Well, my liability ppolicy came up for renewal recently. I had been paying $1300.00 (+-) for 1 million/2 million.
I get a letter from both my “agent” (broker) and ins.co. NOVA. Limits to be halved 500k/1million, premium will drop about $200.00. Nova is no longer providing 1/2 mill coverage. Problem is that I need 1/2 to maintain Home Improvement Contractors License here in Westchester, NY.
Broker sends me some forms to fill out to apply for supplemental or replacement coverage. About a week and a half later I get a very short letter from them saying they can replace my 1/2 policy for $6200.00, please send a check for……..
WHAT?? Oh, thats only a 377% increase. I’ve been in buss. around 25 years, good track record except for the time someone sued me because their house got broken into and robbed after I had locked up and left. My insurance (Nationwide) would not cover it and they lost in court. This has nothing to do with my increase. I’ve seen this coming I guess, especially after my agent of ten years decided to call it quits a few years ago citing so much turmoil within the industry. And that was BEFORE 911!
I’ve always had good coverage with well known companys until the last few years. My former agent told me that no one wants to write liability (contractor) especially in NY. Apparently from what I have been reading, some of it has to do with a so called scaffold law, something about the risks of insuring companies who perform work at heights and or use scaffolding? Any one know more about this?
I’ve always been covered as ‘interior carpentry’ wich means that most of my work is inside, not outside on ladders or roofs although that was not an exclusion. The most recent questionaires I filled out you would think that I was applying to transport Nuclear waste!
I haven’t looked deeply into solving this, I know I need to get a real agent, not the a hole broker that lured me in with his nice advertisement. I expecting big difficulties though. If I apply this increase along with the increase in the price of fuel to my hourly rate I will need to raise it by $3.68. I feel like I am pushing it now when I try to bill at $45.00 and I am growing weary of trying to sell myself to people who I think should know better and I know for sure can afford my rates. I have a tendency to sometimes want to let new prospects shoot them selves in the foot by hiring “that nice man” who so and so used and only charged $x and what a botch job he did!
So what would you do in my shoes. It’s just me, sometimes my son as a helper. Small business, mostly kitchens and baths, window, doors and occasional whatever.
Anyone from NY (or elsewhere?)here, and experiencing this kind of rate increase?? If you are from NY perhaps you can tip me off as to who is writing your policy.
I’m close to wanting to throw in the towel, but I like what I do and I’m not a quitter.
Thanks for your input.
Eric
Edited 6/26/2004 5:18 pm ET by firebird
Replies
Three choices.
Quit and go on welfare.
Duck and go underground and live in fear.
Shop around for the best policy to fit y9our business and pass on the cost to the customers.
You define your life by the choices you make
Welcome to the
Taunton University of Knowledge FHB Campus at Breaktime.
where ...
Excellence is its own reward!
BTW, this cost must be actuarily adjusted according to the state laws locally, I'm sure. I had heard several stories lately aboiut liability raises of up to 6-700% so I asked my agent who saidto expect maybe a 20-30% increase. She was right on.
My cost for up to three million with a thousand of deductable is about 2% of gross, les subs who have coerage papers.
Welcome to the
Taunton University of Knowledge FHB Campus at Breaktime.
where ...
Excellence is its own reward!
Thanks Piff, could you please explain what this means;
>>BTW, this cost must be actuarily adjusted according to the state laws locally, I'm sure.
I've noticed that your responses of late are quite succint, and often end with or include a pertinent self authored quote or quip. Have you had a change of life, or are you simply cutting to the chase to manage you time?
A friend of mine used to repeat the phrase, "this ain't no dress rehearsal!"
Eric
Every once in a while, something goes right!
"Thanks Piff, could you please explain what this means;
>>BTW, this cost must be actuarily adjusted according to the state laws locally, I'm sure."
Mosat states require that when insurance companies raise costs, they must justify those costs by comparisson to what is called actuarial tables. There can be variables and assumed values in parts of those tables, but rate increaases need to be connected to some realistic exzpectation of future or historical record of past increases in payout claims. The details of how these work out is different in the various states.
You are right, my time here is becoming less so my replies more succinct.
Welcome to the Taunton University of Knowledge FHB Campus at Breaktime. where ... Excellence is its own reward!
yeah, thanks Piffin, I actually got that after reading one of the articles that I posted.
Thanks for your time,
EricEvery once in a while, something goes right!
