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Commercial Insurance Blog

Insurance Issues with Choosing a Subcontractor

Posted by Jeff Helm on Mon, Feb 26, 2018 @ 03:56 PM

As a General Contractor, one of the best ways to control costs and reduce risk is to hire qualified and vetted subcontractors for specific functions. If their trucks have "full insured and licensed" on the side they're perfect, right? Maybe.

There are a number of important questions to ask when hiring a sub, and believe it or not, price should not be the most important consideration. Some of these questions should be:

  • Do you have experience and a track record for the discipline you specialize in?
  • Will you be subbing out any of the work assigned to you?
  • Have you had any claims made against you? (Ask for Loss Runs and Workers Compensation Experience Mods)
  • Are you financially able to complete the job we're hiring you for?
  • Do you have insurance and will you provide us with a Certificate of Insurance directly from your agent or company?
  • Will you sign a contract specifying the work we are hiring you for and your responsibilities for that work? NO? Move on. YES? Don't be afraid to push for what your insurance agent tells you that you need to include.


Contractor Image-1.jpg


Now it's decision time, so let's figure this out!

YOUR CONTRACT - You must have a signed Contract with your subs that detail their and your responsibility. Be sure to include the full scope of the job so should a dispute arise it can be clearly addressed. Be sure to include all insurance requirements and don't forget to include such often overlooked items as their need to insure their own equipment .

INSURANCE COVERAGE FOR YOU AND YOUR SUBCONTRACTORS - Your subs should maintain the same limits that you do. Most jobs you are bidding on will have an "Insurance Requirements" section detailing YOUR prerequisites; these same prerequisites should be applied to all subcontractors. Typical insurance coverage that will need to be evidenced include General Liability, Business Auto, Workers Compensation and Umbrella/Excess Liability. Along with being named an Additional Insured on your sub's policies, you should demand Waiver of Subrogation, Hold Harmless clauses and strong Indemnification wording. Requesting these insurance points as part of your Contract is key because many company forms will not be "triggered" unless these agreements are in writing and executed before the time of any loss.

INSURANCE CERTIFICATES - So now you've chosen your responsible, financially sound, properly insured and vetted sub. Your final step is to secure validation of such via a Certificate of Liability Insurance.

We are often asked to provide copies of the contractor's actual policy forms and endorsements as a check that there is compliance with construction documents. You want and need to have insurance in place to pay claims for which you are ultimately responsible, and to be able to pass through these claims to subcontractors when warranted.

Call the insurance professionals at Gordon Atlantic for a deeper discussion at (781)-659-2262 or click below if you have a specific question we can answer!




Tags: workers compensation, subcontractors, independent contractor

Insurance for a Rental Property

Posted by Val Feeney on Thu, Feb 22, 2018 @ 02:22 PM



Insurance for a rental property is different than insurance for a single family primary or secondary home, primarily because a rental is exposed to inherently different risks than a primary residence.

For starters, the owner does not reside on the property so does not have an eye on the home on a day-to-day basis. Slip & falls, vandalism and theft are far more likely to occur at a non-owner occupied location versus those where the homeowner is regularly present.

Val Rental Image II 2018.jpg

Exposure to frivolous lawsuits is infinitely higher for a rental property versus a primary property. Think of a 3-unit rental property owned by the same landlord for 30 years. If the average tenant stays in a unit for three years, the landlord will have had 30 different tenants pass through his or her property. Compare this headcount to a single family homeowner who occupies one primary location for that same 30 years and you can do the math on the potential for claims.

Here are some of the factors that play a role in obtaining insurance for a rental property, and the pricing for that coverage from the insurance carrier's standpoint:

  • Year Built & Updates - newer houses will be most favorable, obviously. Older homes with full system updates (roof, electrical, plumbing and heating) completed in the last 20 years are also favorable. Older homes with little to no updates, or incomplete update information, are less attractive.
  • Claims History - properties with little to no claims in the past six years will be more favorable. Properties and/or owners with frequent or large claims within the past six years will face limited options. The owner's personal claims history on ALL owned properties will be considered in the underwriting process.
  • Location - the rental property's city and neighborhood play a factor in pricing. Certain areas of towns, cities and regions have higher crime rates than others, and you can believe that insurance companies do indeed factor in that crime data.

If a rental property checks all the right boxes with respect to those items above, there should be multiple carriers competing to write the insurance...which will results in better coverage and better pricing. If the rental property fails to check all the right boxes there may be a limited number of carriers offering policies, thus the potential for limited coverage at a higher cost.

