|
|
|
|
General Business PUBLIC LIABILITY Types Of Policy There is really only one of policy; the general TP policy provides cover in respect of third party indemnity only. However, may composite policy contain a PL section of these being? Contractors all risks House owners/ householder Engineering insurance Golfers indemnity Sometimes, the general TP policy is modified to cover a certain class of individuals or risks: PL (pedal cyclist) PL (citizens) PL (farmers) The following note will be confined to the general third party because the PL section in composite policy the specially modified policies requires few additional endorsements or modification of terms but the principle are the same as the general TP policy. The general TP policy can be used for all types of PL risks and therefore may required some additional modification or typing to fit the insured’s particular requirements or to exclude or modify the cover if the company is unwilling to cover certain aspects of a risk . Policies may be extended to cover product liability or other risks and this aspect will be considered later: Events Insured Against: A section of the operative clause has been left blank so that the required clause will be completed as the policy is typed. The operative clause states it will indemnify the insured for: i) Liability at law to pay compensation for: a bodily injure (except injury to an employee who would be covered under the WC decree) to any person not a member of his family or engage in a service at the of injury. b damage to property not belonging to the insured or to a member of his family nor in the insured’s custody or control. ii) Laws costs and expenses arising therefrom: The blank space then is completed, the wording may vary according to the risk and whether the risk is confined to the premises only or whether it will extend to cover the act of insured or his employees away from the insured premises Suitable wording will be given at end of these notes: The operative clause is very wide in scope but the term of the cover is restricted by the policy exception, which are of the utmost importance. Most of the exception are printed on the loose page, (known as an intercalary) and stuck into the policy prior to issue. The policy is one of indemnity and subject to the terms of condition and exceptions will provide monetary compensation for injury or damages to other provided the insured is legally liable to pay for that injury or damages. Underwriting Consideration For the majority of premises risks, the basic considerations are similar e.g. spreading fire, access by the public, general state repair but there may be special features, which increase the risk. The proposal seeks to identify the most common hazards but it is impossible to legislate for every situation and successful underwriting will depend upon the intelligent application of general underwriting principles. ExclusionsIt is of utmost importance that the underwriter should read and understand the reason for the exceptions to the standard policy. Certain exceptions may be modified upon request return for additional premium and others must not be modified at all. The following note provides brief comment upon the PL exceptions and the underwriter must refer to the policy form and read in conjunction with the notes. a) Excluding liability of an insured legal liability at law any additional liability, which he would not normally be under: The policy covers only the insured legal liability at law any additional liability which the insured incurs is not covered by the standard policy. There are occasions when underwriters are requested to alter this wording. Enquiries must be made as to reasons for the request, and the additional liability incurred. The additional responsibility must then be considered and the AGM’s authorization should be obtained before any cover given. For example, a landlord by the terms of his lease may require his tenant to maintain the premises in good order and failure to do this would render the tenant liable at law. b) The policy excludes fire, natural catastrophe and war risks for which the insured must prove that any claim was not caused by one of the named excluded perils. Fire (and explosion) may be covered on payment of additional premium according to the nature of the risk (see separate section). Flood is a catastrophe peril and requires special consideration (see separate section). c) Injury or damage caused by any sub contractor or his servant or agents: The insured will be liable for the negligence of sub-contractor or his employees only in special circumstances ie. when the insured plant is being used or if the insured interferes in the control of the work, or the work contracts to be done is unlawful or essentially dangerous or involves the creation of dangers on highway or where there is a statutory obligation to do the work properly . However, there is always the possibility of an ill found claim against the insured with all the attendant expense, and where the work being sub-contracted is considerable any legal liability of the principal (the insured) should be covered by the policy at additional premium. d) Excluding loss or damage caused by any animal, vehicle, cycle locomotive, vessel, craft, life crane or power boosting machinery. Normally most of these