Bernards (Project Name) CCIP Insurance Manual

Bernards (Project Name) CCIP Insurance Manual Policy Year: xxxx-xxxx Alliant Version 01 1

Table of Contents 1.1 INTRODUCTION... 3 1.2 Overview... 3 1.3 About this Manual... 4 2.0 PROJECT DIRECTORY... 5 3.1 CCIP INSURANCE COVERAGE... 7 3.2 Description of CCIP Coverages... 8 3.3 CCIP Termination or Modification... 9 4.1 SUBCONTRACTOR REQUIRED COVERAGE... 10 4.2 Subcontractor Maintained Coverage... 11 5.1 SUBCONTRACTOR RESPONSIBILITIES... 13 5.2 Subcontractor Bids... 13 5.3 Calculation of Insurance Credits... 14 5.4 Enrollment... 15 5.5 Safety Guidelines... 15 5.6 Assignment of Return Premiums... 16 5.7 Change Order Procedures... 16 5.8 Close-Out and Audit Procedures... 16 6.1 CLAIMS PROCEDURES... 17 6.2 Liability Claims... 17 6.3 Property and Builder s Risk Claims... 18 6.4 Automobile Claims... 18 6.5 Pollution Claims... 18 7.0 PROJECT FORMS... 19 Alliant Version 01 2

INTRODUCTION 1.0 INTRODUCTION SECTION 1 1.1 Overview Bernards ( Owner ) has arranged for its construction projects to be insured under its Contractor Controlled Insurance Program (CCIP). A CCIP is a single insurance program that insures the Owner, Bernards, Construction Managers (if any), all Enrolled Subcontractors under Contract with Bernards and other designated parties for Work performed at the (Project Name) Project Site. (For simplicity s sake, the term Subcontractor as used in this Insurance Manual shall also refer to any Contractor also under contract to Bernards.) Certain Subcontractors are excluded from this program. These parties are identified in Section 3 of this manual. Coverage under the CCIP includes General Liability and Excess liability. There is no Workers Compensation coverage under the CCIP. Bernards will pay insurance premiums for the CCIP coverage described in this manual. You should notify your insurance broker/insurer(s) of the coverages provided under this Program for on-site activities to avoid the duplication of coverage and the related costs. (For purposes of this Insurance Manual, On-site shall mean at the (Project Name) project site; off-site shall mean away from the (Project Name) project site.) Each bidder is required to include in its bid price its normal cost for insurance coverage. The credit for CCIP-provided insurance is then deducted as described in Section 5, Calculation of Insurance Credits. NOTE: Insurance coverages and limits provided under the CCIP are limited in scope and are specific to work performed after the inception date of your enrollment into this program. Your insurance representative should review this information. Any additional coverage you may wish to purchase will be at your option and expense. Alliant Version 01 3

INTRODUCTION 1.2 About this Manual The Insurance Manual was prepared by Alliant Insurance Services (Alliant) and Bernards. Alliant is the insurance broker and CCIP Administrator for this program. The manual is designed to identify, define and assign responsibilities for the administration of the (Project Name) CCIP. This Manual: Generally describes the structure of the CCIP Identifies responsibilities of the various parties involved in the project Provides a basic description of CCIP Coverage Describes audit and administration procedures Provides answers to basic questions about the CCIP Will be updated as necessary This Manual does not: Provide coverage interpretations Provide complete information about coverage Provide answers to specific claims questions Specific questions about the CCIP, its administration, or the coverage provided should be referred to the CCIP Program Manager identified in the Project Directory section immediately following this introduction. DISCLAIMER: The information in this manual is intended to outline the Wrap-up Program. If any conflict exists between this manual and the Wrap-up insurance policies or Contracts between Bernards and the Contractor/Subcontractor, the policies or Contracts will govern. Alliant Version 01 4

PROJECT DIRECTORY 2.0 PROJECT DIRECTORY SECTION 2 CCIP BROKER Alliant Insurance Services Construction Services Group 333 S. Hope St., Suite 3750 Los Angeles, CA 90071 PROGRAM MANAGER XXX PROGRAM ADMINISTRATOR XXX SAFETY DIRECTOR XXX CLAIMS DIRECTOR XXX Alliant Version 01 5

PROJECT DIRECTORY 2.0 PROJECT DIRECTORY Bernards 555 First Street San Fernando, CA 91340 Main Line: 818-898-1521 Project Executive XXX Project Manager XXX Safety Manager XXX CCIP Coordinator XXX Alliant Version 01 6

