Liability & Insurance

Template 15

Use Template 15 for:

Construction/Encroachments within the Right-of-Way, where a permit has been issued.

    Mandatory Contractual Language

    Insurance requirements should be saved and attached to the contract as an exhibit. To ensure the requirements are included as part of your contract, please include the following language within the insurance section of the agreement:

    _______ is required to maintain the insurance specified in Exhibit _____, which is attached hereto and incorporated herein by this reference.

    Consistent Language

    Edit the template to keep the language consistent with your agreement.

    For example: if the template refers to: “Consultant”, but the agreement uses “Contractor”, change all references in the template to “Contractor”. If your agency is not the County (SCAPOSD, Water Agency, Fairgrounds, etc.) substitute the correct terminology for all references to “County”. If the agreement is called “contract”, “license”, “lease”, etc., edit the template to match.

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    Template Assistant

    Permittee shall maintain and require its subcontractors and agents to maintain insurance as described below unless such insurance has been expressly waived by the attachment of a Waiver of Insurance Requirements.

    County reserves the right to review any and all of the required insurance policies and/or endorsements, but has no obligation to do so. Failure to demand evidence of full compliance with the insurance requirements or failure to identify any insurance deficiency shall not relieve Permittee from, nor be construed or deemed a waiver of, its obligation to maintain the required insurance at all times during the term of this Permit.

    The named insured must match the name of the Permittee. Some policies have several named insureds, but all insureds may not show on the certificate. If there’s no match on the certificate, request a copy of the endorsement showing the full named insured, including the Permittee.

    1. Workers Compensation and Employers Liability Insurance
      1. Required if Permittee has employees.

        Under California’s Labor code, if the party with whom we are contracting is a privately held corporation whose only employees are its sole shareholders, workers compensation insurance is not required. Similarly, if the party with whom we are contracting is a partnership or limited liability company with no employees other than its general partners or managers, workers compensation insurance is not required. A waiver is not needed.

      2. Workers Compensation insurance with statutory limits as required by the Labor Code of the State of California.
      3. Employers Liability with minimum limits of $1,000,000 per Accident; $1,000,000 Disease per employee; $1,000,000 Disease per policy.
      4. Required Evidence of Coverage: Certificate of Insurance
    2. General Liability Insurance
      1. Commercial General Liability Insurance on a standard occurrence form, no less broad than ISO form CG 00 01.

        ISO (Insurance Services Office) publishes a standard CGL. Some insurers use that specific form; others use their own form with a different numbering system. Any CGL is acceptable as long as the coverage is as broad as the ISO form.

        An occurrence policy responds if the injury or damage takes place during the policy period. It doesn’t matter when the claim is filed. A claims-made policy responds if the claim (demand for money) is made during the policy period.

      2. Minimum Limits: $1,000,000 per Occurrence; $2,000,000 General Aggregate; $2,000,000 Products/Completed Operations Aggregate. The required limits may be provided by a combination of General Liability Insurance and Commercial Excess or Commercial Umbrella Liability Insurance. If Permittee maintains higher limits than the specified minimum limits, County requires and shall be entitled to coverage for the higher limits maintained by Permittee.

        Occurrence limit: the most the insurer will pay for any one accident.

        General Aggregates: the most the company will pay for all claims resulting from damage or injuries that occur before the work is completed, regardless of the number of accidents, injuries, claims or claimants.

        Products/Completed Operations Aggregate: the most the insurer will pay for all claims resulting from damage or injuries that occur after the work is completed, regardless of the number of accidents, injuries, claims or claimants.

        A policy with no general aggregate is acceptable because there’s no annual cap on the amount the policy will pay.

        A Commercial Umbrella or Excess Liability policy provides additional limits which are usually shown on the Certificate of Insurance. The additional limits are added to the General Liability Limits. The combined total of the Excess or General Liability Limits and the Umbrella Limits must equal or exceed our minimum requirements.

      3. Any deductible or self-insured retention shall be shown on the Certificate of Insurance. If the deductible or self-insured retention exceeds $25,000 it must be approved in advance by County. Permittee is responsible for any deductible or self-insured retention and shall fund it upon County’s written request, regardless of whether Permittee has a claim against the insurance or is named as a party in any action involving the County.

        Contact Risk Management (Outlook: 139 kB) if the retention or deductible exceeds $25,000.

        We want to verify that the party with whom we are contracting has sufficient assets to fund a large retention or deductible. A waiver is not needed.

        There is no specific field on the Certificate of Insurance for a General Liability deductible or retention.

      4. [insert exact name of additional insured] shall be endorsed as additional insureds for liability arising out of the Permittee’s operations for which the County of Sonoma has issued a permit.

        We must get a copy of the endorsement or section of the policy that makes us an additional insured. A statement on the Certificate of Insurance is not sufficient because an insurance company is bound by its policy and endorsements, not by the Certificate.

