Dateline: 06/12/1999
Previously Unavailable Coverage Protects Contractors Against Errors and Negligence of Subcontractors
SCHAUMBURG, IL, December 6, 1999 – Zurich U.S., a leading commercial property and casualty insurance company, today introduced a new coverage for general contractors and design-builders called Contractor’s Protective Professional Indemnity and Liability Insurance (CPPISM). The coverage is the first to indemnify contractors for losses arising from a subcontracted architect/engineer’s errors and omissions and provide standard professional liability insurance, including defense and pollution liability arising out of errors and omissions. CPPI is designed for all types of commercial construction projects.
“In design-build construction, the contractor, rather than the owner, usually hires and supervises design or architectural services,” said Richard Zarandona, vice president of the Architects & Engineers group at Zurich U.S. “As a result, the contractor takes on more liability for the subcontractor’s mistakes, which could include cost overruns, delays and re-work. Most subcontractors’ insurance is insufficient to cover significant losses in major commercial projects, leaving the contractor liable for the balance. Now, for the first time, CPPI offers the contractor a way to recover damages or losses stemming from a subcontractor’s professional negligence.”
CPPI can be written for a specific project or as an annual coverage for all of a contractor’s projects. The coverage indemnifies insureds for damages or losses in excess of their subcontractor’s available insurance or a self-insured retention (SIR), whichever is greater. The contractor can recover incurred losses regardless of whether there has been a claim by the project owner or third party, as long as the design professional is legally liable to the contractor for the loss.
“CPPI provides contractors with the insurance solution they have always needed,” continued Mr. Zarandona. “Adding this indemnity coverage to a standard professional liability policy significantly broadens a contractor’s coverage and adds an enormous comfort level. In effect, the contractor gets the benefits of two policies in one – and gets ultimate control over the project’s insurance program.”
Zurich U.S. is a leading commercial property and casualty insurance company serving the multinational, middle market and small business sectors in the U.S. Zurich U.S. is a member of the Zurich Financial Services Group, a global leader in the financial services industry.
Providing its customers with solutions in the area of financial protection and asset accumulation, the Zurich Financial Services Group concentrates its activities in four core businesses: non-life and life insurance, reinsurance and asset management. Headquartered in Zurich, Switzerland, the Group's worldwide presence builds on strong positions in its three home markets--the United States, the United Kingdom and Switzerland. It has offices in more than 60 countries reaching over 33 million customers and employing 68,000 employees.
Media contacts: Patricia Schnably
Vice President, Zurich U.S. Communications
Zurich U.S.
(847) 605-6372 (Schaumburg)
pat.schnably@zurichna.com
Joanne Lessner
Miller DeMartine Group
(212) 222-7436
jlessner@mdgpr.com