WRAP-UP INSURANCE COVERAGE 3.1 CCIP INSURANCE COVERAGE SECTION 3 This chapter provides a brief description of CCIP Coverage. You should refer to the actual policies for details concerning coverage, exclusions and limitations. Enrolled Parties Enrolled Parties are "named insureds" on the CCIP policies and include Owner, General Contractor, and Enrolled Subcontractors of every tier. In addition, there may be parties named as additional insured that include other parties the Owner is contractually required to add. These parties are also referred to as insureds. Excluded Parties Excluded Parties are precluded from CCIP coverage and are described as engineers (including their consultants,) surveyors, soil testing engineers, demolition, hazardous waste removal and/or transport companies, vendors, suppliers, fabricators, material dealers, truckers, haulers, drivers and others who merely transport, pickup, deliver, or carry materials, personnel, parts or equipment or other items, or persons, to or from the Project Site. Bernards reserves the right, at its sole discretion, to include or exclude any contractor or subcontractor from the CCIP. Evidence of Coverage The CCIP Administrator will provide a Certificate of Insurance evidencing general liability insurance to each Enrolled Subcontractor, each of whom will be a named insured on the policies. A Certificate of Insurance is a document providing evidence of existing coverage for a particular insurance policy or policies. Other documentation including forms etc., will be furnished to each Enrolled Subcontractor. Complete copies of policies will be furnished to an authorized representative of each Enrolled Subcontractor on request. Alliant Version 01 7

WRAP-UP INSURANCE COVERAGE 3.1 Description of CCIP Coverages The following sections describe the policies that Bernards has arranged for its projects. The CCIP provides no Workers Compensation coverage. Commercial General Liability Limits of Liability Shared by All Insureds for All Projects General Aggregate $ 5,000,000 Products/ Completed Operations Aggregate $ 5,000,000 Personal/ Advertising Injury $ 5,000,000 Each Occurrence Limit $ 5,000,000 Fire Damage Legal Liability (any one fire) $ 100,000 See Section 5.2 for deductible information. A Single General Liability policy will be issued covering all insureds. Underwritten by XXX under policy #XXX Ten (10) Year/Statute of Limitation Products/Completed Operations Extension Endorsement for homes that close escrow during each annual policy period. IF A GENERAL LIABILITY CLAIM RESULTS FROM ANY CONSTRUCTION ACTIVITY, THE RESPONSIBLE CONTRACTOR, SUBCONTRACTOR, OR SUB-SUBCONTRACTOR SHALL PAY A CLAIMS CHARGE TO THE OWNER BASED ON THE SAME DEDUCTIBLE OR SELF- INSURED RETENTION AMOUNT APPLICABLE TO THEIR CONVENTIONAL (NON-CCIP) GENERAL LIABILITY POLICY, SUBJECT TO A MINIMUM AMOUNT OF $5,000, FOR EACH OCCURRENCE. A CHANGE ORDER WILL BE WRITTEN TO RECOVER THIS CLAIMS CHARGE. Excess Liability Each Occurrence Limit Annual General Aggregate Limit Limits of Liability Shared by All Insureds for All Projects $ xxx $xxx Underwritten by: xxx Alliant Version 01 8

WRAP-UP INSURANCE COVERAGE NOTE: Contractors and Subcontractors are advised to arrange their own insurance for Contractor or Subcontractor owned or leased equipment and materials not intended for inclusion in the project. The CCIP will not cover Contractor or Subcontractor property. The descriptions on these pages provide a summary of coverages ONLY. Contractors and Subcontractors should refer to the policies for actual terms and conditions. Copies of policies will be provided upon request. 3.2 CCIP Termination or Modification Bernards reserves the right to terminate or modify the CCIP or any portion thereof. If the Owner exercises this right, Subcontractors will be provided notice as required by the terms of their individual contracts. At its option, the Owner may procure alternate coverage or may require the Contractors to procure and maintain alternate insurance coverage. Alliant Version 01 9

