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ACE Advantage® Contractors Professional Liability

As the lines of responsibility between design firms and contractors continue to blur, contractors are assuming nontraditional risks that their core insurance coverages may not address. Professional Liability coverage has become just as essential to a contractor as it is to an architect or engineer. New methods of project delivery have created challenges and exposures that need to be understood, assessed and adequately insured by the parties accepting the risk. One of the most significant challenges faced by risk managers is identifying and managing risk when design and engineering responsibilities are shared among many project participants.

The ACE Advantage® Contractor's Professional Liability insurance program is designed for contractors with the design-build or construction management responsibilities. Underwritten through ACE Professional Risk, the program is designed to help take the worry out of construction projects and let companies focus on what they do best.

Benefits:

  • Claims and underwriting expertise
  • Regional offices provide customers with countrywide access to underwriters knowledgeable about local issues
  • Flexible underwriting approach
  • The financial strength of ACE

Coverage:

  • Free pre-claim assistance
  • Broad definition of professional services
  • Contractors Pollution Liability (CPL)
  • Blanket additional insured status for all clients of Named Insured for pollution incidents
  • Joint venture coverage
  • Predecessor firm coverage
  • Supplemental coverage for Insured expense reimbursement $300 per/day
  • Innocent insureds coverage
  • 60-day Automatic Extended Reporting Period
  • Punitive damages with most favorable venue
  • Three-Year Optional Extended Reporting Period
  • Claims-made coverage with circumstance reporting provision
  • Claims mediation credit up to $25,000
  • Supplemental coverage’s for ADA & FFHA fines, sanctions or penalties
  • No lead or asbestos exclusion
  • Specific project excess limits
  • Primary and excess coverage available
  • Automatic subsidiary coverage
  • Worldwide coverage

Client Profile

U.S. domiciled contracting firms qualified to engage in the design and construction of traditional building construction, infrastructure and land development projects and that are responsible for providing the following services:

  • Design/build (self performed design)
  • Design/build (non-self performed design)
  • Design delegation
  • Construction management (at risk)
  • Construction management (agency)
  • Self performed design

Claims Examples

  • A contractor was hired to build a call center using design-build project delivery. The General Contractor retained a design professional to design the facility and successfully secured indemnification and hold harmless agreements in the contract. At the completion of the construction phase, it was discovered that insufficient design of the utility conduits prevented certification of the facility, resulting in significant delays. By the time suit had been brought the design professional declared bankruptcy and the general contractor was unable to enforce the indemnity agreement. The contracting firm incurred $1.5 million in defense and indemnity costs.
  • A general contractor was retained by a biopharmaceutical firm to design and build a “state of the art” process facility. Cracks appeared in the ground floor slab approximately one year post completion. After extensive forensic research it was determined that the slab was under-designed and was unable to support the manufacturing equipment. The cost for slab replacement exceeded $600,000.
  • A construction management firm responsible for the management of multiple subcontractors failed to adhere to change order provisions in the client contract. The failure to coordinate, manage and report changes to the owner resulted in project delays and contingent business interruption damages in the amount of $570,000.

 

The claim scenarios described here are hypothetical and are offered solely to illustrate the types of situations that may result in claims. These scenarios are not based on actual claims and should not be compared to an actual claim. The precise coverage afforded by any insurer is subject to the terms and conditions of the policies as issued. Whether or to what extent a particular loss is covered depends on the facts and circumstances of the loss, the terms and conditions of the policy as issued and applicable law.