PREVIOUS
22 CAR § 112-319. Contractor’s insurance requirements
22 CAR § 112-319. Contractor’s insurance requirements.
(a)(1) Dollar amounts and types of coverage limits for all insurance policies shall be set by the department.
(2) Deviations from the types of insurance and amounts set less than what is stated below shall be documented by the department and maintained in the Construction Section project file.
(3) Before a department enters into a contract for the construction or alteration of facilities or repairs to existing buildings, grounds, or facilities, it shall ensure that the contractor has complied by showing proof that the following insurance requirements have been met.
(b) The contractor shall purchase and maintain such insurance as will protect him or her from claims set forth which may arise out of or result from the contractor’s operations under the contract, whether such operations be by himself or herself or by anyone directly or indirectly employed by any of them, or by anyone for whose acts they may be liable.
(c) Builder’s risk insurance.
(1) The contractor shall procure and maintain during the term of contract builder’s risk insurance or installation floater insurance, and any extended coverage which shall cover damage for capital improvement projects.
(2) Perils to be insured are fire, lightning, vandalism, malicious mischief, explosion, riot and civil commotion, smoke, sprinkler leakage, water damage, windstorm, hail, and property theft on the insurable portion of the project on a one-hundred-percent completed value basis against damage to the equipment, structures, or materials.
(3) Exception. Contract documents which do not require coverage based upon inapplicable coverage (such as civil engineering projects, demolition, or abatement work).
(d) General requirements.
(1) While it is not a requirement, it is recommended departments accept policies issued by an insurer which has a claims paying ability rating of not less than “B+” or better as to claims paying ability by A.M. Best or not less than “A” by Standard and Poors rating service, or has an equivalent rating as established by one (1) other nationally recognized statistical rating organization satisfactory to the department.
(2) All policies shall contain a waiver of subrogation against the owner, owner’s lenders (“lender”), and any designate agent of the representative of the owner (“owner’s agent”).
(e) Cancellation/notification provisions. Each insurance policy shall contain a clause providing that it shall not be canceled by the insurance company without written notice to the owner of intention to cancel that is in accordance with Arkansas Code § 23-66-206.
(f) Proof of insurance.
(1) Building Authority Division approval of contract shall be conditional upon the contractor providing proof of insurance to the owner.
(2) The contractor shall be financially responsible for all deductibles or self-insured retentions.
(g) Equipment and materials. The contractor shall be responsible for any loss, damage, or destruction of its own property or that of any subcontractor’s equipment and materials used in conjunction with the work.
(h) Subcontractors.
(1) The contractor shall require all subcontractors to provide and maintain general liability, automobile, and workers’ compensation insurance coverage substantially similar to those required of the contractor.
(2) The contractor shall require certificates of insurance from all subcontractors as evidence of coverage.
(3) The contractor will be the responsible party for all claims by subcontractors if a subcontractor fails to have appropriate insurance.
(i) Contractor’s insurance requirements.
(1) Commercial general liability.
(A) The contractor shall, at the contractor’s expense, obtain and keep in effect during the term of the contract commercial general liability insurance covering bodily injury and property damage containing minimum limits of one million dollars ($1,000,000) written on a per-occurrence form with a two-million-dollar aggregate limit.
(B) This insurance shall include personal injury coverage with employment exclusion deleted and contractual liability.
(C) Such coverage shall include products and completed operations and shall not be excluded under the commercial general liability insurance.
(D) Nothing shall prohibit a department from requiring increased amounts than stated herein.
(2) Umbrella liability.
(A) The contractor shall be required to furnish and keep in effect during the term of the contract umbrella liability coverage which provides excess limits over the primary coverages.
(B) Departments must refer to the recommendation of the Risk Management Division of the State Insurance Department on the minimum amount of coverage.
(3) Automobile liability. The contractor shall obtain, at the contractor’s expense and keep in effect during the term of the contract, automobile liability insurance including hired and nonowned coverage in minimum amounts of one million dollars ($1,000,000) per occurrence.
(4) Workers’ compensation and employers’ liability. The contractor, its subcontractors, and all employees providing work, labor, or materials used in connection with this work.
(5) Contractor’s equipment.
(A) The contractor shall be responsible for any loss, damage, or destruction of its own property or that of any subcontractor’s equipment and materials used in connection with this work.
(B) The contractor shall purchase, at the contractor’s sole cost and expense, insurance necessary to cover the contractor’s owned property.
(C) The contractor shall provide waiver of subrogation to the owner.
(6) Pollution liability.
(A) If requested by the owner at any time, the contractor shall, at the contractor’s sole cost and expense, obtain and maintain for the term of the contract pollution liability insurance covering losses caused by pollution conditions resulting from performance of the contract.
(B) This requirement also applies to any consultant or subcontractor engaged by the contractor or performing construction, geotechnical, well drilling, abatement activities, or contractor services.
(C)(i) Pollution liability insurance shall cover owner costs and liabilities attributable to:
(a) Bodily injury;
(b) Property damage, including loss of use of damaged property or of property that has not been physically injured;
(c) Cleanup cost; and
(d) Defenses, including costs and expenses (including attorney’s fees) incurred in the investigation, defense, or settlement of claims.
(ii) The contractor shall maintain such insurance in an amount of at least two million dollars ($2,000,000) per loss with an annual aggregate of at least five million dollars ($5,000,000).
(iii) Nothing shall prohibit departments from increasing this insurance limit.
(7) If coverage is written on a claims-made basis, the contractor represents that any retroactive dates applicable to coverage under the policy precedes the effective date of the letter, and that continuous coverage will be maintained, or an extended discovery period will be exercised for a period of three (3) years or as required by law beginning from the time that services under the contract are completed.
(8)(A) If the scope of work as defined in this contract includes the disposal of any hazardous or nonhazardous materials from the project site, the contractor must furnish the owner with evidence of pollution liability insurance maintained by the disposal site operator for losses arising from the insured facility accepting waste under this contract.
(B) Such coverage must be maintained in amounts conforming to applicable:
(i) Laws;
(ii) Rules; and
(iii) Regulations.
(9) Remediation.
(A) A remediation contractor shall provide liability insurance for the removal or remediation of asbestos, including the transportation and disposals of asbestos waste materials from the project site.
(B) Limits of insurance shall be not less than those required under the commercial general liability policy.
(C) Depending on the nature and amount of asbestos to be removed/abated, the owner may request higher limits than those required by the commercial general liability policy.
(10) Additional requirements. All policies shall be provided by insurers qualified to write the respective insurance in the State of Arkansas and be in such form and include such provisions as are generally considered standard provisions for the type of insurance involved.