        Endorsement CG 20 12 covers the County for liability arising out of the Permittee’s operations for which we have issued a permit or authorization.

        Not acceptableCG 20 10: "additional insured…but only with respect to liability…in the performance of your ongoing operations for the additional insured(s)." With this language the County is not an additional insured because the Permittee is not doing any work for the County.

        Additional insured endorsements which do not include our name are acceptable if they have language granting additional insured status to parties for whom our vendor (or consultant, contractor, permittee, licensee, tenant, etc.) is required to provide additional insured status under a contract or agreement. Submit a HelpRequest (Outlook: 139 kB) if you’re not sure the endorsement is acceptable.

      5. The insurance provided to the additional insureds shall be primary to, and non-contributory with, any insurance or self-insurance program maintained by them.

        Because the County is an additional insured on the Permittee’s policy, we want that policy to cover claims before any contribution from County’s CSAC protection or its self-insured retention.

        Some insurers refuse to add " primary & non-contributory" language. In this situation, you may accept the insurance anyway. Why? Because California Government Code Section 990.8 states that a public agency’s self-insurance and/or participation in a risk sharing pool (CSAC) does not qualify as insurance. Legally, County has no insurance. The coverage provided to County as an additional insured on the Permittee’s policy is the only insurance we have. By default it is primary and non-contributory. It is preferable to have the insurer provide the required language, but not mandatory.

        Marinas & Airport: Because County has commercial insurance for the Marinas & Airport, we require evidence of primary and non-contributory coverage for all contracts relating to those facilities.

        We must get a copy of the endorsement or section of the policy that has the Primary & Non-Contributory language. statement on the Certificate of Insurance is not sufficient because an insurance company is bound by its policy and endorsements, not by the Certificate.

      6. The policy shall cover inter-insured suits between County and Permittee and include a "separation of insureds" or "severability" clause which treats each insured separately.

        This guarantees that the County will be covered if it is sued by the Permittee and that the Permittee will be covered if it is sued by the County. This language is standard in the General Liability policy; you do not need to get a specific endorsement to satisfy this requirement.

      7. Required Evidence of Insurance:
        1. Copy of the additional insured endorsement or policy language granting additional insured status; and
        2. Certificate of Insurance

        (Substitute the following for g. if the work, event or location involves marinas or the airport. Do not leave both versions of g. in the agreement!)

      g. Required Evidence of Insurance:

      1. Copy of the additional insured endorsement or policy language granting additional insured status;
      2. Copy of the endorsement or policy language indicating that insurance is primary and non-contributory; and
      3. Certificate of Insurance
    3. Automobile Liability Insurance
      1. Minimum Limits: $1,000,000 combined single limit per accident. The required limit may be satisfied by a combination of Automobile Liability Insurance and Commercial Excess or Commercial Umbrella Liability Insurance.
        A Commercial Umbrella or Excess Liability policy provides additional limits which are usually shown on the Certificate of Insurance. The additional limits are added to the General Liability Limits. The combined total of the Excess or General Liability Limits and the Umbrella Limits must equal or exceed our minimum requirements.
      2. Insurance shall cover all owned autos. (Required if Permittee owns vehicles.)
      3. Insurance shall apply to all hired and non-owned vehicles.

        Hired Autos: vehicles the Permittee rents or borrows.

        Non-owned Autos: vehicles owned or operated by the Permittee’s employees, subcontractors, agents, vendors, suppliers or exhibitors.

        If "Any Auto" is checked on the Certificate of Insurance, it includes owned, hired and non-owned autos.

      4. Required Evidence of Coverage: Certificate of Insurance
    4. Standards for Insurance Companies

      Insurers, other than the California State Compensation Insurance Fund, shall have an A.M. Best’s rating of at least A:VII.

      A.M. Best is one of the services that reviews insurers’ financial information. We want the insurer to be able to pay its claims. The letter (A+, A, A-, B+, etc.) is Best’s rating of financial strength. The number (XII, VII, etc.) refers to the insurer’s financial size. You can check the rating at: http://www.ambest.com/ - the service is free, but you need to register and log in.

      Department Waiver: You may waive the A.M. Best’s rating if an insurer’s rating is below A:VII.

    Contact Information

    Jamie Bloom, Insurance Manager

    Reesha Ruel, Liability Manager

    Risk Management Division

    Human Resources Department

    Business Hours
    Monday – Friday
    8:00 AM – 5:00 PM
    Contact us by Phone
    Address
    575 Administration Drive
    Room 116 B
    Santa Rosa, CA 95403
    38.465237, -122.725363

    Contracts Exempt from Insurance

    Certain contracts pose low risk, therefore, they are exempt from insurance requirements.

    Learn more