Can an insurance company refuse to insure a contractor because of their insurance history?
Dec 25, 2023
By: Engineer Omri Nissany
Question:
We are an entrepreneurial company that applied to arrange insurance for a project after selecting a main contractor based on a contractor tender. The insurance companies asked us to present them with proven confirmation regarding the contractor's claims experience, and when we submitted the documents, we encountered a blanket refusal from all the insurance companies . This was due to a claim that the contractor's claims experience was poor. What can we do?
By: Engineer Omri Nissany
Question:
We are an entrepreneurial company that applied to arrange insurance for a project after selecting a main contractor based on a contractor tender. The insurance companies asked us to present them with proven confirmation regarding the contractor's claims experience, and when we submitted the documents, we encountered a blanket refusal from all the insurance companies . This was due to a claim that the contractor's claims experience was poor. What can we do?
Answer:
Indeed, insurance companies are currently checking the insurance history of the contractor performing the work. If his claims record over the past 5 years is problematic, they may well refuse to submit an insurance proposal.
As with many issues in the world of insurance, it is advisable to prevent a disaster before it happens. When preparing a contractor tender, it is recommended to receive, along with the commercial proposal, formal claims approvals from the insurance companies that have insured the contractor in recent years. It is advisable to examine the feasibility of arranging insurance with the contractor's claims experience before signing the performance contract.
In cases of doubt, you can contact the insurance company in advance to find out whether it will be possible to arrange insurance for the project in light of the specific contractor's resume.
Please note! A contractor's problematic claims experience should raise a "red flag" not only for the insurance company but also for the developer. It is recommended to carefully consider whether to contract with such a contractor, even without insurance. A bad claims situation may be an indication of the quality of the contractor.
Answer:
Indeed, insurance companies are currently checking the insurance history of the contractor performing the work. If his claims record over the past 5 years is problematic, they may well refuse to submit an insurance proposal.
As with many issues in the world of insurance, it is advisable to prevent a disaster before it happens. When preparing a contractor tender, it is recommended to receive, along with the commercial proposal, formal claims approvals from the insurance companies that have insured the contractor in recent years. It is advisable to examine the feasibility of arranging insurance with the contractor's claims experience before signing the performance contract.
In cases of doubt, you can contact the insurance company in advance to find out whether it will be possible to arrange insurance for the project in light of the specific contractor's resume.
Please note! A contractor's problematic claims experience should raise a "red flag" not only for the insurance company but also for the developer. It is recommended to carefully consider whether to contract with such a contractor, even without insurance. A bad claims situation may be an indication of the quality of the contractor.
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