New insurance regulations are slated to go into effect in New York City next week, leading many insurance agents to warn contractors in the City that it may be too late to obtain increased coverage. The City’s Department of Buildings has made changes to the requirements associated with general liability coverage.
Effective June 13, insurance policies that do not cover liability for completed work, explosions, collapses and other catastrophic events will be prohibited. Several of the new regulations will make it nearly impossible for the majority of contactors in the City to obtain, according to the Independent Insurance Agents and Brokers of New York.
“Virtually every general liability insurance policy contains provisions excluding coverage for liability a business assumes under some contracts,” says Christopher Brassard, Chairman for the Agent’s group. Contractors can often obtain some type of coverage regardless of exclusions, but the new regulations mean that most policies will not meet the Department of Building’s standards.
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The Department is also mandating that insurers must submit written notice to the Department when contractors change or cancel policies.
Brassard believes that the Department is acting in the best interest of New York City taxpayers, but insists that some of the provisions outlined in the new regulations are not representative of an existing insurance marketplace. Simply put, there are not enough policies available that live up to the standards of the Department, and the majority of the City’s contactors do not qualify for the policies that are available.
The Independent Insurance Agents and Brokers of New York are encouraging city officials to find a more reasonable alternative with the help of the insurance industry.