At last count, the VU “Ask an Expert” service had received 15 questions concerning the difference, if any, between coverage afforded by inland marine installation floaters and riggers liability forms. For example: “I am working on a crane company prospect and am not the current agent. The current agent is using an installation floater to cover items being lifted. I think that riggers liability coverage should be used and the insured may have some coverage issues. What are your thoughts?”

Since there are no true standard forms, it’s very difficult to make more than generalized statements without comparing the coverages in question. The AAIS form is the closest thing to an industry standard and it says: “Rigging contractors are contractors who offer lifting services to others. Rigger’s liability coverage is specifically designed to provide coverage for contractors who lift, move and set in place property of others. Covered property consists of the property of others that is being lifted. “Installation floater coverage is designed to provide coverage for a single construction phase or process (e.g., plumbing, dry walling).

Installation floaters are intended to cover materials, supplies, machinery, fixtures and equipment that are part of an installation, fabrication or erection project. Materials, supplies, machinery, fixtures and equipment can be the insured’s property or property of others.

“Some insurers may use an installation floater to cover rigging contractors, especially if the contractor sometimes operates as building contractor and sometimes as a rigging contractor. The installation floater is broad enough to cover both types of risks while the riggers’ liability form is specific to contractors who only do rigging work.”

To review a number of issues addressed by the VU faculty,  click here.  

HO Policies and Illegal Music Downloads

Recently, in the case of BMG Music et al v. Cecilia Gonzalez, a federal court ruled that the illegal song download by a consumer constituted copyright infringement and awarded damages against her of $22,500 for downloading 30 songs ($750 penalty per song). The defendant had actually downloaded 1,370 songs and, under federal law (while it is highly unlikely), the damages could have potentially been assessed at $30,000 per song, or over $41 million.

Chances are good that someone in your or your customers’ household is downloading music or other types of files from iTunes®, other online services or a peer-to-peer file-sharing network. It is also possible that someone is illegally downloading these files. Are the increasing number of claims and lawsuits against consumers covered by a homeowners policy? If not, can coverage be added by endorsement?

To determine if there’s homeowners coverage, answer these questions: First, has there been an “occurrence”? Second, has there been any “property damage”? Third, does the “intentional loss” exclusion apply? As for endorsements, the HO program has a personal injury endorsement similar to CGL Coverage B, but does it cover copyright infringement?

For more information,  click here.

Occurrence vs. Claims- Made: Which is the Best Value?

A state passed legislation requiring licensed contractors to carry liability insurance. CGL premiums for small contractors from the markets range from about $4,000 to $6,000. However, some agents are aggressively marketing claims-made CGL policies for only $1,500. The question is: Which policy— occurrence or claims-made—is the better value?

Occasionally, an insured is faced with the decision of whether to purchase a claims-made policy or the more traditional occurrence form. There are legitimate reasons why an insured might prefer a claims-made vs. occurrence policy. For example, with long-tail exposures where there might be a lengthy period of time between occurrence and claim, such as in medical malpractice insurance, the claims-made policy might be the superior approach.

However, there are downsides to claims-made coverage as well. As for the value, that’s more complicated than it sounds.

For a complete analysis and an article to share with clients,  click here.

Bill Wilson (bill.wilson@iiaba.net) is Big "I" director of the Virtual University, an online learning center for agents and brokers.