It is important to work with an independent insurance agent who understands how the rating factors work, as well as the weight each insurance company places on said factors. Please call us at (800) 649-3252 to discuss your particular risk, or click below for help with getting a question answered or a quote on your property!




Tags: Rental Coverage, insurance coverage, risk coverage

Breaking down the experience modification worksheet in MA workers comp

Posted by Geoffrey Gordon on Wed, Jan 10, 2018 @ 12:50 PM

If your workers compensation costs are a significant factor in your labor costs, you know how important your "experience modification factor" (your "mod") is.

The workers comp experience mod is a multiplier in the calculation for how much you pay for workers compensation, where 1.00 is the mean (the average).  Over 1.00 will charge you more, and under 1.00 will be less.  For example, if a 1.00 factor generates a $5,000 workers compensation cost, then a 1.10 will take you to $5,500.  Conversely a .90 factor gets you to $4,500, much better. This has a direct effect of your labor costs relative to your peers.

How is the mod calculated?

The workers comp experience mod calculation takes your loss experience and historical cost (premium) into consideration to calculate how much above or below the median your experience places your company.  High losses, you'll pay more; fewer, smaller losses, you'll pay less.

Because we don't know the final premium and loss experience until after a policy year is over, the experience used for the calculation is from four, three and two years ago. See the chart below for a 2018 renewal as an example:

Experience modification worksheet experience

The 2017 policy year experience does NOT count for 2018, since the year is not over and the audit not completed when the renewal is calculated.  There is a one year gap for the most recent year, then a three year lookback.  One conclusion we can immediately make from this chart is that the large claim ($79,110) that occurred in 2014 will not be on next year's calculation.  We can expect the factor to drop significantly next year.

What is the difference between Actual Incurred and Actual Primary losses?

"Actual Incurred" include the losses paid, plus expected payments known as reserves, plus insurance company expenses for handling the claim.  Actual Primary are limited to the first $5,000* of each claim.  In the example above, we know that there was one big claim in 2014, limited to $5,000 'primary', plus two other small claims for a combined total of $5,653.

(* Primary losses are capped at $5,000 in Massachusetts. Most states follow a national model – NCCI – which include primary losses to $16,500.)

What are Expected Losses?

"Expected losses" are the average losses in a given class code. If a  company had losses that were the same as expected losses, they would end up with a 1.00 factor.  These expected numbers derive from published tables at the workers compensation bureau.  These are important because they make up part of the denominator – the bottom half of a fraction – in calculating the experience modification factor.

How does the fraction unfold?

For those who jump into the math behind an experience worksheet, the printed section below will look familiar.  This is how the math works.  It may look intimidating with all the letters and umbers, but can be boiled down to a few simple components.

Experience modification worksheet mod calaculation formula.png

Each of the components is broken down further in the color coded image below.  To simplify, bear in mind that the second and fourth formulas are numbers over themselves, or mathematically, 1.  Because the formula adds these, rather than multiplies them, they still matter.  But they matter less and are not numbers that we control.  Focus on the first and third calculations, B/D and (E x G) / (F x G).

Insurance pricing has two fundamental elements: frequency and severity. The first formula measures frequency, by adding up all the "primary losses"; the third measures severity, aggregating "excess losses", duly discounted (in this case by 93%).  The other components to the fraction only moderate the effects of these two (which matter).

Experience modification worksheet mod calaculation.png

The first formula includes your "Actual Primary Losses," all those under $5,000, relative to your industry's average (the "Expected Primary"). If your actual losses are higher than your peers, your factor will trend higher. If you're lower, your factor will follow.  Lower is better, because lower relative costs improve your competitive position against competitors.  This is the 'frequency' part of the insurance calculus: three $2,000 claims have a greater impact on this ratio than one $12,000 claim, which will be capped at $5,000 (primary).

The second portion is ballast (H/H): just as ballast rights a ship buffeted by strong winds, ballast in this calculation is intended to steady the fraction from one-off severe claims.  Ballast is a published number related to your "Expected Losses" - a measure of your size - for you and your peers in an industry.  

The third piece, the other important element, "Actual Excess Losses" over "Expected Excess" measures the Excess losses relative to the industry average, discounted by a statistical weighting moderator, in this case, to 7%.  (Weighting is also a published number, and also derived from Expected Losses).  Losses over the $5,000 primary limit are discounted 93% (1 - .07 = .93).  That's the good news. The bad news is that large claims, even when heavily discounted, can still have a major effect. In the example above, Excess losses ( E ) were $73,457 from one huge claim.  7% of $73,457 is still $5,142, more than another "primary" maximum loss.  Remember also, each of these count for three years.

