The new safety regulations: The client enters the circle of responsibility. Who will protect the developer and the contractor in a fatal accident?
Oct 20, 2026
By: Itzick Simon, construction insurance and risk management expert
The first 24 hours after a disaster can determine the fate of the investigation, personal liability, and insurance protection.
A worker falls from a height. A crane collapses. A ceiling collapses. An excavator collapses on a worker inside it.
In an instant, work on the construction site stops. Rescue forces are called, workers gather around the scene, and the foreman tries to understand what happened. The site manager, safety supervisor, and safety inspector on behalf of the client, as many as have been appointed or are required by the project, may also enter the circle of handling and clarification, each according to their role and authority. News of the accident begins to spread.
When it turns out that a worker has been killed, the dimensions of the disaster become clearer. Behind every such accident stands a family that has lost a loved one, and sometimes also other families whose lives have been changed by the event.
But, in parallel with the human tragedy, another crisis begins to develop, one that is complex and has many implications. Within a short time, police investigators, Ministry of Labor inspectors, insurance company representatives, experts, and other researchers arrive at the site.
A site where, until a few minutes ago, professional cooperation took place between a developer, contractor, subcontractors, and officials, is becoming an arena of investigation where everyone may have different, and sometimes conflicting, interests.
During my decades of working in construction insurance, we at the agency also needed professional guidance following serious work accidents. One of the key lessons we learned is that the question is not limited to what caused the accident and who was responsible for it.
It is equally important to know who manages the crisis from the moment it occurs, who protects the rights of those involved, and what happens when it becomes clear that the insurance coverage does not fully address the created reality.
1. The construction site becomes an arena for investigation and project partners may become those with conflicting interests
In the event of a fatal accident, there is an obligation to report to the competent authorities, and alongside the criminal investigation, a broad inspection of the site's compliance with safety regulations may be initiated.
According to the Labor Inspection Organization Law, following a fatal accident at a construction site, an order to stop work is generally issued for an initial period of two working days. During this period, a labor inspector is required to inspect the safety situation at the site, and he may extend the validity of the order by an additional three days. If additional safety deficiencies are discovered that endanger human life, additional safety orders may be issued, which may result in a longer shutdown, until the danger is removed.
Meanwhile, a series of questions arise: Was the scene preserved? Were the conditions that existed before the accident documented? Were the security cameras, work logs, and engineering documents preserved? Were reporting obligations met?
Initial treatment must prioritize saving lives and preventing further danger. Along with this, evidence preservation, compliance with authorities' instructions, and early assistance from appropriate professionals are required.
However, beneath the surface, another problem sometimes begins to develop.
The foreman, project manager, main contractor, subcontractor and developer, who until that moment worked to achieve a common goal, may now be required to explain their decisions, their authorities and the extent of their involvement in the circumstances that led to the accident.
The construction operator may claim that he took the necessary safety measures, addressed deficiencies that were brought to his attention, and that the accident was caused by an act or omission of a subcontractor. The subcontractor may claim that he acted in accordance with the instructions he received. The foreman and the site manager, if appointed, may be required to explain how they supervised the execution of the work. The safety controller may present the inspections he conducted and the warnings he issued, while the client may claim that he fulfilled his independent duties, allocated the necessary resources, and acted in accordance with the reports he received.
These are not necessarily true or justified claims, but they illustrate why accident management cannot rely solely on the cooperation that existed before the event.
2. The new safety regulations: The person commissioning the work may also be required to provide explanations
On October 16, 2026, a fundamental change in the structure of safety responsibility in the construction industry came into effect.
Alongside the duties of the construction operator, independent duties were also established for the work commissioner, in accordance with the applicability of the regulations and the exceptions stipulated therein.
The client is required, among other things, to verify the existence of a safety plan, arrange the resources for its implementation in the agreement, appoint a safety controller, and meet the conditions set for granting written approval to begin work.
With the expansion of obligations, the scope of possible testing after a serious accident also changes.
The investigation may also include an examination of decisions made by the entities managing the project, and not be limited to examining the incident on the ground.
