Warning Signs of Overcharges

Over the the past 35 years, we have found that certain things can be flags for overcharges or indicators that something may have been overlooked or not done properly and may have caused the Longshoreman and Workers' Comp premium to be higher than proper. Here are some common ones:

Classification changed to a more expensive one after policy begins
Classification changed recently to a less-expensive one (raising the question, should the employer been in the less-expensive class in years past as well?)
Increase in the workers compensation experience modification factor after the policy begins
Recent changes in ownership
Recent changes in business operation
Employer has recently left an employee leasing relationship
Premium credits pertaining to "state act workers compendsation- Does your state offer a Merit rating on your State Act Workers Compensation? Does it offer drug credits? Or a Safety Credit? Or a Contractor Credit? If an employer doesn’t realize that a premium credit might apply, and doesn’t fill out and send in the appropriate forms, the employer won’t get the premium credit.
Is your longshoreman insurance or workers compensation policy being written in the assigned risk plan even though your company can now be written in the voluntary market with lower workers compensation rates?
One class code may be correct in one state but wrong in another state resulting in higher or lower premiums being paid.

Only an expert and one who deals with Longshoreman Insurance and its distant cousin of Workers Compensation can keep up with all the complex changes, mod factors, and classification codes being used. Business owners have a business to run and our brokerage services have found ways to save Marine business and regular businesses thousands of dollars on their Longshoreman and/or workers compensation insurance. We recently saved one business over $75,750 PER MONTH on their Longshoreman Insurance.

Update December 15, 2015

Question: Since I am an owner of my company, can I exclude myself from Longshoreman Insurance like I do on my regular worker's compensation?

Answer:
The answer is no. One cannot exclude themselves from coverage under the Longshore Act (USLH) like one does on the regular worker's compensation coverage.

Update December 10, 2015

Question: Will my General Liability Policy (also known as a CGL or Comprehensive General Liability Policy) also cover my water related or marine insurance exposures?

Answer:
The answer is "no" probably not. To Follow is some policy language.

C.G.L. Watercraft Exclusion - "Bodily Injury or Property Damage" arising out of the ownership, maintenance, use or entrustment to others of any aircraft, "auto" or watercraft owned or operated by or rented or loaned to any insured. Use includes operation and "loading or unloading."

Question: If I have a Workers Compensation or Longshore claim takes place how do I report the claim?

Answer:
The Workers Compensation and Longshore claim must be reported directly to the carrier or insurance company involved. We furnish the details on how to do this with each binder we furnish and if you have any questions, please call us at (844) 667-6640 or (205) 221-5466 or after hours at (205) 275-5005 and we will be more than happy to help you with your claim. Harris Insurance stands ready to help you with your Commercial Marine and Longshore business and are committed to providing you with the best markets, resources and assistance you need to run your business.

Question: What type of business does your company insure?

Answer:
Here are some of the recent business types we have insured or worked on in the past 6 months.
-Boardwalk and Bridge Construction
-Marine Mining
-Boat Livery
-Welding / Ship Repair
-Repair service to shipyard
-Shipbuilder
-Commercial Diving
-Marine Electrical Contractor

LONGSHOREMAN INSURANCE RECENT CHANGES AS RELATES TO RECREATIONAL BOAT EMPLOYEES -

Are you involved with repair, dismantling and manufacture of recreational boats? If so you need to pay attention to some recent changes and regulations on the (LHWCA) Longshore Insurance requirement.

A recent 2009 change in the law is as follows: IF YOU REPAIR OR DISMANTLE A RECREATIONAL BOAT OF ANY SIZE, THIS WILL NOT CAUSE YOU TO BUY LONGSHORE INSURANCE IN MOST CASES. THERE IS STILL A "maybe" questions however. An exception to the rule is that if you are repairing a foreign flagged recreational vessel in the USA, then you fall under the exception of having to have USLH insurance. If you firm also works on non-recreational vessels then, make sure that you keep excellent records showing the payroll of non-recreational boat repair work and recreational boat repair work. This can save you thousands and thousands of dollars on your Longshoreman Insurance premiums!

