Frequently Asked Questions
June 22, 2017
Answer: Wow! Several questions there. USL&H is the acronym used for US Longshoreman and Harbor Workers Act, that's all. They are one and the same. Jones Act is a different animal. Jones Act is federal legislation that protects American workers injured AT SEA. It is sometimes referred to as the Merchant Marine Act of 1920. This law allows sailors who have been injured in accidents or who become sick while working at sea doing their duties to recover compensation from their employers. Jones Act provides for the promotion and maintenance of the American merchant marine and its purpose to promote a vibrant American merchant marine workforce for the US of A. The carriage of goods and passengers between United States ports is limited to US built and US flagged vessels.
Concerning General Liability coverages, the requirement to have USL&H coverage CANNOT be included under ANY general liability coverage!
"What is P&I?" P & I refer to Protection and Indemnity. P&I is a mutual maritime insurance provide by a P&I Club, typically a Club sponsored by one of the Lloyds of London Maritime entities. P&I is used to cover the vessel hull, other vessel risks, and also the crew. Crew coverages are for Injury, Illness, Loss of Life, Hospital, Medical and other expenses.
June 9, 2017
Answer: The contractor would have to have the following types of insurance at a minimum:
a. Worker's Compensation/Employer's Liability insurance to include Longshoreman and Harbor Worker's Compensation Act Coverage (USLH) and Maritime Coverage Endorsement with no territorial limits or worldwide.
b. Comprehensive General Liability insurance for bodily injury and property damage for at least $1,000,000 on a per occurrence basis, covering claims arising out of or in connection with Contractor's operations or the actions of contractor's employees and/or its subcontractor.
c. Such insurance shall name (main party, such as the cruise lines) as additional insured and with a waiver of subrogation.
The cost of the insurance will depend on the actual payroll and the number of workers that will be employed. For a one-man operation, the minimum premium will be $10,000 and this will probably be the minimum-earned amount, which means that all the premium will be earned from the "git-go" and has to be paid up front with no payment plan.
May 30, 2017
Answer: Yes. Your company is paying at least 20% more than the average company is paying for workers compensation. If your minimum modification factor were .70, this means that your company could be paying up to 50% more than it should for workers compensation. Businesses that have more than $10,000 in premium over the last two years qualify for an Experience Modification Factor. This is sometimes called an "X-mod" or Experience Mod. These modifications factors are computed by the NCCI or the National Council on Compensation Insurance located in Boca Raton, Florida. This factor allows the industry to charge more for companies that have more claims and to charge less for companies that have fewer claims. This gives the employer the opportunity to manage its own costs. For example, a company with a .75 mod factors with a premium of $100,000 will have a modified premium of $75,000 while a company with a premium of $100,000 and a mod factor of 1.25 will pay a modified premium of $125,000! Unlike most other insurance coverages, workers compensation and Longshoreman Insurance is the one insurance premium that can be controlled by the employer.
May 11, 2017
Answer: We can write the clients who need the Longshoreman Insurance. However, the company’s annual payroll will need to be in the $75,000 to $100,000 range at a minimum in order for us to quote it.
Concerning your second question, yes, you are correct. Your client will need general liability (GL) and or have the GL policy endorsed to cover marine also. Without this endorsement you client runs the risk of having an uncovered loss.
Call us at (205) 221-5466 and we can discuss risk solutions for you.
March 29, 2017
Answer: Whether you are a staffing company or a pure marine contracting company, it doesn't matter. We have options for you.
The cost will depend on your payroll and your risk category or what you will be doing. However, we do have ways to get you started for a minimum amount of outlay if your payroll is large enough for the insurance company's appetite. In some cases we can help you get going and not have to make a large payment until 30 days after the inception of your policy. This will give you time to get some monies coming back in your direction before making a huge capital outlay of funds. We are very experienced in doing various things depending on the situation.
Again, each company situation is different one from the other. We can be reached at (205) 221-5466 to discuss your options on how to get this going. Also, for the larger companies that are already paying large premiums of say $75,000 to $100,000 per month, we need to have a conversation about options to reduce your premium outlay and to increase your net profit. We are more than just a marine brokerage house. We offer solutions to your many questions. Let's have a conversation. After hours, we can be reached at (205) 275-5005.
December 22, 2016
Longshoreman Insurance and MEL
Answer: Maritime Employers Liability (MEL) was first written more than fifty years ago and is widely available in the market today, it remains one of the most mysterious of marine coverages-- falling somewhere between Ocean Marine Lines and Workers’ Compensation. What is MEL? MEL is coverage for an employer’s liability to its employees that would fall under Admiralty Law, roughly equivalent to Workers’ Compensation when someone is on a vessel. It can include Jones Act as well as General Maritime Law remedies including Maintenance & Cure, Unseaworthiness and Death oMEL is NOT a compensation policy and does not cover any benefits available under Workers’ Compensation, Longshore & Harbor Workers Compensation Act, Outer Continental Shelf Lands Act or any other state or federal workers’ compensation system. Most MEL policies contain specific exclusions for all those, but some older policies did not contain these exclusions and are specifically endorsed to add them. Confused yet? In addition, MEL is not a replacement for a Protection and Indemnity (P&I) policy. A P&I policy offers not only coverage for employees, but also a large amount of third party bodily injury and property damage liability coverage not found in the MEL policy. Further, most MEL policies exclude the true “crew” of an employer on owned vessels. Those are the people specifically covered by most P&I policies. MEL is one of the most critical parts of many marine insurance programs and, if properly understood and placed, can provide essential coverage.