I've had to shop around, and finally found a good agent. He was able to get me in with Grange Mutual, who specializes in contractor's insurance. They're apparently picky, and he had to sweet talk me in to the program. Anyway, I've got 1/2 coverage like you need for about 3K. That's in CT.
Andy
Arguing with a Breaktimer is like mud-wrestling a pig -- Sooner or later you find out the pig loves it.
Andy,
I thinks that's National Grange Mutual or something like that, I had them up until my agent called it quits, he was having trouble keeping contractors with them.
Just what is a GOOD contractor to these companies??
3k I could swallow, my agent sucks, I knew it within weeks of hooking up with them, I should have moved on right away but had other things going on.
BTW, DW and I are probably riding up to Kent this morning, hard to say what time we'll get there though. 11-12ish my best guess. I'm on an orange Specialized, she's on a blue and white Ciocc. I've been meaning to send you some of our routes. We did a lot of hills last w/e up and over the Birch Hill/Quaker Hill area from NY22 and CT 39.
There is a new bike shop opening in Pawling, NY. Nice people, I wish them luck.
EricEvery once in a while, something goes right!
I had National Grange Mutual, until they cancelled my policy w/out any advance notice. They are extremely picky when it comes to insuring contractotors, I'm now with Western World, who seem more agreeable.Renaissance RestorationsVictorian Home Restoration Serviceshttp://www.renaissancerestorations.com
Hope you had a good ride, Eric. I was off my bike most of last week, except Sunday when I did 43 miles with some friends. I got back on yesterday and rode my regular 16 mile route. Email me this week -- Maybe we can get a ride together next weekend?
AndyArguing with a Breaktimer is like mud-wrestling a pig -- Sooner or later you find out the pig loves it.
Andy,
Your message just showed up with a date of June 28.
Guess it was floating around somewhere.
Had a great ride up to Kent and back except for the part where the guy in the pick up from Th_m_s Cabinets tried to kill my wife and I. Still gotta look him up. Maybe you know him?
There is a new shop in Pawling doing a group ride weds. at 6;30, they run up through Kent and Bulls Bridge area.
We're going to the Catskills for a coupla days next week, have some nice routes planned. If you've never ridden there it is awesome! Staying in New Paltz.
I'll try to hook up with you when we get back.
EricEvery once in a while, something goes right!
>>Don't sweat covering your costs, the price of a legitimate professional is not cheap and you must pass these costs on to the public.
Yeah, I'll try. Ouch, 6 grand. Bro I'm scraping the bugket as it is. I'll have to deal withit though.
Where are you in NY, Gary? I thought perhaps your agent could be of help to me, that is if we live anywhere near each other.
Thanks,
Eric
So no ones heard of this scaffold law thing?
I'll have to look into it more. From what I've read this is part of what is making the liability rates so high.
Thanks for the thoughts.
Eric
Eric,
Check your e-mail."Don't take life too seriously, you are not getting out of it alive"
Just for interest I did a google on -new york scaffold law contractor insurance-
All kinds of interesting articles.
Thanks Bill,
I have not gotten to that yet, and then to start writing my lawmakers in Albany, like it's gonna do any good!
EricEvery once in a while, something goes right!
Well,
It didn't take a whole lotta lookin' to find a whole lotta info...........vvveeerryyyy interesting!
N.Y. Contractors Battle 'Scaffolding Law'
BY ROBERT P. MADER
Of CONTRACTOR’s staff
NEW YORK — Only in New York state can a contractor’s employee be dead drunk or high on drugs, fall off a scaffolding or ladder and sue his employer to collect damages. Under New York’s notorious Labor Law 240, it’s not a question whether a contractor will pay, it’s only a question of how much. The law puts absolute liability on the contractor, no matter what the circumstances.
Fortunately for contractors, cracks are beginning to appear in 240. The reforms are being spurred by an insurance crisis.
“Some insurance companies won’t write for contractors in New York state because of this law,†said Mark Whalen, executive director of the New York State Plumbing-Heating-Cooling Contractors.
“Liability insurance rates are out of sight,†added Louis J. Coletti, president and CEO of the Building Trades Employers Association, headquartered in Manhattan. “Premium increases have been ranging from as low as 75% to as high as 360% for contractors in New York City.â€
The crisis centers around the issues of affordability and availability. Many contractors in Coletti’s organization responded to a survey that they could only obtain policies from insurance companies not regulated by the state of New York. Many large carriers will not cover contractors in New York City.
