First, let's define Commercial General Liability and Marine General Liability.
Commercial General Liability
Commercial General Liability policies protect business owners against claims of liability for bodily injury, property damage, and personal and advertising injury (slander and false advertising).
Marine General Liability
Marine General Liability policies are the same as General Liability policies except they are designed specifically for those who work at sea. These policies include coverage for Marine Contractors and others who work on or near water.
Commercial General Liability does NOT cover Marine Liability
As you may have read in one of our previous blog posts, we explained that General Liability excludes marine work. A General Liability policy doesn’t include watercraft or water sport coverage; including the ownership, maintenance, and use of watercraft owned by you, the insured. The client or shipyard/vessel may never know about these exclusions by just looking at a certificate. It’s in the policy wording- which brings up the fact that an experienced insurance broker could help you when it comes to the specifics of policy exclusions and/or benefits.
Many Marine Contractors don’t offer their employees full coverage on liability insurance, partly because many of them do not know that Commercial General Liability doesn’t cover anything that happens on or near the water. Since their workers are not covered, this can create a substantial problem. If something were to happen to one of their workers, the contractor could be liable and not have any coverage to protect them from a lawsuit.
Why didn’t I Know about This?
Marine Contractors purchasing the policies want to save as much money as possible, so they often choose the cheapest policy; however, they are taking a huge risk working without the proper coverage. Without proper coverage the policy may not be worthwhile at all, so what you may be saving could end up costing your livelihood! Also, since shipyards, vessels, and ports don’t look into the coverages provided by workers on a certificate, they let them work with improper coverages, not knowing the exclusions that the contractors have in their policies. This is where the problem arises, since the shipyard is also liable and won’t be covered in the event of a loss or accident.
Why aren’t Marine Contractors Covered?
General Liability policies generally have a cheaper cost than Marine General Liability policies because they have so many exclusions. Your underwriter (who will develop the policies you need and assesses what premium you should have to pay), should take into account your risks - more risks, such as working around water, means more coverage needed - which determines whether your premium is high or low. So having more coverage is what makes a Marine General Liability policy more expensive than just a General Liability policy. At the end of the day, you get what you pay for.
If you have any more questions, would like further explanation, or want to change your General Liability policy to a Marine General Liability policy, please contact us here at MHG Insurance by calling 954-828-1819 or visiting mhginsurance.com. We would be happy to assist you with all of your insurance needs.