SUBCONTRACTOR REQUIRED COVERAGE 4.0 SUBCONTRACTOR REQUIRED COVERAGE SECTION 4 Subcontractors are required to maintain insurance coverage that protects Bernards from liability for claims for damages. These liabilities may arise from the Subcontractor s operations performed away from the Project site, from activities not insured by the CCIP, or from operations performed by Excluded Parties. There are two types of subcontractors: Eligible Subcontractors and Excluded Subcontractors. Eligible Subcontractors are to provide evidence of Workers Compensation insurance for all activities including both on-site and off-site (away from the Bernards project site) activities, and General Liability for off-site activities as per the insurance specifications in the contract. See Section 3 for the definition of an Eligible Subcontractor. Excluded Subcontractors must provide evidence of General Liability and Workers Compensation insurance for all activities including both on-site and off-site activities as per the insurance specifications in the contract. See Section 3 for the definition of Excluded Parties. All Subcontractors must submit verification of insurance in the form of a Certificate of Insurance on a standard ACORD form 25-S. The Certificate must evidence that each carrier has provided a Waiver of Subrogation in favor of the Owner as referenced by the General Conditions of the Contract for Construction. Please note the requirements for thirty (30) day notice of cancellation, modification or material change. All General Liability Policies shall name: (Project Name) ; The members of (Owner), and its officers, agents, employees and volunteers; ARCHITECT; Bernards Bros. Inc., their officers, employees and agents and any wholly owned subsidiaries or parent organizations, as additional insured by use of Standard Insurance Service Office Form CG20100704 and CG20370704 or their equivalent. (See Contract for specific language.) Subcontractor(s) is responsible for monitoring their Enrolled lower tier Subcontractors and Excluded Parties Certificates of Insurance. Bernards reserves the right to disapprove the use of Subcontractors unable to meet the insurance requirements. Certificates evidencing compliance are to be available to Bernards, or the CCIP Administrator upon request. Alliant Version 01 10

SUBCONTRACTOR REQUIRED COVERAGE 4.1 Subcontractor Maintained Coverage The limits of liability shown for the insurance required of the Contractors and Subcontractors are minimum limits only and are not intended to restrict the liability imposed on the Contractors and Subcontractors for work performed under their Contract. Workers Compensation and Employer s Liability Part One: Workers Compensation Statutory Limit Part Two: Employer s Liability Annual Limits Per Insured Bodily Injury by Accident, each accident $1,000,000 Bodily Injury by Disease, each employee $1,000,000 Bodily Injury by Disease, policy limit $1,000,000 Eligible Subcontractors shall provide evidence of workers compensation applicable to onsite and off-site activities. Waiver of Subrogation endorsement required. Excluded Subcontractors shall provide evidence of workers compensation applicable to on-site and off-site activities. The CCIP does not provide coverage for workers compensation. General Liability and/or Excess Liability Enrolled Parties General Aggregate $ 4,000,000 $ 4,000,000 Products/ Completed Operations Aggregate $ 4,000,000 $ 4,000,000 Personal/ Advertising Injury $ 3,000,000 $ 3,000,000 Each Occurrence Limit $ 3,000,000 $ 3,000,000 Eligible Subcontractors shall provide evidence of general liability insurance for off-site activities. Additional Insured Endorsement Form CG20100704 and CG20370704 or their equivalent), Waiver of subrogation and Primary and Non-Contributory endorsements required. Physical Copies of Endorsement Required. Excluded Subcontractors shall provide evidence of general liability insurance applicable to on-site and off-site activities.. Coverage is required to be on an Occurrence form and shall apply to bodily injury and property damage for operations (including explosion, collapse and underground coverage), independent contractors, products and completed operations. Limits can be provided by a combination of a primary Commercial General Liability policy and Excess or Umbrella Liability policy. Please refer to your Subcontract Agreement for any clarification. Excluded Parties CERTIFICATE OF INSURANCE: Prior to mobilization and within three (3) days of renewal, change or replacement of coverage, Subcontractors will submit to Alliant a Certificate of Insurance evidencing the coverage and limits as specified in this section. A 30-day notice of cancellation provision and waiver of subrogation is required on all Certificates. Alliant Version 01 11

