Construction Material Supplier Insurance Guide CA

• Additional insured, vendorsoften CG 20 15The form written for this relationship specifically: a manufacturer naming the business that resells or distributes its product. It is commonly narrower than it first appears — vendor forms frequently exclude repackaging, relabeling, demonstration, installation and any change to the product, so a supplier that does more than warehouse and deliver may find the grant does not reach what it actually does.
• Manufacturer indemnity in the supply agreementThe promise behind the insurance, and generally worth having in writing before a claim rather than after one. Where a defect originates upstream, an indemnity that was never documented tends to leave the supplier arguing about it at the worst possible moment.
• Waiver of subrogationCG 24 04Gives up the insurer’s right to recover from the upstream party after paying a claim. Frequently named alongside additional insured status rather than instead of it.
• Evidence of the manufacturer’s products limitsA supplier’s own products exposure is frequently judged against what stands behind it. A manufacturer with thin limits, or one outside the United States and difficult to pursue, commonly changes how a supplier’s own program is built.
• Certificate, plus the endorsements behind itA certificate evidences that a policy existed on the day it was issued. It is not proof that any particular endorsement sits on that policy, which is why a requirement is commonly checked against the endorsement itself.

This is the direction suppliers most often skip. The downstream requirements usually arrive in writing from a customer; the upstream ones have to be asked for.

• Additional insured, designated partyoften CG 20 26For a business that sells and delivers rather than performs work, a designated-person-or-organization form is commonly a better fit than the ongoing-operations form a subcontract would ask for. Which form a given contract will accept is its own question, and one worth settling before the first delivery.
• Additional insured, completed operationsoften CG 20 37Covers the same party for claims arising after the work is complete — which is when a great many construction claims actually surface. A contract asking for both ongoing and completed operations is usually asking for two separate endorsements, not one.
• Products and completed operations, not ongoing operationsThe distinction that matters most on a supplier’s policy. A supplier’s claims generally arise from material already delivered and installed, which is the products and completed operations side of a general liability policy — a different aggregate from the general one, and frequently the limit a contract should be reading.
• Primary and non-contributoryoften CG 20 01Commonly decides whether the downstream policy responds first or shares with the upstream party’s own cover. Usually keyed to a written contract requiring it.
• Waiver of subrogationCG 24 04Gives up the insurer’s right to recover from the upstream party after paying a claim. Frequently named alongside additional insured status rather than instead of it.
• Auto liability for the delivery itselfDelivery puts a supplier’s driver and vehicle on somebody else’s jobsite, which is commonly the highest-frequency exposure the business has. Loading and unloading can fall on either the auto or the general liability policy depending on wording, and contracts sometimes state an auto limit separately from the liability one.
• Certificate, plus the endorsements behind itA certificate evidences that a policy existed on the day it was issued. It is not proof that any particular endorsement sits on that policy, which is why a requirement is commonly checked against the endorsement itself.

A supplier’s exposure does not end when the truck leaves. Products claims commonly surface years later, from material that performed exactly as delivered until it did not.