Like many of you, we do our fair share of subcontract work. I know when our Work Comp is close to expiration my email will be blowing up with requests for COI's. Not a big deal. Here is where I would like you guys opinion.
Just now I recieve an email. We need your COI. Ok. I respond, attach our COI and we're done with it. Two seconds later I recieve an email saying we didn't list X company as additional. I let them know if they have a project they would like us to work on, I have no problem listing them.
Years ago our agent told us this was basically letting them have free insurance and exposing ourselves. What do you guys do? I hate being a jerk about things, but I don't want to list X company as additional insured if we never do anything for them. This particular company told me I was now removed from their list.
I have to chuckle at this whole scenario as I go through the exact process you have outlined on a regular basis.
Your potential customer wants to be listed as an "Additional Insured" on any project and you want it to be project specific. Most national vendors or NSP's want to be listed as an "Additional Insured" and if you don't list them this way, they won't sign any agreements. Some GL policies charge for the "Additional Insured" and some, like mine, do not. Depends on your policy company of record.
You are basically worried that you are giving your potential customer a free ride to use your policy whenever the need arises. That usually is not the case if you are not the contractor of record on any project. Can I absolutely say this would never happen, no, but not likely. In my years off issuing coi's to potential and actual customers, I have not had this happen to me.
Heck, you can have the police mis-identify you as the person at a crime scene. This is not the normal, but it does happen and you can't prevent all situations from haunting you.
If you solicit a lot of national types, NSP's or even large end customers such as Starbucks, Petco, Exxon, etc., get used to it. You will hand out certificates with this proviso regularly. You have to decide who you will solicit and will provide insurance to. But the number of certificates can be vast.
And just to make this whole process even more sticky, wait until the words "Waiver of Subrogation" come up. This is monster all its own. And in some cases with some vendors like FM Maintenance, they want either an umbrella policy to raise the aggregate limit to 3 Million or have you raise the aggregate limit on the policy itself.
The fun never ends with insurance and its effect on the construction industry.
Best of luck going forward....
