Warranty Language

Most applications for General Contractors have an area where the GC initials that they get certificates of insurance from all their subcontractors. I have 3 contractors in the office today and explained this requirement. As usual everyone agrees that it will be done but sometimes in the rush of life the GC forgets. Recently a Breach of Contrator's Warranty case was litigated in the California Court of Appeal. Mr. Barry Zalma writes on the insurance industry claims pratice team for IRMI. As a Construction Risk Insurance Specialist I receive weekly updates and this article by Mr. Zalma (www.zalma.com) hit home.
---------LINK http://www.irmi.com/expert/articles/2009/zalma10-insurance-claims-practices.aspx

Breach of Contractor's Warranty Defeats Coverage
October 2009
Insurers who insure the liability of contractors will often include in their policy a warranty that compels the general contractor to obtain proof that all its subcontractors are insured. In an important case, North American Capacity Ins. Co. v. Claremont Liab. Ins.Co., 99 Cal. Rptr. 3d 225, 177 Cal. App. 4th 272 (Cal. App. Dist. 2, Aug. 4, 2009), dealing with a clause rarely litigated, the California Court of Appeal enforced such an agreement and issued a warning to all general contractors who do not comply with similar warranties that they may be eliminating their own coverage.
by Barry Zalma

So don't forget to collect certificates and get contracts in place with your sub contractors.