Of note, these large paid claims often include "lost time" in addition to medical care, meaning continued wages paid by workers compensation insurance to an injured employee.  This is why "return to work" policies are so important to businesses that can re-deploy injured workers into light duty work.  Minimizing the impact of infrequent severe losses through formal 'return to work' programs eases its (3 year) impact on your future labor costs.

The final element in the fraction is another number over itself: Expected Excess over Expected Excess, both of which are industry averages, independent of a company's experience.  This has a stabilizing effect, and cannot be influenced by our or your company's efforts.

The experience worksheet may seem unimportant where losses are infrequent and below peers.  Everyone one likes a lower factor, and attention to this calculation lacks urgency when all is well.  Ultimately effective worker safety programs will help to keep losses low, and the calculation will reflect those efforts over time.

For a closer look at your experience and how you can improve it, or how the All Risk Adjustment Program (the ARAP Factor) is an accelerant on these calcuations, or other aspects of your workers compensation program, contact the risk and insurance professionals at Gordon Atlantic Insurance.

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Tags: experience mod, experience modification factor, mod, workers comp experience calculation

Claims made – Prior Acts and Tail Coverage

Posted by Geoffrey Gordon on Mon, Aug 21, 2017 @ 11:52 AM

Claims made policies have distinct limitations on occurrences that happened before the policy's inception (starting date), and after policy coverage ends.   Prior acts are events that happened before a policy was in place, and "Tail" is the term for after the policy ends.  This blog will discuss how each of these work.

Prior Acts

Prior acts occurred before a policy went into effect. If a claims-made policy is issued on January 1 of this year, the policy will not provide coverage for anything that happened in December of last year or earlier. The timeline below shows graphically how this works. An exception is when there had been prior insurance coverage and an earlier date (retro date) acknowledged specifically in the policy.

Priority Acts Gordon Altantic Insurance Norwell, MA

Retro Date

The retro date is the first day an "occurrence" will be covered if a claim is brought later. The earliest is usually the first day of the first policy. This inception date will become the retro-date for the policy, and usually remains on future policies.  Thus, if your first policy was written on January 1, 2015, that date will appear on future policies as the acknowledged "retro date."

Occasionally "Full Prior Acts" option is offered, meaning there is no limitation of protection for some event (tort) that happened previously. Carriers will do this when policies have been in effect for a period that generally exceeds normal discovery periods. For example, our office has had Errors and Omission insurance for over 40 years. We now have "full prior acts" E&O protection. 

Tail coverage

Tail coverage refers to insurance that is purchased after a business stops buying current coverage, but wants protection for those 'incurred but not reported' (IBNR) claims: the ones that are out there that we just don't know about yet.

In the table below, the professional decides to sell her business on December 31st, but it's an "asset sale" meaning the buyer is buying only the assets, not the company through a stock purchase or, in other words, the liabilities.  Before the sale goes through, in October in this example, a "wrongful act" has been committed (or alleged); but it's simmering.  The aggrieved party is talking to his lawyer about suing the professional and they're quietly working through their legal strategy.  After the professional retires, there is no further professional work, so no need to continue insurance, right?   Not so fast.  She needs tail coverage for the lawsuit that gets filed, in March in this example.

tail coverage Gordon Atlantic Insurance Norwell, MA

This coverage is customarily secured by professional service businesses when they close. As in the example, the professional may need protection for work that was done where a claim was brewing, but we're not aware of ...yet.  Rather than continue to buy liability insurance after closing the business, the professional can buy this limited "tail" coverage.

This is usually available contractually, meaning the policy outlines specific options, and can usually be purchased for various lengths of time, most commonly one, three, five and 10 years.

Always work with a professional when considering these specialized terms.  For more on the many differences between "claims made" options, view or comparison chart HERE.

Still not sure about a claims made policy?  Read our blog, "Claims Made Versus Occurrence Liability Form."

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Tags: retro date, tail insurance coverage, claims made insurance, prior acts

Claims Made Versus Occurrence Liability Form

Posted by Geoffrey Gordon on Wed, Aug 16, 2017 @ 02:48 PM

A "claims made" policy treats the timing of a claim differently than the more commonly seen "occurrence" policy.

Here's how it works.

