We manage more than a quarter billion dollars of premiums for a diverse range of clients around the globe.
Errors and even outright fraud in certificates of insurance is a growing problem. We encounter a 70% noncompliance rate on initial documents. The certificate of insurance compliance function protects a company by ensuring that its contractors have appropriate types and amounts of insurance coverage. The burden of this compliance process is often underestimated.
With all the rules and regulations with which a business needs to comply, an often overlooked area is workplace safety compliance and, specifically, the implications of the Occupational Safety & Health Administration or OSHA. On top of avoiding workers compensation and worker-related frictional costs (production loss/worker distraction, training costs/replacement worker, loss of skill/efficiency – slowed production, administrative time, etc.) compliance can help avoid the penalties that OSHA can impose.
Risk, construction and compliance are three concepts that weigh heavily on the minds of owners and contractors globally. This was evident at the recent Risk & Compliance Summit held at Georgia Tech in Atlanta last week.
Monitoring insurance compliance in contracts is an important, albeit challenging, risk mitigation strategy. Read Al Sica’s recent article on the subject posted on Construction Executive Magazine website.
One of the most commonly found clauses in any construction contract is the requirement of one party to name another party as an additional insured. It is found in The American Institute of Architects (AIA) documents, the Consensus DOCS, and was inserted in almost all manuscript agreements.
So you may have received a Certificate of Insurance (COI) from your vendor, and you feel comfortable that its employees now can be allowed on your building’s property. To you this may seem like they have given you a familiar card from Monopoly. With your supposed “get out of jail free” card, you allow vendors access to your building and allow contractors to perform work on your property. However, you may not be as “free” as you think.
