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Up Topic Welding Industry / Inspection & Qualification / Liability Insurance for Inspectors - Errors & Omissions
- - By thirdeye (***) Date 02-01-2011 19:06
Fellow CWI's & Inspectors,

I know we have visited about insurance over the years, but I'm getting feedback from my carrier that they want me to put an errors and omissions adder onto my general liability policy.  The matter is not really up for discussion, and they are talking a non-renewal if I don't see things their way.  I am curious if anyone else is receiving similar information from their insurance folks....  I have a small business doing CWI and NDE inspections, mostly in shops (verses at field locations).

And I'm really curious if you have discussed E&O coverage, but you (or your underwriter) were able to conclude that E&O was not needed.

~thirdeye~
Parent - By welderbrent (*****) Date 02-01-2011 23:32
It was not my insurance carrier that REQUIRED the E&O but my customers.  My carrier was more than happy to leave me with just my shop coverage when I first started doing inspections.  Compared to my shop volume and coverage amounts they had no problem just knowing that I was also an inspector.  My 'shop' is a fabrication shop not a working facility for inspections (though I do also certify welders at my shop).

But, it didn't take long and my customers had me on jobs where the E&O was a mandatory thing. 

I could see their point especially if inspections is about all you do.  And it won't matter rather it is shop and/or field.  The risks are the same.  Even if they brought it to YOUR shop facility. 

Have a Great Day,  Brent
- - By bmaas1 (***) Date 02-11-2011 20:26
What isnurance company(s) handle this type of coverage?

Brian
Parent - - By thirdeye (***) Date 02-11-2011 21:32
Brian,

Many companies offer commercial GL policies, which is called the standard market.  When agents or brokers can't find a company that will write a policy because the risk is unique (and in my case, sometimes they are just too unfamiliar with what I really do) they will turn to a speciality market, also called surplus lines, or non-admitted market. Errors and Omissions falls into specialty coverage.

A good place to start is at your State Department of Insurance website. You will find agents who are licenced for commercial insurance, and also who handles surplus lines. You can also call other inspectors or inspection companies in your area and ask which insurance agency they use, and contact them for a quote.

The next best advice is to really work with your agent so that they have a good understanding of the business (whatever it may be). That said, When I put my business insurance out to quote, I give the agent a 3 or 4 page document with photo's, certifications, and a resume. then follow up with them BEFORE they visit with the underwriters to make sure they don't have any questions.

~thirdeye~
Parent - - By welderbrent (*****) Date 02-11-2011 22:34
Very good points there thirdeye.

I went through a lot with my current agent so he understood what I was doing.  When he came back you should have seen the questionair the underwriters had sent him.  I felt like I was trying to get top secret government clearance.  But they came back with a pretty good quote.

Have a Great Day,  Brent
Parent - - By dbigkahunna (****) Date 02-11-2011 23:54
Shop insurance agents. Some of them are dummer-a-skid!
I have a E&O as a rider to my PL umbrella. I have a $500K PL single incident with a $3M total cost umbrella.
I talked to several commercial line insurance agents and I when I went to the one that got my insurance, I told him what I needed. He asked what I did, who my clients were and my experience. He called the next day with two quotes. My total cost is less than $800 a year.
This is in Texas. And I live in a place where this type of insurance for "consultants" is not uncommon.
Parent - - By dmilesdot (**) Date 02-16-2011 15:25
I am currently going thru the same thing with several insurance agents. I started my own business at the end of last year and I have been trying to get a reasonable quote on E & O insurance.  The cheapest quote that anyone has given me is 7500.00 per year.  Now to me thats outrageously high.  Im in upstate NY and Im wondering if its because folks up here are suit crazy.  Although I have never heard of an inspector getting sued over screwing up and inspection.  When you look at what we do, the accept/reject criteria is preestablished by the code.  We dont just decide whats good and whats bad, it all comes from the code book.  So I stilll dont have E & O, still waiting on two agents to get back to me.
D
Parent - - By welderbrent (*****) Date 02-16-2011 21:27
Dmilesdot,

Mine is slightly lower than that but the people I work with, both in CWI and other inspections such as masonry, concrete, compaction, etc., all tell me theirs is $7500-8500 per year.  Sounds like yours is right in line with the others.  I was told they have a minimum for E&O regardless of how much you make or how large the project.  As either/both of those go up your rates will start going up as well. 

Join the fun. 

Have a Great Day,  Brent
Parent - By thirdeye (***) Date 02-17-2011 15:43
Brent,

Often the minimums are set by the insurance company (not the agent), and they are a minimum charge per account, not actually based on type of coverage they are writing.  A few years ago, I was able to cut my preimium in half by changing to a company that did not have a minimun charge.
Parent - By thirdeye (***) Date 02-17-2011 15:38
Dmilesdot,

Location may play a big part in the cost, and like you mentioned "suit crazy" would be considered.... but $7K is high, unless you have a lot of inspectors on the payroll. 

I have a disclaimer that appears on all of my reports, and I hope that is a factor for the underwriters.

~thirdeye~
Up Topic Welding Industry / Inspection & Qualification / Liability Insurance for Inspectors - Errors & Omissions

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