Who approved work to begin? Who received hazard alerts? What resources were allocated to address hazards? Were safety inspector reports reviewed? Were defects approved for treatment without verifying that they had been removed?
To the extent that there is evidence of relevant acts or omissions, the question of the liability of managers and officers may also arise, in accordance with their powers and duties under law.
A contract that places full responsibility for safety on the contractor does not necessarily protect the client from liability imposed directly on him by law.
From the perspective of the project's insurers, this means that the potential exposure of each of the insured parties and the protection provided to them must be re-examined.
On October 16, 2026, a significant change to the framework of responsibility for safety in the construction industry came into effect. Alongside the duties of the party responsible for the construction works, independent duties were established for the party commissioning the work, subject to the regulations’ scope and exceptions.
The commissioning party is required, among other things, to ensure that a safety plan exists, provide for the resources needed to implement it in the agreement, appoint a safety controller, and meet the conditions for granting written authorization to commence work.
These expanded duties also change the potential scope of an investigation following a serious accident.
An investigation may examine decisions made by those managing the project, rather than focus solely on the incident on site.
Who authorized work to begin? Who received warnings about risks? What resources were allocated to address hazards? Were the safety controller’s reports reviewed? Was corrective action approved without verifying that the deficiencies had been resolved?
Where there is evidence of relevant acts or omissions, questions may also arise regarding the liability of managers and corporate officers, depending on their authority and legal duties.
A contract placing full responsibility for safety on the contractor does not necessarily protect the commissioning party from liability imposed directly by law.
For project insurers, this means reassessing the potential exposure of each insured party and the protection provided to them.
A few years ago, I published a real case that illustrates the problem particularly sharply.
A contractor who came to me to arrange insurance for new projects asked, almost casually, that I review an existing policy for another project he had worked on.
Already at the first reading, fundamental problems became apparent.
The policy included a long list of conditions and protection requirements, some of which caused significant practical difficulty. Among other things, it included unusual requirements for taking out separate and primary insurance in connection with the operation of a crane on site.
I warned the contractor about the exposure and recommended that he demand that the developer settle the issue without delay.
Time passed.
Then came the phone call I didn't want to receive.
A concrete boiler being lifted by a crane tore and fell on a worker, who was killed on the spot.
The contractor asked for our help in dealing with the accident. When I asked if he had addressed the insurance deficiencies we had warned him about, it turned out that the issue had not been resolved.
This does not determine what the insurer's position was or what the insurance outcome of the event was. But the case clearly illustrates the risk of accepting a policy without examining its practical suitability for the project.
At precisely the most difficult moment, when the insured needs protection, he may discover that there are disputes regarding the insurance terms and the scope of coverage.
The lesson for me is clear.
The existence of a policy is not the end of the insurance review. The important question is whether a formula provides effective protection when a serious event occurs.
Even after the accident, it should not be assumed that every violation of a condition automatically negates coverage. The wording of the policy, the provisions of the Insurance Contract Law, and the circumstances of the alleged violation must be examined.
But it is better to prevent these disputes in advance, rather than deal with them when human lives have already been lost.
3. The big danger: There is an insurance policy, but is there coverage?
Several years ago, I published a real case that illustrates this problem particularly starkly.
A contractor who approached me to arrange insurance for new projects asked, almost in passing, whether I could review an existing policy for another project he was working on.
Even an initial reading revealed significant problems.
The policy contained a lengthy list of conditions and protective requirements, some of which presented substantial practical difficulties. Among them were unusual requirements for separate insurance providing primary coverage for crane operations on site.
I warned the contractor about the exposure and recommended that he ask the developer to address the matter without delay.
Time passed.
Then came the phone call I had hoped never to receive.
A concrete bucket being lifted by a crane broke apart and fell onto a worker, killing him instantly.
The contractor asked for our assistance in dealing with the accident. When I asked whether he had addressed the insurance shortcomings we had flagged, it became clear that the matter remained unresolved.
This does not establish the insurer’s position or the eventual coverage outcome. However, the case clearly illustrates the risk of accepting a policy without examining its practical suitability for the project.
