Liability & Insurance

Template 27

Use Template 27 for:

  • Commercial Balloonist Operators

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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(Word: 23 kB)

Template Assistant

Operator 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.  County’s failure to demand evidence of full compliance with the insurance requirements set forth in this Permit or County’s failure to identify any insurance deficiency shall not relieve Operator 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 entity with whom we are contracting. 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 entity with whom we are contracting.

Be sure the name on the agreement is the full legal name of the entity with whom we are contracting and not just a “dba” (doing business as), which is only a fictitious name.

  1. Workers Compensation and Employers Liability Insurance
    1. Required if Operator has employees entitled to Workers Compensation benefits under the Labor Code of California.
      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 Insurance: Certificate of Insurance.

      If Operator currently has no employees entitled to Workers Compensation benefits under the Labor Code of California, Operator agrees to obtain the above-specified Workers Compensation and Employers Liability insurance should such employees be engaged during the term of this Permit or any extensions of the term.

      If the operator has no employees, Workers Compensation insurance is not required. The operator is obligated to obtain the insurance if employees are hired after the inception of the agreement. A Risk Management waiver is not needed if the operator has no employees.

      To verify that the operator has no employees, Risk Management recommends that you have the operator sign the Workers Compensation Declaration (Word: 25 kB)

  2. General Liability Insurance
    1. Commercial General Liability Insurance on a standard occurrence form, no less broad than Insurance Services Office (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. The required limits may be provided by a combination of General Liability Insurance and Commercial Excess or Umbrella Liability Insurance. If Operator maintains higher limits than the specified minimum limits, County requires and shall be entitled to coverage for the higher limits maintained by Operator.

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

      General Aggregate: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.  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. Operator is responsible for any deductible or self-insured retention and shall fund it upon County’s written request, regardless of whether Operator 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. The County of Sonoma, its officers, agents and employees shall be endorsed as additional insureds for liability arising out of the Operator's ongoing operations.  (ISO endorsement CG 20 26, or equivalent.)   ISO endorsement CG 20 12 or equivalent is also acceptable.

      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.

      ISO endorsement CG 20 26 covers the County for liability arising out of the Operator’s ongoing operations or liability arising from premises rented to the Operator.

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

      Not acceptable – CG 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 we are not an additional insured because the Permittee is not doing any work for us.

    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 Operator’s policy, we want that policy to cover claims before any contribution from the Airport’s liability policy, from the County’s CSAC protection, or from its self-insured retention.

      We must get a copy of the endorsement or section of the policy that has the Primary & Non-Contributory language. 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.

    6. The policy shall cover inter-insured suits between the additional insureds  and Operator 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 Operator and that the Operator 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;
      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 Limit: $1,000,000 combined single limit per accident.  The required limit may be satisfied by a combination of Automobile Liability Insurance and either 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 Auto Liability limits. The combined total of the Auto Liability Limits and the Excess or Umbrella Limits must equal or exceed our minimum requirements.

    2. Insurance shall cover all owned autos. If Operator currently owns no autos, Operator agrees to obtain such insurance should any autos be acquired during the term of this Permit or any extensions of the term.
      You do not need a waiver if the Operator owns no autos.
    3. Insurance shall cover hired and non-owned autos.

      Hired Autos:vehicles the Operator rents or borrows.

      Non-owned Autos:vehicles owned by the Operator’s employees and subcontractors.

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

    4. Required Evidence of Insurance: Certificate of Insurance.
  4. Aircraft Liability Insurance
    1. Aircraft Liability Insurance covering hot-air balloons.
    2. Minimum Limits: $1,000,000 per occurrence for a balloon carrying up to 10 passengers, with additional liability insurance of $100,000 for each passenger for any balloon carrying more than 10 passengers.
    3. Insurance shall apply to owned and non-owned hot-air balloons.
    4. County of Sonoma, its officers, agents and employees shall be endorsed as additional insureds for liability arising out of the operation of hot-air balloons in connection with this Permit.
    5. Required Evidence of Insurance: Certificate of Insurance issued by the aircraft liability insurance company indicating coverage satisfying requirements 4.a.– 4.d.  A certificate issued by the insurance broker is not acceptable.
      Although the Insurance Exhibit requires evidence of insurance issued by the aviation insurer rather than by the broker, we will accept broker-issued certificates.  The rationale is that the risk from broker-issued is relatively low.  Even though such certificates are not binding on the insurer, most of them accurately reflect the policy coverage.
  5. Standards for Insurance Companies
    1. 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’s 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.
  6. Documentation
    1. Operator shall submit all required Evidence of Insurance prior to the execution of this Permit. Operator agrees to maintain current Evidence of Insurance on file with County for the entire term of this Permit. 
    2. The name and address for Additional Insured Endorsements and Certificates of Insurance  is County of Sonoma, its officers, agents and employees, c/o Airport Manager, Charles M. Schulz – Sonoma County Airport, 2290 Airport Boulevard, Santa Rosa, CA 95403.
  7. Policy Obligations
    1. Operator’s indemnity and other obligations shall not be limited by the foregoing insurance requirements. 

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