Suppose you have a policy that runs from January 1 to January 1. In November of the current policy year someone at your building slips on the steps, falls down and hurts themselves. You don't hear about it…until sometime the following spring when the demand from the injured person's lawyer reaches you. In this example the fall, meaning the actual "occurrence" that prompted the claim, happened in the first policy year, but the claim was filed in the second policy year. The more traditional "occurrence" policy would have the policy that was in effect when the incident happened defend the claim. A "claims made" policy would have the second policy term respond to the incident as this is when the lawsuit was actually made.

claims made versus occurance liability


This newer approach was developed in response to lengthy time lags between claims occurring and insurance companies learning about them. This reached a crisis point in the 1970s with the explosion of asbestos and similar industrial or pollution related claims. When lawsuits drained policy limits, policy language gave access to previous years' policies as well. These piled-on claims were never contemplated in the pricing of the insurance; the industry needed a way to close the books on certain types of long tail liability. The solution was what we now call the "claims made" policy.

Insurance companies prefer "claims made" policies so as to close their books on liabilities that have occurred but nobody knows about yet. These policies are most common with Professional Liability, some Products Liability, Employment Practices, Directors & Officers, and other specialty lines, particularly those with long "tails" or discovery periods. Read our blog describing tail coverage and prior acts HERE.

There are many other factors that characterize these highly specialized policies; customizing a policy to meet your specific needs should not be taken lightly. Some of those features are highlighted on this comparison sheet.

To further discuss the ramifications of policy types and how they may impact your business, please contact the professionals at Gordon Atlantic Insurance at (781) 659-2262.  Questions?  Click the link below:



Tags: insurance, malpractice, professional liability, occurrence form, retro date, tail coverage, E&O

Excluding Sub-Contractors from General Liability

Posted by Geoffrey Gordon on Tue, Aug 08, 2017 @ 03:29 PM

Excluding Sub-Contractors from General LiabilityWe have noticed a trend in our office for general liability policies to add an endorsement that excludes coverage for the acts of subcontractors. Because this is a deviation from traditional language, this change can create a problem and needs to be addressed.

The purpose of adding this endorsement is clear: lower costs to the carriers. Within any contracting operation, if a sub-contractor's actions prompt some kind of lawsuit the general contractor will almost always be included as a defendant...that's just how it works. When those suits arising from the lower level of sub-contracting operations can't reach the general contractor's insurance, it will cost less. We recommend that contractors hiring other contractors include an agreement whereby the subcontractor names the contractor as an Additional Insured. The purpose of this is to ensure that the insurance for the offending party defends both. Read our blog that outlines the importance of additional insured status in any contracting operation.

Many insurance underwriters providing coverage to general contractors will require that these agreements are in place, and that additional insured status is documented before providing coverage.

Contractors and subcontractors insurance Norwell MA

The latest iteration of this trend is a Commercial General Liability policy excluding coverage for the actions of subcontractors within the language of the policy itself. In short, it puts teeth into the requirement that each party has their own insurance to protect others from their actions.
If the insurance and the Additional Insured status are buttoned up tightly, this exclusion should not, in theory, pose a problem to a general contractor. However, everyone in the construction business knows that managing subcontractors is a complicated affair fraught with unknowns. For example, if a plumber, electrician, or other tradesman brings in their own subcontractors to meet deadlines or trade specialties, is it reasonable for the general contractor to have to police these guys as well? A lot of the work that actually gets done on a building or renovation site is arranged with longstanding informal relationships that may or may not have written agreements outlining what happens when somebody gets hurt. If the plumber's cousin, whose insurance cancelled last year because he was mostly working for someone else, causes damage or an event where someone is hurt, the lawsuit will go to the next level up. If the plumber and general contractor purchased lower-cost insurance with a subcontractor exclusion, we have an uninsured event.

What can a contractor do?

Have good legal counsel draft a subcontractor agreement to be used whenever hiring someone else. At a minimum, such agreements should have these features:
  • Hold harmless and indemnification agreements, creating separation between entities
  • Requirement to name the hiring contractor as an additional insured
  • A requirement for subcontractors to hold their subcontractors (the cousin, in our example above) to the same standards outlined in the agreement
  • Required notice by the subcontractor to alert the hiring contractor if their insurance terminates
  • Statements that the insurance is primary and noncontributory
  • Any agreements include specific limits of insurance, with $1 million per occurrence and $2 million aggregate, including products and completed operations. Higher limits are common with larger companies.
  • Once executed, get insurance certificates documenting the carrier name, policy expiration dates and issuing agency
  • Keep all certificates on file based on expiring insurance policy dates

If you have a question one of our insurance professionals can answer, please click the link below or call us at (781) 659-2262.