At the most difficult moment, when the insured needs protection, they may discover disputes over the policy’s conditions and the scope of coverage.
For me, the lesson is unequivocal.
Having a policy is not the end of the insurance review. The crucial question is whether its wording provides effective protection when a serious incident occurs.
Even after an accident, it should not be assumed that every breach of a policy condition automatically invalidates coverage. The policy wording, the provisions of the Insurance Contract Law and the circumstances of the alleged breach must all be examined.
But it is better to prevent these disputes in advance than to confront them after a life has already been lost.
4. The criminal investigation: Who pays for the protection of the directors?
When a foreman, project manager, or company director is called in for questioning following a fatal accident, the need for professional legal representation may be immediate.
However, not every insured is aware that criminal defense expenses are not automatically covered under liability insurance.
Some policies include extensions for defense expenses in criminal or administrative proceedings. However, their scope varies from policy to policy.
It is necessary to check whether the coverage already applies at the investigation stage, which of the officials are included in the definition of the insured, what are the limits of liability, whether it is possible to choose a lawyer, and what are the conditions for activating the extension.
Another problem arises when the interests of the company and the officers are not the same.
The company may need one representation, while the foreman or other officer may require separate representation.
There is not always a satisfactory insurance answer for each of them.
In our experience, this is one of the issues that should be settled at the policy purchase stage. It is difficult to retroactively correct the lack of coverage for legal expenses that have already been incurred.
It is also worth remembering that the existence of directors and officers liability insurance does not guarantee a solution. The applicability of the coverage, the bodily injury exclusions, and the specific extensions purchased should be checked.
When a site foreman, project manager or company manager is summoned for questioning following a fatal accident, the need for professional legal representation may be immediate.
However, not every insured is aware that criminal defense costs are not automatically covered under liability insurance.
Some policies include extensions covering defense costs in criminal or administrative proceedings, but their scope varies from one policy to another.
It is necessary to check whether coverage applies from the investigation stage, which personnel fall within the definition of insured persons, the applicable liability limits, whether the insured may choose their lawyer, and the conditions for activating the extension.
A further problem arises when the interests of the company and its personnel diverge. The company may need one legal representative, while the site foreman or another officer may require separate representation.
Adequate insurance coverage is not always available for each of them.
In our experience, this is an issue that should be addressed when purchasing the policy. It is difficult to remedy a lack of coverage retrospectively once legal expenses have already been incurred.
It is also worth remembering that directors’ and officers’ liability insurance does not guarantee a solution. The scope of coverage, bodily injury exclusions and the specific extensions purchased must all be examined.
In the event of death in a work accident, the deceased's family members and dependents may be entitled to benefits from the National Insurance Institute, and in appropriate circumstances, may also file a tort claim.
However, alongside the civil lawsuit, there is another exposure that must be taken into account: the National Insurance Institute's right of restitution against third parties responsible for the damage, according to the provisions of the law.
In some cases, the exposure may include the value of pensions paid and the value of future pensions, over the years.
Therefore, it is important to distinguish between the employer of the worker who was killed and other parties on the site, including the main contractor, the work orderer, and other subcontractors.
This distinction may affect both the system of liabilities and the right to claim compensation.
Here too, a thorough examination of employers' and third-party liability policies, the identity of the insured, and existing extensions is required.
One accident may give rise to several legal proceedings, against different parties, and sometimes under different insurance policies.
Proper insurance treatment must foresee all exposures, not just the first claim that is filed.
5. The insured event does not end with the family's claim.
After a serious accident, investigators, appraisers, and experts from insurance companies also arrive at the site.
This is a natural and important activity for clarifying the circumstances of the incident and the applicability of coverage.
However, it should be remembered that the insurance company and the insured are not necessarily in the same situation in terms of legal and insurance interests.
The insurer may inquire whether an insured event exists, whether the terms of the policy have been met, whether an exception has occurred, and whether another party is liable.
The insured, on the other hand, needs legal protection and protection of his rights, sometimes even before the facts have been clarified.
