the continued coverage even after the policy has expired. The insurance company will cover a claim even if the claim is not filed until years after the project is completed. This rule applies even if the contractor’s policy has long expired. An example would be if an individual is injured on the job site, other than someone covered by worker's compensation, and the extent of the injury was not realize for several years. The Occurrence policy would cover the claim even if the claim was filed 10 years after the event.

A Claims Made policy on the other hand has a different coverage trigger. A claim must be brought during the time in which the Claims Made policy is in force. This simply means that once the contractors policy expires damages and/or injuries that have occurred during the construction period but have not been filed for will not be covered.

Things to Remember

The Claims Made policy ceases to provide coverage at the point of cancellation. An Extending Reporting Period only extends coverage an additional 60 days after the Claims Made policy expires. A Supplemental Extended Reporting Period endorsement provides additional coverage only if it is requested within the allowed time frame. The occurrence policy is the safest coverage for building owners who intend for their contractor to provide the maximum liability coverage that is straight forward and to the point. It is strongly recommended that prior to hiring a contractor the building owner check to make sure an Occurrence liability policy is in place.

If your contractor is carrying a Claims Made policy request that they add the Supplemental Extended Reporting Period endorsement. This way you will protect your business from a possible unexpected financial hardship due to property damage or personal injury.


Wow,that was a lot of information!! Stay tuned for Part 3, things get really exciting there!!!

Flat roofs. Flat roofing.  Roofing. Roofing materials. Roof repair. Roofing Contractor. New roof. Metal roof. Commercial roofing. Roof Replacement. Cool roofs. Cool Roofing. Roof Coating.