MEL covers two groups of workers:
1) Your employees on someone else’s vessels. Small or large, oil rig, yacht, barge, or cruise ship, you have a liability for your employees when placed aboard other vessels even though you are not the owner or operator of that vessel. In addition, most vessel/rig owners will require the employer to prove MEL coverage is in place under their contracts before allowing your employees aboard their vessels. Who does a MEL policy cover? AND it covers,
2) Employees who are temporarily on board one of your own vessels. For example, a marine construction company may have a full-time captain who is covered under their P&I policy, but also employ some land-based employees who work on board vessels part of their time. These land-based employees can be best covered under MEL. Unfortunately, the courts have held that certain employees who fall under the Longshore Act can also bring claims under Admiralty Law. Call our offices at (844) 667-6640 to schedule a consultation. Also, you may email us at [email protected]
November 8, 2016
Exclusions fall under the “Status” portion of the Longshoreman Act. “Status” has to do with an employee’s job. The term “employee” means any person engaged in maritime employment, including any longshoreman or other person engaged in longshoreing operations, and any harbor-worker including
A ship repairman, shipbuilder, and ship-breaker, but such term does not include:
A) individuals employed exclusively to perform office clerical, secretarial, security, or data processing work:
B) individuals employed by a club (example is a yacht club), camp (think youth camp), recreational operation (jet skis, personal watercraft), restaurant, museum, or retail outlet;
C) individuals employed by a marina and who are not engaged in construction, replacement, or expansion of a marina (think direct employees of a marina)
D) individuals who
1. are employed by suppliers, transporters, or vendors,
2. are temporarily doing business on the premises of an employer described above and
3. are not engaged in work normally performed by employees of that employer under this ACT.
E) aquaculture workers;
F) individuals employed to build, repair, or dismantle any recreational vessel under sixty-five feet in length; (Some individuals may be subject to coverage under a State Workers Compensation Law)
G) a master or member of a crew of a vessel;
or
H) any person engages by a master to load or unload or repair any small vessel under eighteen tons net;
IMPORTANT NOTE: (OWNERS CANNOT EXEMPT THEMSELVES UNDER THE LONGSHOREMAN ACT)
October 20, 2016
This coverage is NOT site specific. It is good to have this coverage and sometimes can be obtained at no extra cost.
This is a critical coverage for Contractors and Sub-contractors or Ship Repairers. For your liability sake, please make sure that this is covered under you policy
Some policies will say something like: "Notwithstanding anything contained herein to the contrary, this Insurance shall not cover any liability in respect of loss or damage specified herein unless discovered and reported in writing to Underwriters within 12 months after policy expiration. This can be a very bad clause to have in your policy. Have your agent negotiate to remove this clause from your policy or at least extend the discovery period to up to 60 months.
September 14, 2016
The last employer who employs the employee pays the Longshoreman Claim. For this reason it is a very good reason to require physicals for new employees.
August 23, 2016
A: The answer is, "It depends!"
The USL&H Act 902 does exclude the following: "individuals employed to build any recreational vessel under sixty-five feet in length, or individuals employed to repair any recreational vessel, or to dismantle any part of a recreational vessel in connection with the repair of such vessel..."
However, the Longshoreman Insurance Act includes individuals building recreational vessels 65' or longer or dismantling a recreational vessel when it is not in connection with the repair of that vessel.
And Work, such as repair or installation of equipment, on recreational vessels may be subject to the Longshoreman Insurance Act if the vessel is chartered with a skipper or crew on "more than an infrequent basis" or chartered as a bareboat with more than 12 passengers.
A: Subsection 902(3)(D) of the Longshoreman Insurance Act (USL&H) states that a vendor’s employee is not subject to the USL&H Act if the employee is
1) is temporarily performing services on the premises of a maritime business;
2) is not engaged in work normally performed by employees of that maritime business; and (3) is covered by a state’s workers’ compensation program.
Update August 15, 2016
The following is a good article that takes one step-by-step through the process of 'Do I really need USL&H?
Click Here to read the article
Update July 14, 2016
Our Answer: The MEL coverage will not cover the worker in Europe once he steps off the ship. MEL only covers the worker while the ship is in navigation. An international coverage is required and is very affordable.
Our Answer: The definitive source is the US Dept. of Labor.
Please go to their site:
Publications
Also see this Blog on Marine and Longshoreman Insurance.
Update July 12, 2016
Our Answer: (We assume that your 1099 worker does not have any liability or State Act Work Comp or Marine General Liability coverage in force on his own)
I.Your rates on Liability and Marine General Liability are based on your gross sales....no limits. You just pay according to how much business you do.
II. Same goes with State Act Workers Compensation (except the rates are based on Payroll) and for USLH (Longshoreman Insurance). You pay WC and USLH based on rates per $100 payroll. There are no limits other than your ability to pay.
III. Caution is urged in that you will be hit with a potentially huge audit billing if you do not notify the insurance companies as you move along growing your business of your increase and gross sales and payroll and have them adjust your sales for liability and payroll for WC and USLH.
IV. Call us to discuss at (844) 667-6640
Update July 5, 2016
Our Answer: "No, we do not need your new worker's names at this time. Your company payroll will be included under your Longshoreman Insurance and under your General Liability sales and we do not need individual names. He will be covered automatically. Have a good trip!"