Other exceptions to the USLH rule is when you work on public vessels such as police boats. Keep good payroll records on this as well. Vessels used in the military or commercial uses are NOT exempted from having to buy USLH insurance.

The US Department of Labor has a website that is very good and discussion can be found in the Federal Register.

December 9, 2015 update

Longshoreman and Marine Insurance definitions and questions.

What are the risks of chartering a commercial vessel?

When an entity or person charters a vessel, there are usually only 3 types of charters exercised as follows:

A. What is a "Voyage Charter "?- a voyage charter is whereby the charterer is "leasing" space on the vessel (a cargo hold or tank) for one voyage only. The charterer is essentially "along for the ride" since he exercises very little operational control over the vessel.

B. What is a "Time Charter"? -a time charter is where the charter leases the vessel for a perior of time (usually a year or more). The charterer shares operational control of the vessel with the Vessel Owner, and the ship's Master answers to both parties. The sharing of control normally divides between the vessel's cargo operations (mostly under control of the charter) versus vessel operations (under the control of the Vessel Owner).

C. What is a Bareboat (Demise) charter? - this is where the charterer essentially stands in the shoes of the Owner and leases the vessel for a significant period of time. The charterer has full operational control over the vessell and bears all the expenses to operate and maintain the ship. This arrangement allows a charterer to "look like" a Vessel Owner but not carry the expense of the costly asset on his balance sheet.

In case you come across this term "Owner Pro Hac Vice," this means taking the place of another.

What is a SAMPLE INSURANCE AGREEMENT?

Longshoreman Insurance is very expensive and the cost must be included in the bid for the job. Most of the time when a contractor is bidding on a job there will be a "Spec Sheet of Insurance Required." To follow is a SAMPLE INSURANCE AGREEMENT or "insurance required specification sheet:

December 7, 2015

Contractor shall obtain and maintain:
(a)Comprehensive General Liability insurance covering claims of passengers or other third parties to the extent by the negligent act or omission of Contractor's employees or other Contractor's
(b) Workers Compensation/Employer's Liability insurance covering its employees. Said insurance shall include a Longshore and Harbor Worker's Compensation Act Coverage Endorsement and a Maritime Coverage Endorsement with no territorial limits. The coverage shall include liability (if any) for:
(i) Maintenance and cure as well as personal injury or death claims asserted by Contractor's employees or their estates;
(ii) Repatriation, loss of personal effects and other costs to employees (including, without limitation, burial costs) in the event of death, casualty or termination of a voyage.
(c) All such insurance shall be in form, in amounts, with carriers and on terms reasonably satisfactory to SAMPLE COMPANY and shall name SAMPLE COMPANY as additional insured (with respect to General Liability Insurance). to the extent Contractor is liable under (a) above. Contractor shall provide to SAMPLE COMPANY, prior to the commencement of the term of the Agreement, Certificates of Insurance evidencing such coverage.

Once you as a contractor have the required insurance in hand give us a call at (844) 667-6640 and we will work with you to understand what you must have and the costs and risks associated with the insurance. Email is [email protected] or after hours at (205) 275-5005.

November 28, 2015

"Since I am new in business, can I get Marine General Liability and Longshoreman Insurance and how much is it gonna cost me?"

Our agency insured this client just last week. His company is a welding and repair contractor on the Gulf Coast and had to have State Workers Compensation, Longshoreman (USLH) Insurance and Marine General Liability for his operations. They do not work aboard a ship but work near the dockside.We have had clients who was required to have the USL&H or Longshoreman Insurance in place even though their job site was 5 miles away from the Bay or the body of water. As he is just now getting into business, we had to search our markets to get him coverage at a price he could afford. We call and emailed over 7 of our insurance companies before we arrived at a premium amount he could afford and one that had all the necessary requirements to satisfy his contract. It took us a couple of weeks to secure his quotes and his coverages. His projected payroll is around $250,000 and his down payment for the two policies was around $16,570. He will be making monthly payments as we go along and since his payroll is an estimate only, he will be keeping a sharp eye on the payroll over the coming 3-6 months in order to see if we need to adjust the payroll during the policy periods in order to avoid having a large audit due after the end of the policy period.