Hence the importance of involving a professional on behalf of the insured, who is familiar with the insurance terms and the structure of the project and can assist in coordinating the necessary actions with the insurers and with legal advice.
At our agency, we have formed over the years a team of professionals that allows us to assist clients in dealing with serious accidents, including the involvement of insurance experts, engineers, accident investigators and lawyers, depending on the circumstances and need.
The concept is simple: In the event of a serious incident, it is not enough to send a message to the insurance company and wait for its response.
Professional and proactive treatment is required, which begins as early as possible and accompanies the insured in dealing with the event.
6. Investigating the insurance company: Who looks after the interests of the insured?
When a construction site is shut down after a fatal accident, it's not just the physical work that stops.
Workers and subcontractors are laid off, equipment and cranes remain on site, delivery dates are pushed back, and financing and overhead expenses continue to pile up.
The contractor and the developer may find themselves in disputes regarding responsibility for delays, schedule extensions, downtime expenses, and contractual damages.
It is important to understand that a contractor's work insurance policy does not provide coverage for financial damages resulting from the closure of the site following a fatal accident.
Coverage for delay in project completion, to the extent purchased, is also subject to its terms and the existence of the factors that trigger it, and generally requires covered physical damage.
Hence, not all significant damage to a project is necessarily insurable damage.
Therefore, the agreements between the client and the contractor and the contractual sharing of risks between them are also of great importance.
7. The stop-work order is just the beginning of the economic damage
8. Don't wait for an accident to set up an accident handling team
One of the important conclusions we have drawn over the years is that we should not wait for an accident to occur to start finding out who will handle it.
A serious construction company should know in advance how it will act in the event of a serious accident.
Who manages the event? Who reports to the authorities? Who takes care of documenting the scene and preserving the evidence? When are the lawyers involved? Who is notified at the insurance company? Who maintains contact with the victim's family? And how do we prepare for the implications for the continued implementation of the project?
The answers cannot be determined improvised, under pressure, when managers and employees are still trying to digest what happened.
A structured response procedure is required, tailored to the organization's structure and the characteristics of the projects. It must combine reporting obligations and dealing with the authorities with safeguarding the rights of those involved, evidence, and insurance protection.
The procedure should also include a prior examination of extensions to legal defense expenses, limits of liability in policies, the status of subcontractors, and the handling of subrogation claims.
It is equally important to practice it, so that in the event of a real incident, those in charge know how to act.
And most importantly: a professional who is familiar with the system of debts, agreements, and insurance must be involved as early as possible.
The new safety regulations pose a significant challenge to the construction industry. They expand the set of obligations, strengthen control mechanisms, and require more direct involvement of those who order the work.
Alongside preparing for accident prevention, I believe it is time to also put on the agenda preparations for dealing with a fatal accident.
Coping requires a combination of managerial responsibility, organizational preparedness, insurance expertise, and the ability to make the right decisions at the most difficult times.
Over the years, I have met contractors and developers who invested significant amounts in insurance, but did not always know what was expected of them when they were required to activate it.
They needed an appropriate policy, but also professionals who knew how to guide them within the complex array of investigators, authorities, insurance companies, lawyers, and other officials.
A fatal work accident cannot be reversed. But we can and should prepare in advance so that dealing with the disaster does not create additional failures that could have been prevented.
Not only to prevent accidents. Knowing how to cope even when disaster strikes
New safety regulations:
The entry into force of the new safety regulations on October 16, 2026 changes the rules of the game. For the first time, the client is imposed with independent and explicit safety obligations, alongside the obligations of the construction operator and those in charge of the site.
In the event of a fatal accident, the circumstances of the accident may be examined, as well as the client's decisions, safety controller reports, resource allocation, and alert handling.
Expanding the circle of responsibility also requires rethinking insurance protection: who is insured, who is entitled to legal representation already at the investigation stage, and whether existing policies provide a response to the new exposures.
The message to developers, contractors, and work orderers is clear: the new regulations require preparation to prevent the next accident, alongside professional, legal, and insurance preparation for the day when, God forbid, the disaster occurs.
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