Tags: Additional Insured, subcontractors

Water Flow Detection Systems

Posted by Geoffrey Gordon on Wed, Aug 02, 2017 @ 04:05 PM


Water flow detection systems, or little devices that monitor when water is escaping into a home or building when no one is inside, have become one of the latest gadgets for homeowners who have or may experience water leakage in their homes or condos.

You may be thinking a water flow detection system would be overkill for monitoring things going on at home. However, considering the high cost of repairing a home, apartment, or condominium with water damage, purchasing these little devices may be justified.  

The greatest economic justification for water detection systems is in multi-story condominium or apartment building.  A broken water pipe or running water while someone is away always makes its way downhill, as is, downstairs.  Thus, a leak on the third or fourth floor will almost inevitably cause damage to units on the first and second floors.  Water damage can be incredibly expensive to repair, requiring new flooring, drywall and mold prevention, and often includes damage to other property, too. Lengthy repairs can also mean staying elsewhere while repair work is done. 

There are several different variations of flow detection systems to choose from; most good ones require installation by a qualified plumber.  When properly installed and set up these little devices can alert you or your building maintenance contacts that water is flowing without the interruptions characteristic of normal use.  Once the device is alerted it sends a notification to one or many mobile devices.

Because the winter of 2015 was such a destructive season, insurance companies are now applying deductibles to each unit owner as a means of alleviating their risk.   A trend we are now seeing in condominium insurance is these "per unit deductibles" applied to a water damage loss and other specifically listed events such as wind or ice damage.  Thus water damage isn't just a problem for the association as a whole: in many condo complexes, and especially those that had losses in 2015, it is now a problem for individual unit owners, as well.  Now more than ever, taking proper precautions to reduce the chance of water damage may be money well spent.

To discuss water flow detection systems or to find out more about risk management for your home or building, contact Gordon Atlantic HERE or call us at (781) 659-2262.  You can also get a quote by clicking below:


Tags: Water damage, condominium, home maintenance, Water Flow Detection Systems

Can Changing Your Legal Entity Status Affect Your Insurance?

Posted by Geoffrey Gordon on Fri, Jul 28, 2017 @ 11:16 AM

Know how your legal entity status affects your commercial business insurance policy with andrew gordon incChanging the legal entity type of your business can affect your insurance but changes affect different lines differently.  For most kinds of insurance, carriers will usually change the “named insured”  based on a request from the customer, provided there are no material changes in the scope of the operation.  If there are changes in the operation, such as change in management, ownership, or strategic direction, then a new policy is usually underwritten and re-written. 

Worker's Compensation is one kind of insurance greatly affected however. A change from proprietorship to corporation, or corporation to LLC, will result in material changes to this particular insurance line as the premium charged is a direct function of payroll.  In particular, owners’ payroll is fixed statutorily and differs for proprietorship, corporations, LLC's and partnerships. 

Because the payroll amount of compensation in a corporation can be managed through distributions, deductions to qualified plans and other accounting practices, Worker's Compensation assigns a minimum payroll of $10,400 and maximum of $52,000 annually for officers (with >25% ownership). Thus a corporate officer taking no payroll (and living only on distributions) will still be charged as though his or her payroll was $10,400.  Conversely, a corporate officer making $500,000 a year is capped at $52,000. Although included officers are automatically subject to this payroll floor and ceiling, owners with 25% or greater ownership may opt out. The opt out form is linked here.

Proprietorship is different. Unlike corporations where corporate officers are included by default, proprietorship excludes owners by default. As with the option of corporate officer opt-out, proprietors may opt in. When this is the case, their payroll is statutorily set at $47,000 (as of October 2017 and subject to change). Partners in partnerships and members in LLC's are treated the same as proprietors for Worker's Compensation purposes; they are excluded by default but may opt in.

Why opt in? The most important reason is you’re covered! If you get hurt at work the policy will pay medical expenses and lost wages. Why opt out? To keep workers compensation costs low.

Some contractors will require that their subcontractors include workers comp insurance on the owners. The purpose is to prevent payments to these contractors from being charged to the general contractor’s payroll. To make the distinction clear, certificates of workers compensation insurance usually state in the comments section whether owners are included or excluded.  

Businesses are dynamic and changes to corporate structure are one of many changes that businesses experience. If you are contemplating a change in business entity structure have your attorney and your insurance agent or risk partner collaborate or on how this might affect your risk and insurance program. Or contact us for customized solutions.


