Builders risk policies can provide coverage for coronavirus-related losses if the policy language allows for it, although exclusions frequently exist for pandemics and work stoppages, two attorneys write. "Given the intense social, legislative and executive pressure to cover COVID-19 claims, there may be a tendency for the courts to find coverage in gray areas," the attorneys write.
Builders risk insurance generally won't cover pandemic-related losses, which typically require that covered losses be physical. However, at least one company is offering coverage triggered by losses resulting from a pandemic.
Surety Agents and Sureties Can Help Small Contractors Manage Risk Before bidding on jobs or signing contracts, small contractors should get expert information from surety agents and sureties on how to reduce risk. Working together, they can examine and mitigate possible risks from owners, general contractors, contract language, suppliers, labor issues, materials availability and pricing, weather, thieves and safety practices. Learn more here
The Small Business Administration approved nearly 178,000 loans totaling about $45 billion for the construction industry in the first round of the Paycheck Protection Program. Additional funding for the program has gained Senate approval and could see a House vote by Thursday.
Many states are urging the construction sector and other industries deemed essential to adhere to the Centers for Disease Control and Prevention's guidance for safety during the coronavirus pandemic, but some states are making compliance mandatory. The governors of Maryland, New Jersey and Pennsylvania have issued executive orders requiring essential businesses to follow the CDC guidelines.
An appeals court has held that a surety is not liable for its contractor's default because the owner did not provide timely notice. The decision demonstrates that timely notice from owners can be necessary even if the terms of a bond do not specify a time frame for notification, an attorney writes.
NASBP Blog: Construction project shutdowns: Know your general contract terms for force majeure, suspension and termination
As state and local governments shut down construction projects in response to the COVID-19 pandemic, project owners and contractors should review closely the general contracts for their projects to determine what consequences shutdown orders will have on those projects. John P. Martin, special counsel in the Boston office of McCarter & English, describes best practices for negotiating the construction contract language of such terms negotiated for important contract provisions, such as the force majeure, suspension and termination provisions, which can be critical to assessing next steps and potential responses. Read more.
April 28 NASBP Virtual Seminar: COVID-19's impact on the construction industry now and in the future
A survey found that 93% of building departments are still conducting inspections amid the coronavirus pandemic and that more than 60% are unable to perform inspections remotely. The International Code Council says departments should take steps starting with getting clearance from the appropriate officials before beginning remote inspections.
You have to not know in order to see what stories your life's efforts bring you. The mystery is all.
Lorrie Moore, writer
Founded in 1942, NASBP is the association of and resource for surety bond producers and allied professionals. NASBP producers specialize in providing surety bonds for construction contracts and other purposes to companies and individuals needing the assurance offered by surety bonds.