What is an OCIP (owner-controlled insurance program)?
An
insurance program that is designed, implemented and administered by an
organization for its own use, independent of the involvement of a
contract with an insurance company. OCIPs can involve a single
coverage, such as workers compensation or product liability, or
multiple coverages. Its purpose is to protect the organization from an
acute loss exposure while saving money typically needed for insurance
premiums. Today, the term OCIP is also used to describe wrap-up
programs.
What is a wrap-up program?
One insurance
program, covering all involved interests for big construction projects,
i.e., the owner, the contractor, subcontractor, suppliers, etc., are
all covered under the same policy while working on a wrap-up program
jobsite. They typically provide general liability and workers
compensation insurance, but can include Auto and Umbrella as well.
What is an owners and contractors protective (OCP) liability policy?
A
policy which provides liability coverage for the insured for the
negligent acts of contractors and subcontractors hired by the insured.
May also cover for their own negligent supervision of the work
performed.
What is contractual liability insurance?
It
is insurance coverage to provide protection for the additional
liability exposure an insured has assumed in a contract. Only specified
contractual liability exposures are covered in standard general
liability policies for items such as leases and related types of
contracts because the assumption of such liability in a contract is not
only voluntary, but may be extensive. Contractual liability only covers
bodily injury and property damage as defined in the coverage form.
What is an indemnity agreement?
A contract agreeing to restore an injured party to the condition that was present prior to the occurrence of injury or loss.
What is an additional insured?
A
person, business, or entity other than the named insured, who is
protected by the terms of the policy. Usually a specified entity or
entities who are required to be named an additional insured within a
contract.
What is joint and several liability?
This
type of liability occurs when more than one party is involved in a
contract and where both joint liability (that of all the parties to the
contract) and several liability (that of each individual party to the
contract) promise the action in the contract. If the terms of the
contract are not fulfilled, the injured party has the ability to seek a
legal remedy from all the parties involved (joint) or each individual
party(several). In insurance, this type of contract sometimes exists
with self-insured groups, or captives.
What is railroad protective liability?
The
standard commercial general liability policy excludes liability for
construction or demolition operations on or near railroad property,
such as tracks, trestles, sidetracks, etc. In order to provide coverage
for this exposure, the railroad protective liability policy is
available to provide protective liability coverage for railroad owners,
property owners, or contracts from the vicarious acts of contractors or
subcontractors who are working on their behalf. The policy is purchased
by the subcontractor or contractor in the name of the party needing
protection. For example, a contractor demolishing a building near a
railroad track may need to purchase a railroad protective liability
policy for the property owner, the railroad, or both.
What is experience rating?
A
form of individual risk rating which takes into consideration the loss
experience of the particular risk as a credit or a debit to the manual
rate for the insured’s classification. As the size and number of
exposure units increase (e.g., a multiple location risk), more
credibility is given to the insured’s own experience. Experience rating
is typically done on Workers Compensation, Business Auto, and General
Liability.
What is a workers compensation experience modification rating factor?
It is a credit or debit factor based on a business’ loss and payroll history.
Who is eligible for workers compensation experience rating?
Employers
who average $4,000 in unmodified audit premium in Minnesota per year
during the three-year rating period or $8,000 total in the last year or
last two years of a rating period.
What is a rating period?
Generally
it is three complete years of policy data ending one year prior to the
effective date of the experience rating. Changing policy effective
dates may affect the data to be used in a rating period.
Does claim severity affect workers compensation experience mods more than claim frequency?
Generally
claim frequency has a larger impact on your mod calculation. Multiple
claims that total $10,000 will have a greater impact on your mod than a
single $10,000 loss.
Who is excluded from workers’ compensation coverage in Minnesota?
Executive
officers who hold 25% ownership in a closely held corporation with less
than 22, 880 total payroll hours for all corporate employees in the
preceding calendar year, member/owners of a limited liability company,
partners of a partnership, and sole proprietors as well as the parent,
spouse, and children of all of the excluded parties described above.
|
__________________________________________________________________________________
|
This document
contains a brief overview of coverages provided by your insurance
policy or policies. It is informational only, is not all-inclusive and
is not an insurance policy or an insurance binder. Actual coverages
afforded by any policy are controlled solely by the provisions of the
policy and not by any language contained in this document.
|
|