If you have ever had an accident occur on a project you know how important it is to have insurance. It is equally important that the general and the subcontractors have insurance and that the general and owner be named as additional insureds under their policies. A provision should be placed in both the contract between the owner and the general and in the contract between the general and all subcontractors that provides that the owner and the general will be named as additional insureds on the policies. Owners generally do not want contractual provisions directly with the subcontractors but in the case of being an additional insured under their policies, it is wise to have a provision in the general’s contract with the subcontractors that states that they will name both the general and the owner as additional insureds and a provision in the contract with the general for indemnification if the subcontractor fails to do so or their is any determination by a court that such naming of the owner is invalid. The best provision would be to require a certificate of coverage be issued directly from the insurer to the owner and general contractor. The provision in the subcontractors contracts should also state that if they hire any subcontractor to perform any portion of the work called for under the contract with the general that they require such sub-subcontractor to also have insurance and name the subcontractor, owner and general as additional insured and provide such a certificate to the general contractor prior to entering into the sub-subcontract. A provision for indemnification should be placed into the subcontractors contract if he fails to do so and the general or owner is sued because of an accident by a sub-subcontractor.
However, at a minimum the general and the owner should have someone in charge of obtaining the certificates of insurance from the subcontractors and notifying the insurance companies that the owner and the general request notification of any change or cancellation or expiration of coverage.
Protecting your company is a difficult as building it, you need to have an Orange County Construction Lawyer helping you. Contact us with any questions regarding additional insured certificates.