Geoff Gordon

Tags: commercial, comp, workers, compensation, legal, insurance, Business, proprietorship, entity, status

Reputation Management and Brand Control

Posted by Geoffrey Gordon on Fri, Jul 21, 2017 @ 11:59 AM


We recently heard from a customer of ours who had endured a terrible, terrible event happen at their company. Naturally we cannot share any details, but suffice to say that it was the sort of event that newspaper reporters love to cover and can cause tremendous harm to a company's brand. That fact that management has a well communicated policy prohibiting what happened, and was entirely unaware of the activity until that time everyone learned about it, is immaterial. This stuff sells newspapers and today, internet eyeballs, and a story like this can deeply tarnish a longstanding, well crafted brand. 

So a really bad event this happens at your company, what's the first thing you do?

First, understand the press, because they will want to know all the details.  Remember that reporters have a job to do, and that includes seeking multiple sources to find and research and  tell a story that sells.  Your job is to help them do their job in a fashion that is not harmful to your company's brand. 

To ensure a consistent and controlled message, a single spokesperson should be named immediately to handle all inquiries from the press.  A corollary to this is that other people within the organization should be immediately, clearly, consistently, and repeatedly directed, that only the named spokesperson should talk to the press. Any good reporter will try to contact other people; expect this and do your best to limit leakage and disparate messaging by consistently and repeatedly reminding employees who talks to the press.

A reporter can ask your spokesperson any question, and the spokesperson can answer with any answer.  Here are the most important answers to questions about the company's being in the news:

  1. We have had an incident involving… (be genuine, but non-specific when privacy or brand quality is a factor).
  2. The incident is under investigation, and we are cooperating fully with the appropriate authorities.
  3. We don't have all the facts and details, but will let you know when we know more.

If this sounds familiar from soundbites you've seen on the 6 o'clock news, it is because this is the gold standard response to show that you are a good community citizen, you are taking action, you are cordial to the press, ..without revealing any more details than necessary.

Never say "No Comment", and Never Lie.  The first says "guilty", and the second never ends well.

Whenever possible use one of the above statements for answers on follow-up questions that will come from reporters.  Use different words if needed, to say the same thing.  For example instead of "we don't have all the facts and details", you can say, "we just don't know enough about that yet".  Don't be blatant with stonewalling, but control the information flow.

As quickly as possible, and certainly after the first onslaught of reporters and cameras, hire a PR professional.  Let a professional guide the flow for you.  Some insurance carriers include "Image Restoration" coverage to pick up the expense of a professional public relations person.

Soon enough, another story will grab the attention of reporters, and you can get back to rebuilding your business reputation through the traditional means you've always used.

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Tags: management, media, press, news, reporting, reputation

Volunteers in Insurance Programs

Posted by Geoffrey Gordon on Fri, Mar 17, 2017 @ 01:14 PM

How volunteers are handled differs with different types of insurance. The general liability policy does include protection for the actions of volunteers; Worker's Compensation on the other hand does not include volunteers.

 In the standard general liability policy, which most businesses use commonly, names volunteers under the definition of who is an insured? Who is an insured is important, because it names who the insurance company will defend against a lawsuit or other legal action.  Volunteers are specifically listed in the most commonly used General Liability language. 

Worker's Compensation is more nuanced, but seems to have been well established by the courts. Coverage begins with the definition in Massachusetts laws: chapter 152 is the Massachusetts law that addresses Worker's Compensation definitions and other features.  Section 4 of that law defines employees as those persons under contract or higher, with exceptions for certain categories such as real estate agents, consumer products sales people, cab drivers, and others specifically excluded.  Clarifying further the "contract for hire" section, in Lowery v. Klemm, 446 Mass 572, 580 (2006), 

the Massachusetts Supreme Court wrote that "Worker's Compensation statute does not apply to volunteers... "

This volunteers appear not to be considered employees. 

Coverage for those ordinarily excluded as mentioned above, such as real estate agents, cabdrivers, and consumer products sales people, is available with a specific endorsement, but this does not apply to volunteers.

These categories notwithstanding it's easy to get conflicting interpretations from the state. The Department of Health and Human Services posts an on-line brochure stating that volunteers do have Workers Compensation coverage, but the Department of Industrial Accidents and the Worker's Compensation bureau disagree.  Given that the departments that oversee Worker's Comp directly are on the ‘no coverage’ side of this equation, we expect claims made by volunteers would not be honored.

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Tags: Volunteers

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