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Insurance Issues for Renewable Energy Installers

Insurance Issues for Renewable Energy Installers. Chris Sinton - CW Sinton Consulting, Middlebury, Vermont Joel Gordes – NYSEIA Roy Butler – Four Winds Renewable Energy Kathy Weinheimer – Independent Insurance Agents and Brokers of New York, Inc.

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Insurance Issues for Renewable Energy Installers

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  1. Insurance Issues for Renewable Energy Installers Chris Sinton - CW Sinton Consulting, Middlebury, Vermont Joel Gordes – NYSEIA Roy Butler – Four Winds Renewable Energy Kathy Weinheimer – Independent Insurance Agents and Brokers of New York, Inc. Project funded by the NYS Energy Research and Development Authority

  2. Outline • Overview of insurance requirements • Problems faced by installers • Summary of installer survey • Next steps • Discussion

  3. Insurance Types • Liability • Workers Compensation • Property and Vehicle

  4. Liability Insurance • Covers your liability for property or bodily injury caused during operation or from completed work • Blanket additional insured – added to the policy to cover customers and others, such as NYSERDA

  5. Liability Insurance • Obtained from private carrier through insurance agent • Carrier uses classification code to help determine rate • Many (most?) carriers do not have a solar installer classification • ISO (www.iso.com) has code 99080 Solar Energy Contractors

  6. NYS Workers Comp • The NYS Workers’ Compensation Law requires that every covered employer have workers’ compensation coverage for all employees (including part-time employees and employed family members). • Employees are entitled to workers’ compensation benefits for job-related injuries or illnesses, without regard to fault as a cause of the injury. In turn, if a workers’ compensation policy is in place, employees cannot sue employers for a work-related injury or illness in most cases.

  7. NYS Workers Comp Workers’ Comp coverage can be obtained by: • Private insurance carrier; • The State Insurance Fund; or • A Self-insured trust – need permission from Workers’ Compensation Board

  8. NYS Workers Comp • Classification codes are determined by state, which may follow classification set by NCCI (www.ncci.com). • Rates are based on percentage of employee payroll • Single owners without employees do not need coverage

  9. NYS Labor Law Sections 240 and 241 • Safe Place to Work Law • Absolute liability holds contractors solely responsible for all accidents that occur on a site, regardless of fault • A problem for all contractors, resulting in higher liability rates for NYS employers

  10. NYSERDA Requirements PON 716 and 792 • NYSERDA and the State of New York as additional insured; refer to PONs in policy • Commercial general liability minimum $1 million each personal injury and property damage • Commercial auto coverage of $500,000 personal injury per person, $1,000,000 personal injury per accident, and $500,000 property damage per accident.

  11. Problems? • Liability coverage difficult or impossible to find • Premiums are too high; can add $0.10 per installed watt PV • Lack of understanding by the insurance industry – height issue • Nationwide problem – see Home Power Magazine issue 103 Oct-Nov 2004

  12. Survey of Installers • Part of a larger survey contracted by NYSERDA • Of a total of 68 installers invited to participate by email, 34 responded • Most NYS, but some from MA and VT

  13. How are you classified for insurance purposes? __solar installer __electrician __ other (Please describe: ____________________)

  14. Are you or one or your employees or co-workers a licensed electrician? Yes 12 No 19 Did not respond 3 Do you ever hire an electrician as a subcontractor for PV projects? Yes 21 No 9 Did not respond 4

  15. Please provide your annual premiums for both Liability and Workers Compensation insurance. • fifteen installers responded, of which four did not report workers compensation • The total annual premium amounts range from $2,200 to $50,000 with an average of $10,600 and a median value of $7,000 • Normalized per employee – range of $580 to $6,000 - average is $3,208 ($2,800 excluding the highest value) and the median is $2,917

  16. Have you ever experienced any of the following (relating to insurance)? Auto coverage is too high – a common problem

  17. Next Steps Discussion with insurance carriers • Guide book describing the activities of the installer • Value of certification and training - NABCEP, OSHA, programs, manufacturers, etc • Business opportunity for the carriers • Group coverage through trade group such as SEIA and NABCEP

  18. Contacts • Chris Sinton – sinton@verizon.net 802-989-8287 • Alan Virgil – South Bay Risk Management alanvirgil@southbayriskmanagement.com 310-791-9855

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