April 22, 2019 Articles

Battle of the Forms: Construction Contract Versus Insurance Policy

Common ways that insurers limit the scope of coverage by referencing only what is required

by Ellen M. Chapelle

While construction contracts (and subcontracts) generally include specific requirements for insurance coverage that the contractor or subcontractor agrees to maintain, the contract may not specifically require all of the bells and whistles that are part of the insurance program purchased by the contractor or subcontractor. Insurers are increasingly engaging in a version of the “battle of the forms” by writing policies to limit their coverage to what is required in the construction contract. That means, in entering into contracts with insurance specifications, your client gets only what it asks for. Should it matter if the contractor maintains higher limits or has broader coverage than required by the construction contract? It may. This article identifies some common ways that insurers limit the scope of coverage by referencing only what is required in the construction contract’s insurance specifications.

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