risks should be covered by a separate policy, but occasionally consideration may be given to extending the policy, for additional premium, to cover for example, contractors plant working on a site which is not licensed for road use and where certificates of insurance are not required by Road Traffic Ordinance. Very careful consideration must be given before extending cover in respect of excluded perils and would be subjected to the approval of the head office. e) Excluding water damage arising out of defects in buildings: This is largely self explanatory e.g. a landlord may let a building for an offices and if roof leak and water pipes burst and allowing water to enter his tenants premises, no claim could be made to the policy. f) Excluding injury or damage arising out of an accident to any vessel craft and rolling stock: many harbour authorities and railway authorities requires an contractors working on their premises to indemnify them in respect of accidents. Under no circumstances should this exclusion be modified. g) Damages caused are excavation or weakening of supports to any land properties or building or damage caused is digging by operation to properties beneath the ground. This exclusion is self-explanatory but it is probably more usual to request to extend the PL section of a CAR policy. This cover is normally only requested when there could be real be possibility that damage caused by the insured operation. This is not an exclusion we would wish to amend. h) Damage to properties due to its being or having been subject matter of work where the loss or damages is or has being caused by it process of carrying out such work to cover this liability would virtually amount to giving a guarantee of satisfactory workman ship of the person concerned. Claims would inevitable sooner or later when the insured occupation was such that a large amount of work was done on other people’s goods. The purpose of PL is to cover the ordinary risk of negligent which may or may not arise in the course of insured’s business. i) Excluding damages and injury ............ to the harmful effects of goods supplied or professional services rendered. This exclusion intended to exclude claims for food poisoning or defective part fitted when the insured is a repair. Professional service would exclude for example, negligence treatment by a doctor or negligence work performed by an accountant and these risks could be covered under a separate professional indemnity insurance policy and we do not write professional covers. Food poisoning risk could be covered on the payment of additional premium subject to satisfying particulars being available. j) Excluding damages or injury arising out of any work undertaken by the insured under contract unless such injury or damage occurs during the actual process of the work. The indemnity is only secured during the progress of the work and does not for negligent after the contract has ceased. This exclusion must not be removed. k) Excluding explosion, insured must prove that any claim was in no way connected with this excluding peril. This would exclude boiler explosion for which specific policies are available from engineering office or any other explosion which might occur explosion as such is not a risk we would wish to cover because an accidental explosion would almost certainly do injury or damages surrounding property. The policy also contains a condition to employ only steady sober and component workers and that the insurer’s furniture, structures and plant are substantial and sound and in proper order. This condition is reasonable, fair and self-explanatory but should be remembered when scrutinizing the proposal, carrying out a survey and most especially in dealing with claims. A breach of this condition could be sufficient grounds to repudiate a claim if, for example, a property owner allowed his property to fall into a ruinous state, and despite complaints refused to repair. Any claim occurring because of the state of repair could be repudiated. Indeed, the policy should be cancelled at the first opportunity due to the bad moral hazard. Condition 8 of the policy permits premiums being based on an estimate furnished by the Insured an alternative to flat rate. Due to effects of inflation. It is an advantage to base premium where possible or wages paid as these tends to increase in line with the inflation rate. Flat premiums should only be charged on the simplest of risks because the same rate will apply for long period and inflation may make it necessary to increase the premium. It is then very difficult to convince an insured, who may not have made any claim as to the reason why an increase in the premium is being sought. The drawback of a premium based on an estimate, is that at the end of each period of insurance a declaration must be obtained from the insured and the adjustment endorsement issued. General considerations a. Limit of liability anyone loss b. Limit of liability anyone period of insurance. c. The nature of the business of the insured/degree of explosion d. The extension required |
Quick Links
For details of Branch Network and Managers Nationwide select the appropriate location below:
|
|
© 2002 Copyright Niger Insurance Plc. Website designed by Tritech Computers Ltd. E-mail:- webunit@tritech-computers-ltd.com |
