Commercial general insurance (sometimes referred to as public liability in the UK and casualty in the US) provides indemnity for legal liability following third party property damage or third party bodily injury arising from the insured works.
Cover can typically be extended to include the interests of the various parties to a construction contract. This could include amongst others the main contractor, the owner/developer and lenders.
The policy will cover liabilities that arise both in contract and in tort (e.g. negligence, breach of statutory duty) and is typically arranged on a ‘claims occurring basis’, i.e. the policy will respond to claims occurring during the policy period, irrespective of when the claim is subsequently made.
Specific policy coverage may encompass:
- Pollution and Contamination which are typically subject to an aggregate limit. Liability arising from pollution and contamination will be limited to sudden, accidental and unexpected incidents. The policy should include cover for legal costs incurred or awarded against the Insured, but it will not respond to fines or penalties imposed.
- Financial Losses brought by third parties following third party property damage or bodily injury; and without through a pure financial loss clause – although this would typically see restrictions in limits, increase in deductibles and premium.
It is of particular note that, due to the litigious nature of liability claims in the US, Casualty policies in this territory are very different in their design, structure, content and placement than third party liability policies elsewhere.
WHAT WE DO
We work on behalf of owners, developers and contractors alike to ensure robust third party liability insurance programmes are in place. We will ensure that suitable limits are established to cover potential third party liabilities arising out of a specific project or business activities as contractual minimum limit requirements will not limit your liability to a third party in the event of a claim.
The limit purchased may be driven by either contractual factors (minimum limits imposed by the owner or developer or even by third parties) or the third party risks present. JLT will assist the client in assessing these factors, which may include the proximity of third party risk, the type of risk, potential consequential losses following injury/damage and maximum potential loss exposure.
We work with contractors where they are contractually obliged to arrange third party liability insurance and the owner/developer asks them to provide infill cover for the liability that attaches to the owner/developer in the absence of negligence by the contractor.
Alternatively, we design, place and manage owner coordinated insurance programmes (OCIPs) for owner/developers where the third party liability insurance is extended to include the contractor, the policy in effect automatically covering the liabilities of both parties. This avoids disputes between project parties and their insurers.
JLT provides third party liability insurance broking, risk management and claims consulting services to large corporate companies globally.
Our success comes from focusing on sectors, such as construction, where we know we can make the greatest difference, using insight, intelligence and imagination to provide expert advice and robust - often unique - solutions.
In the third party liability space this could include potential programme structures such as excess of self-insured retentions, long term agreements, the development of new markets and facilities which deliver innovative solutions.
We build partner teams to work side-by-side with you, our network and the market to deliver responses which are carefully considered from all angles and a primary point of contact ensures our clients can access a team with the breadth and depth of experience to meet their risk and insurance needs.
With over 375+ construction experts across the global we have the strength in depth to design, place and manage construction third party liability programmes for our clients across a variety of different territories in Asia-Pacific, Australasia, Europe and the Americas including the unique challenges inherent in US Casualty business.