That’s absolutely the case, said Bernie Burdeau, representing the New York Insurance Association. Any contractor that deals with scaffolding such as roofers, painters or masonry contractors will have a hard time getting insurance, he said.
Mainstream insurance companies have suffered huge losses on premiums but can’t increase rates.
“The way it works is if you want to increase premiums by more than 7%, the rates for most companies are subject to prior approval of the insurance department,†Burdeau explained. “If the department only approves a 10% to 12% rate increase, it’s sayonara. That’s why contractors see huge increases because they’re forced into the unregulated market, the excess and surplus lines market.â€
Those premiums have escalated to the point where they hamper economic growth and threaten jobs — 12% to 15% of total job cost, Coletti said.
The soaring costs are being passed onto consumers in the form of higher prices for new construction, renovation and repairs. Even homeowners who hire contractors to do work on their dwellings are liable.
Reformers face a formidable combination of trial lawyers and labor unions in Albany so they are trying to reform the law without repealing it. The proposed legislation is Senate Bill S01710 and companion Assembly Bill A7213.
“The bill up there now in Albany does not lift absolute liability but says that when damages are decided that the employee contribution to the accident can be considered when determining damages,†Whalen noted. “We felt that had a better chance of passing the legislature than rolling back absolute liability.â€
The language of the proposed law states that the conduct of the claimant or decedent will not bar recovery, but the amount of damages recoverable will be affected by the commission of a criminal act, impairment from drugs or alcohol, failure to use safety devices or failure to comply with practices that are taught in safety training classes. Coletti’s members in the BTEA have spent $40 million on safety training, he said.
“The employer could have said, ‘Don’t use this ladder, it’s broken,’ and the guy uses it anyway,†Whalen said “That could be taken into consideration.â€
Surprisingly, that couldn’t be taken into consideration under Labor Law 240. Contractors have no right to present evidence to a jury.
Contractors, however, have made headway, Coletti said.
“We made significant progress this year because a large contractor might find a way to absorb these high premiums, but if you’re a small- or mid-size contractor, especially a minority or woman-owned firm, these premiums will bankrupt you,†he said “The problem is completely out of hand this year.
“I think this next session [of the legislature] a number of people are listening who, in the past, were not inclined to do so. There seems to be an environment in Albany where tort reform is a major item of discussion. People are fed up all across the board.â€
Meanwhile, a New York City law firm has won an unusual case — the right to present evidence to a jury in a Labor Law 240 case.
The case, Meade v. Rock-McGraw Inc. et al, centered on a journeyman carpenter injured while replacing ceiling tiles in the hallway closet of a Midtown office building. Attorney William J. Smith of Lifflander, Reich & Smith convinced a judge that the only reason why the worker was injured was 100% his own fault. The judge agreed and said the evidence should be presented to a jury.
According to court papers, the carpenter determined that a 6-ft. ladder he had been using was too big, and he retrieved a 5-ft., wooden A-frame ladder that he said was in good working order. The carpenter positioned the ladder against the closet wall in the closed position and climbed to the third step, took both hands off the ladder and began to work when the ladder slid out from under him and he fell to the floor and sustained injury, according to the court papers.
“We were able to successfully argue first at the trial court level (Manhattan Supreme Court) and then at the appellate level (First Department, Appellate Division) that [the carpenter’s] misuse of the ladder by leaning it against the wall constituted the sole proximate cause of his injuries,†Smith said.
The decision was so rare that the New York Law Journal ran it June 13 as its featured “Decision of the Day.â€
Every once in a while, something goes right!
And more...............
N.Y. Assembly Committee Forced to Vote on 'Scaffold Law' Reform Sought by Employers and Insurers
May 21, 2004
Chances there will be a vote on a key New York tort reform bill have improved after the Democratic sponsor of the bill has made a procedural move that will prompt the Assembly Labor Committee to consider his bill to reform the state's notorious "Scaffold Law."
Assemblyman Joseph Morelle (D-Rochester) asked the Labor Committee to consider his bill, a move that essentially forces the committee to vote on it before the end of the legislative session.
The chair of the Assembly Labor Committee, Susan John (D-Rochester), asked Morelle to withdraw his motion, but he declined, Assemblyman Morelle told the New York Sun.
He told the Sun he was forcing the vote "because that's what you get elected to do." He added: "I think it's important enough. . . . In the Rochester area in particular, literally hundreds of jobs are at risk."
