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Coverage Compliance Verification© Program


Robert J. Marshburn, CRM, CIC, ARM, CRIS, CISC, CCIP



Much time and expense is involved to establish effective Indemnity and Insurance requirements from your Vendor/Contractors to protect them and you from the liabilities they can cause.  How do you know if they are actually complying with your Insurance requirements, especially with so many Insurance Companies issuing “Restricted Coverage” policies that offer deceptively inferior insurance coverage?


How do policy exclusions affect the Vendor/Contractor?  There is no coverage.  How do they affect the Additional Insured named on their policy?  The same way - There is no coverage! 


Many things NOT shown on Certificates of Insurance (COIs) endanger your Liability protection from the Contractor’s Insurance Policy if there is substandard coveragemany of which they or their insurance Brokers may not even know about!


At one professional graduate educational insurance workshop, the chief nationwide claims executive told a stunned group of insurance brokers: "Brokers need to understand that we don't expect to ever pay a claim under this type of policy. All they are getting is paper to allow them to get on the job"

1.     COIs will NOT show if coverage complies with your Contractual requirements – the Certificate of Insurance picks and chooses what to tell you – and can leave you with NO coverage even though there appears to be apparent document "compliance" with your requirements!

2.     COIs will NOT show “Restricted Coverage” policy exclusions & endorsements that result in NO coverage, or reduced coverage for you – There are many of them!

        a.     Restrictions, Exclusions, or Limitations for location, types of ongoing or completed operations liability, type of work, etc

3.     COIs will NOT show exclusions or limitations for Contractual liability coverage, changes to the “insured Contract” definition, or Vendor/Contractor employee “action over” exclusions—all of which result in no coverage for your Indemnification on very expensive matters!

4.     COIs will NOT show exclusions for Property Damage liability done by Subcontractors

5.     COIs will NOT show Prior work exclusions, including:

        a.     Montrose exclusions, Continuous injury coverage exclusions, Modification of Occurrence definition, Continuous and Progressive or Pre-existing Damage endorsements.

        b.     All of these endorsements can have the effect of deleting Completed Operations Coverage, including Construction Defect coverage for you!

6.     COIs will NOT show “Contractor’s endorsements” that change or exclude coverages that are otherwise included in standard policy provisions!

7.     COIs will NOT show waivers of subrogation – they must be attached as copies of as actual policy endorsement - note merely stated on the COI.

8.     COIs will NOT show if coverage is primary for Underlying & Excess policies

9.     COIs will NOT show specific Additional Insured Endorsements & Compliance for ongoing and completed operations liabilities – they must be attached as copies of actual policy endorsements.

10.   COIs will NOT show details of any large SIR endorsements and their very real dangers.

11.   COIs will NOT show verification of Insurance for any Subs hired by your Contractor.

The worst part – Under many of the Additional Insured forms, your written Contract must specifically and correctly Require (1) the limits and (2) the extent of coverage or there is NO coverage beyond the explicit written Contract Requirements even if the policy would otherwise have provided for the coverage!  Click the following link to see how No clear Contract Requirement = NO COVERAGE!


If you are relying on Certificates of Insurance, you may have Document compliance with all your requirements, but may very well not have Coverage Compliance© due to policy exclusions and limitations such as those shown above!


Our Coverage Compliance Verification© (CCV) Program handles these issues and more.  This is much more than tracking Policies, Limits, and Additional Insured Endorsements with Certificates of Insurance — Our Program actually verifies Coverage Compliance© with your customized Contract Insurance Requirements for each item for each Contractor!


HOW IT WORKS—Upon receipt of (1) your brief Intake information and (2) your Contractual Insurance Coverage Requirements, we provide you

1.     An Addendum (as needed) of valuable Insurance requirements that may not be in your Agreement's Insurance Requirements and are important to the verification of  Coverage Compliance© along with Risk Management provisions and detection of the coverage gaps, exclusions, difficulties, and complexity of Traditional or Wrap-Up insurance policies.

2.     We (you and/or us) Prepare and Provide the Insurance Requirements Guide for the Contractor/Vendor to comply with.

3.     We (you and/or us) work with Contractors to facilitate and verify Coverage Compliance© and keep you advised of communications.

4.     All data and documentation of Coverage Compliance© (or Non-Compliance) is provided to you for each item of your Insurance requirements for each Contractor along with copies of all documents and communication.

5.     All communication is based upon your staffing model choices and contact preferences, your specific insurance requirements, and our proprietary Coverage Compliance Verification© system with our Database of Restricted, Prohibited, and Approved endorsements helping to identify policies or endorsements that could reduce or exclude your coverage protection.

In addition to working with and overseeing the Coverage Compliance Verification© system, if you desire Risk Management consultation regarding special circumstancesperhaps assistance with an initial setup or review of your Insurance Specifications or Indemnity requirements; requiring higher limits or additional coverage; a reduction or waiver of some requirements for specific items or projects, etc. we are available for such consulting on a reduced fee basis in connection with the Coverage Compliance Verification© program. 


If you would like to investigate the labor-saving and risk-reduction cost benefits of the Coverage Compliance Verification© Program please contact me directly at Bob@CertifiedRiskManagers.com or my direct line at 949-613-7075, or you can get started by filling out and returning to my email the questionnaire here.


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