Certificates of insurance and now AIA has more for you

[URDRWHO]

Ninety five percent of my business is with contractors. As if completing the COI to meet the contract language was enough, AIA is trying to push more out the door. I notice more of AIA's favorite word "similar". Similar? What part of similar do they want? Would the contractor accept a painter saying you wanted Crest Green but he used something similar. Similar in the eyes of who because it wasn't crest green? It may look similar to the painter but not to the homeowner.

I see the use of this similar technique such as a contract saying CG 20 37 or its equivalent. We can all guess at what they might want but the only time we can be assured is when standing in court. Blacks Law does not define equivalent, equitable yes but not equivalent.

I just saw were a general contractor completed their own sample Acord 25 and they want mine to be written as they have written it. Hm? Using copyright / trademark forms without permission eh but I digress? On the COI they want me to write in the Commercial General Liability box Contractual Liability Included. Let's see who can spot the problem of such broad wording. Hint - insured contract is an exclusion to the exclusion - CGL Exclusions b. (2).

They want me to place that XCU is included. Well this is 2020 not 1980 and I may write that XCU is not excluded by endorsement.

So now to add to the party we have the AIA Form. They would want us to say yes without any chance of mentioning exclusions. Is this AIA Form a new E&O agent noose and has anyone seen any in the real world?

http://content.aia.org/sites/default/files/2017-10/G715-2017.sample.pdf

 

[InsCommentary]

I've written and spoken about certificate issues for 20 years. Someone insists on form CG 20 10 11 85 "or its equivalent." If it's not the CG 20 10 11 85 verbatim, it's not "equivalent."

This form's General Liability section asks, "Does this policy include coverage for...The Contractor's indemnity obligations included in the Contract Documents?" I've never seen a CGL policy that complied with any construction contract's indemnity agreement. The answer to this question would always be "No," so why ask it?

Question 2 asks if the policy has an exclusion or restriction of coverage for claims by one insured against another insured. I know they're interested in any cross-liability exclusions, but the reality is the ISO CGL does have a limited employee vs. employee exclusion in the Who Is An Insured section. So, to answer truthfully, you'd have to always check "Yes" and deal with the consequences.

This is supposed to be a supplement to the ACORD 25. That's a LIABILITY certificate, so why does the form ask questions about first-party property and inland marine coverages?

These "Agent Affidavits" or "Compliance Checklists" are nooses created for agents to stick their necks in so that if a CGL claim denial can be connected to this form, the backup coverage is the agent's E&O policy.

 

[AZDave]

For these type of Affidavits I refuse to complete, but i do edit these and return. Leave check boxes blank, and add bold wording: " see attached issued CGL policy #xyz123, after each and every question that cannot be simply answered, and attached the full PDF policy.

Or you could add a 4th box for "sometimes", or "maybe", and check that.

As Bill said, these are traps for the Agent!

Good Selling!
Dave

 

[URDRWHO]

I agree, they are traps and traps I will not fall into. Never have --- never will but it is good to make notice of these traps for the newbie's on the block.

 

[fed up]

Far too many contractors do not think through what seems, to them, a simple request. "Just put such and such in there." They don't realize that if you do as they ask, you become the insurer, not the insurance company.