Why Finding Affordable Insurance is a Nightmare for New York Elevator Contractors (And Some Hope)

For elevators contractors and other contractors in the construction industry that work at heights, finding business insurance can be both difficult and expensive. There are very few insurance carriers willing to take on the general liability risk. The ones that do know there are limited options and many contractors may feel that over-charge on premium because of this.

This problem is only exacerbated in the state of New York because of the Scaffold Law. The Scaffold Law imposes an absolute, non-delegable duty upon owners and general contractors to provide a safe working environment for laborers who work at elevation to protect them from gravity related accidents such as falling from heights or being struck by a falling object. That means that even an employer has in place the most thorough and careful safety program and a worker failed to obey the safety guidelines or was negligent, the employer can't even raise a defense.

As a result, insurance carriers that may be willing to write contracting risks that work at elevation in other states, will not do so in New York. Consequently, an already slim and expensive insurance market is even slimmer and more expensive in New York. That makes avoiding having an adverse loss history absolutely imperative. According to the Lawsuit Reform Alliance of New York, losses for construction projects in New York are 300 percent higher than anywhere else in the country.

All is not lost, however. Connor & Gallagher has made these type of risks a priority over the past two decades and as a result has maintained strong relationships with the small number of carriers willing to provide coverage at a price that is not unreasonable or burdensome for business owner. Of course, having a favorable loss history can only help make it easier and less expensive. A few ways to avoid losses:

• Maintain a thorough safety program.
  • Make sure your workers are well versed in your safety policy and, most importantly, make sure that they obey it.
• Have a thorough hiring practice.
  • Require prospective employees to pass physicals and a pre-employment drug test. Hiring skilled and competent workers that you can trust is imperative, especially due to the New York "Scaffold Law."
• Consult Your Insurance Broker
  • Throughout your policy term your agent can help you ensure proper risk transfer. This is especially helpful when working on large, complex projects.

With the recent increase in construction projects, contractors have a great opportunity to experience growth in the coming years. Perhaps no impediment is more effective at derailing your company's growth that a large loss - especially one that is not covered. For this reason you should also make sure your insurance agent goes through any exclusions that may be including on your policy before purchasing it. A good indication that your policy features a lot of exclusions is if it oddly cheap - if something seems to good to be true, it probably is. But again, that doesn't mean affordable policies are not available. You just have to go through a broker that is both experienced in insuring height-related risks and one that has partnered with all the carriers willing to provide coverage.

For a free consultation, or to find out which carrier is the most affordable for you, contact Steve Gallagher at sgallagher@congalins.com or call 630-810-9100.

(H/T Risk and Insurance)