Employers and the insurance industry back the bill, which is sponsored in the Senate by Senator Dale Volker (D-Erie County).
The bill would reform sections 240 and 241 of the state's Labor Law, the notorious "Scaffold Law" This law makes owners, contractors, and subcontractors absolutely liable for worksite injuries regardless of worksite safety programs, employee negligence, or any other factors in the injury. The law has been interpreted to pertain to any "gravity-related" worksite injury. No other state imposes such an absolute-liability standard in these cases.
Morelle's bill (A.7213/S.1710) would change the absolute liability standard to one of contributory negligence for employers that provide appropriate safety training and equipment.
The Business Council and its affiliate, the Construction Industry Council, have long sought such a reform.
"This bill would introduce a simple element of fairness into these cases: It would permit defendants to defend themselves," said Business Council President Daniel B. Walsh.
Contractors and insurers say the law in the last five years has driven insurances costs up, in some cases by a factor of 10. In fact, some contractors, especially upstate, have reported being unable to get general liability insurance at any cost because of this law, Walsh added.
Every once in a while, something goes right!
Edited 6/27/2004 3:10 pm ET by firebird
So, it's a New York thing. The one article even closely quoted the amount of my increase which has been proposed at 377%.
Ah, NY, ya gotta love it. I understand that New York is losing jobs, people and companies faster than any other state in the nation.
If I recall correctly, I believe that we have more lawyers/per person than any other state also.
Coincidence?? It'll just be a matter of time then before the lawyers won't have anyone left to lawyer to!!
Eric
Who says 'I Love NY'?
Every once in a while, something goes right!
Edited 6/27/2004 7:33 pm ET by firebird
Here's one for ya.
I was paying a couple hundred a month for liability ins. and, without my knowing it, my liabililty carrier went belly up. I was making monthly payments for around 8 mos. after they shut down.
Well, when I went to get new coverage, everybody says we can't cover you cause you had a lapse in coverage in the last 2 or 3 or whatever years. On top of that, if I could find someone to cover me I'd be looking at a minimum of 25k a year. How's that lookin next to your 377% increase?
Aaaaaaand I'm still fightin to get my 8 mos. payments back.
phil...sme thing happened to me about 15 years ago... liability ins. co.went belly up...
your agent has some liability in your case. what do they have to say ?Mike Smith Rhode Island : Design / Build / Repair / Restore
I can't believe you are only getting $45 per hour for work around Westchester. Thats what I get around central Ct. When I go down along the "gold coast" I charge significantly more and I get the feeling a lot of times that I am the low ball.
The traffic alone will add 2 hours to a normal work day.
Yeah,
45 is about covering my but right now.
I have some good clients though, not pain in the azz new money types, like the county is becoming full of. I'd have to get double for dealing with that. I'm low key, secure and honest, not showy and not real fast. I get the job done right the first ime and fix things later with no problem if it needs a little tweeking down the road.
I should charge more. I'm too lazy to put myself together in the kind of package that I would need to present.
EricEvery once in a while, something goes right!
Well, good luck to you
You gotta be the least expensive guy in the county. The only reason I go to work is for the money. After all is said and done about a nice job well done and the satisfaction that goes with it, its still for the money.
Liability is out of sight,
like many we have seen an increase of over 400%
however now the new kicker for us
we have liabilty insurance but was given notice again
because the new insurance company does not want to insure paper contractors
paper copntractor ?
let me back up a bit
we are a small company. 4 employees. CPA advised me years ago to save money run employees through temp agency to handl all paperwork, workers comp, taxes, med insurance paid holidays etc, and it really did save me money. Plus gave the employees beneifits I could notnot.I dop not pay temp wages, one guy has been with me over 5 years, I send new emplyees there, dont rely on the temp agency to find them.
Now liability insurance, same insurance company for past 9 years, no claims, no late payments, no problems.
that company decides to drops all contractors at renewal
new company rates are about 400% higher and had to go to many to find it at that affordable
new agency is dropping me because I am a paper contractor. Or as they say more then half of my payroll is to subcontractors
because the temp service is a classified a sub contractor
since more then half of my income is to subs, I therfroe am not in control of my projects
thus a paper contractor and thus dont want to insure me
I have 60 days to find new insurance and it took nearly 60 days to find this one
So what's causing the problem in your state??
Did you read the articles about the scaffold law that I posted?
EricEvery once in a while, something goes right!