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Supplementary Insurance Clauses

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Supplementary Insurance Clauses


Recommended Clauses


When Do They Apply?


Additional Insured. The liability insurance coverage, except Professional Liability, Errors and Omissions, or Workers’ Compensation, if included, required for performance of the Contract shall include the City of Portland, the Bureau of _____________ and its divisions, officers and employees as Additional Insured but only with respect to the Contractor’s activities to be performed under this Contract. Coverage shall be primary and non-contributory with any other insurance and self-insurance. 

  • Additional Insured provisions extend to the City defense and coverage under the Contractor’s policy, if we are blamed for something the Contractor did.
  • The City benefits by not having to use its assets for litigation purposes. 
  • The purchase of a "Blanket Additional Insured Endorsement" is another alternative to naming the City as an Additional Insured on a Contactor’s existing coverage. The Contractor’s insurer may be more willing to provide this option as it is extra coverage the Contractor must purchase.  
  • Does not apply to Professional LiabilityErrors and Omissions, or Workers’ Compensation  coverage.
  • Use in every contract requiring insurance.
  • Protects the City when named in an action that is not its responsibility or fault.

Owners and Contractors Protective Liability.  Contractor shall obtain, at Contractor’s expense, and keep in effect during the term of this Contract, Owners and Contractors Protective Liability Insurance, naming the City of Portland, the Bureau of _______________ and its divisions, officers and employees as the Named Insured. Coverage limit per occurrence shall not be less than $ __________.  Annual aggregate limit shall not be less than $ ____________.  As evidence of the coverage, the Contractor shall furnish the actual policy to the Bureau of _______________ prior to its issuance of a Notice to Proceed. 

  • Covers the City  (Named Insured) for bodily injury or property damage from vicarious liability arising out of operations performed for the City by independent contractors in connection with a specific project(s); or for the City’s own acts or omissions in connection with its "general supervision" of the contractor’s work.
  • When Owners and Contractors Protective Liability is used as an alternative to Additional Insured, CGL coverage is still required.
  • The OCP policy is purchased by the independent contractor for the Project Owner (City) to cover the City’s vicarious liability for acts attributed to the independent contractor or its employees. The policy does not provide protection for the independent contractor.
  • Coverage is limited to a specific project or contract and ends when the project is complete or the terms of the contract are fulfilled. The OCP policy is only written for one year at a time. If the length of the project is more than one year, the OCP policy would need to be renewed until the project terminates.
  • The Owners and Contractors Protective Liability coverage is a stand alone policy. The insurance provided is primary coverage. It is occurrence based; no claims made coverage is available. No deductibles apply. 
  • Alternative insurance called “wrap-up” may apply on very large construction projects ($90 million in construction costs). 


Setting Limits:   

Use Owners & Contractors Protective (OCP) Liability as an alternative to Additional Insured ONLY when the risk of loss is high AND the Contractor or its insurer refuses to name the City as Additional Insured.

Notice of Cancellation or Change.  There shall be no cancellation, material change, potential exhaustion of aggregate limits or non-renewal of insurance coverage(s) without thirty (30) days written notice from the Contractor or its insurer(s) to the Bureau of ____________.  Any failure to comply with the reporting provisions of this clause shall constitute a material breach of Contract and shall be grounds for immediate termination of this Contract.

  • Notice of Cancellation or Change provides notification to the City if the Contractor’s insurance coverage are canceled or not renewed, changes in limits of coverage and coverage terms, or if there is a possibility of the policy limits being exhausted during the contract period.
  • On rare occasions (very large or high-risk projects) the insurer needs to issue a policy endorsement that City s that the insurer will provide a notice of cancellation to the City.  Bureaus need to follow-up to obtain a copy of the policy, and assure that such an endorsement is issued.
  • Wording on the Certificate of Insurance to the effect of  “the insurer affording coverage will endeavor to mail written notice to the certificate holder named here in, but failure to mail such notice shall impose no obligation or liability of any kind upon the insurer” is becoming industry standard.  The Contractor is still ultimately responsible for notifying the City of any changes in contract requirements (including insurance).  Attempt to negotiate removal of the words “endeavor to”.  A pen and ink change initialed by all parties is also acceptable.  If the Contractor’s insurance company will not agree to this change, the Contractor should be notified in writing of their responsibility to provide notice.
  • Standard for all contracts requiring insurance.

Certificate(s) of Insurance.

  As evidence of the insurance coverage required by this Contract, the Contractor shall furnish Certificate(s) of Insurance to the Bureau of __________ prior to the award of the Contract if required by the procurement document, but in all events prior to Contractor’s commencement of work under this Contract.  The Certificate(s) will specify all of the parties who are endorsed on the policy as Additional Insured (or Loss Payees).  Insurance coverage required under this Contract shall be obtained from insurance companies acceptable to the Bureau of ______________.
The Contractor shall pay for all deductibles, self-insured retention and/or self-insurance included hereunder.
  • Requires the Contractor to provide you with proof of insurance at the beginning of the contract period and prior to the commencement of work.
  • Make sure that the coverage and policy limits match the contract requirements.
  • Look at the policy effective date and expiration dates to make sure that they coincide with the contract term. If not, request another certificate before the policy expires.
  • On most contracts, the City does not have the resources to track the ratings of Contractor’s insurers.  However, in some cases (very large or high risk projects), it is important that insurance coverage be obtained from an acceptable insurance company with a sound financial rating by AM Best of no less than “A”.   In these cases, this language should be added to the clause.
  • Certificates of Insurance are often inadequate to inform the bureau of the scope of the Exclusions from coverage.  If you are unsure if the Contractor’s insurance will cover the risks of the project, complete copies of insurance policies may be a safer method of managing the risks.
  • The certificate should read “Endorsed on the policy as Additional Insured."
  • Standard for all contracts requiring insurance.

“Tail” Coverage.

If any of the required liability insurance is on a “claims made” basis”, “tail” coverage will be required at the completion of this contract for a duration of 24 months, or the maximum time period reasonably available in the marketplace.  Contractor shall furnish certification of “tail” coverage as described or continuous “claims made” liability coverage for 24 months following Contract completion.  Continuous “claims made” coverage will be acceptable in lieu of “tail” coverage provided its retroactive date is on or before the effective date of this Contract.  If Continuous “claims made” coverage is used, Contractor shall be required to keep the coverage in effect for a duration of not less than 24 months from the end of the Contract.  This will be a condition of the final acceptance of work or services.
  • Tail coverage extends the time to report a claim, which occurred during the time the "claims made" policy was in force, but was not discovered until after the policy expired.
  • Standard for all contracts requiring insurance