SUBCONTRACTOR REQUIRED COVERAGE Automobile Liability Commercial Business Auto Policy covering all owned, hired and non-owned automobiles, trucks and trailers is required, with coverage limits not less than $1,000,000 Combined Single Limit each accident for Bodily Injury and Property Damage. Coverage will apply both on and away from the Project Site. All lower tier Subcontractors shall also be required to maintain limits of not less than $1,000,000 Combined Single Limit. All Subcontractors shall provide evidence of automobile liability. The CCIP does not cover automobile liability. Property Insurance Subcontractors are advised to arrange their own insurance for owned and leased equipment and materials, whether such equipment is located at a Project Site or in transit. Subcontractors are solely responsible for any loss or damage to their personal property including, without limitation, property or materials created or provided under the Contract until installed at the Project Site, contractor tools and equipment, scaffolding and temporary structures, whether owned, used, leased or rented by contractor. Bernard s CCIP does not cover subcontractor s property. Watercraft and Aircraft Liability The operator of any watercraft or aircraft of any kind must maintain liability naming the Owner, Bernards and the respective Contractor and/or Subcontractor as an additional insured with primary and non-contributory wording. In addition, the limit of liability must be satisfactory to Bernards. Such insurance requirements will be determined as the need arises. Professional Liability All professional service firms must provide professional liability insurance appropriate for their profession. Architect and engineering firms must provide insurance covering liability arising out of design errors and omissions with a limit as specified in the Contract. The Bernards CCIP does not provide professional liability insurance. Pollution Liability Hazard remediation and demolition Contractors and Subcontractors whose Work involves removal or treatment of hazardous materials are required to provide and maintain Contractors Pollution Liability insurance that will be primary and noncontributory to any pollution coverage provided under the Bernards CCIP. Such coverage will specifically schedule the type of work defined in the Contract. Bernards will determine limits based on the nature of the contract and the risk involved. NOTE: Waivers Required. Contractor Workers Compensation, General Liability, Umbrella or Excess Liability and Property insurers shall provide Waivers of Subrogation in favor of Owner and other designated parties. Alliant Version 01 12

SUBCONTRACTOR RESPONSIBILITIES SECTION 5 5.1 SUBCONTRACTOR RESPONSIBILITIES The Subcontractor is required to cooperate with Bernards and its CCIP Administrator in all aspects of CCIP operation and administration. Responsibilities of Subcontractors of all tiers include the following: Enrollment in the CCIP, if eligible Complying with Insurance Credit procedures designed to remove the cost of CCIP provided Insurance from its price for work to Bernards Providing each lower tier Subcontractor with a copy of the Insurance Manual and Project Safety Standards Reviewing and understanding coverages, exclusions, and limitations of CCIP policies Including CCIP provisions in all subcontracts as appropriate Providing timely evidence of insurance to the CCIP Administrator (Alliant) Notifying the CCIP Administrator (Alliant) of all subcontracts awarded Cooperating with the CCIP Administrator s requests for information Complying with insurance, claim and safety procedures Notifying the CCIP Administrator (Alliant) immediately of any insurance renewal, cancellation, or non renewal (Contractor-required insurance) Promptly Paying General Liability or Builders Risk Obligations Assisting with lower tier Subcontractor compliance with all CCIP requirements Monitoring its lower tier Subcontractor's Certificates of Insurance 5.1 Subcontractor Bids Subcontractor bids shall include costs for insurance that Bernards will provide to all eligible and Enrolled Subcontractors under the CCIP for Work performed at the Project Site, as outlined in Section 3 of this Insurance Manual. The paragraphs below, Adjustments for Insurance Costs describes the procedures for identifying "on-site" ((Project Name) site) project insurance costs, and how you must account for these insurance costs. The CCIP Administrator can also help with your estimate, as well as provide assistance to your own insurance representative to ensure your insurance carriers do not charge for coverage provided under the Bernards CCIP. Alliant Version 01 13

SUBCONTRACTOR RESPONSIBILITIES 5.2 Calculation of Insurance Credits Overview Adjustments for Subcontractor insurance cost avoidance ( Insurance Credits ), shall reflect the Subcontractor s and Sub-subcontractors total cost of risk for insurance of the types provided by the CCIP. Cost of risk includes, without limitation, Subcontractor s actual insurance company premium rates and claim costs rates (including, without limitation, loss adjustment costs) within deductibles or self-insured retentions. 1. The Insurance Credit will be in the form of a percentage (taken at two decimal places) that Subcontractor shall deduct from its invoices to Bernards. a) In the event of a claim covered by the Program involving Subcontractor and/or any entity for which Subcontractor is responsible, Subcontractor shall pay Contractor a deductible based on amount agreed to in the subcontract. Procedures At the time the subcontract bid is submitted and before the start of work at the Bernards Jobsite, Subcontractor shall provide the CCIP Administrator with, along with enrollment data, an estimate of Subcontractor s and its Sub-subcontractors costs of insurance for like kinds of coverages to be provided by the CCIP, by completing and submitting, and having its Sub-subcontractors complete and submit, the Enrollment form. In order to verify the Insurance Credit and/or Insurance Credit rate and any subsequent Insurance Credit(s), Subcontractor and each of its Sub-subcontractors shall submit all documentation reasonably requested by Bernards and/or CCIP Administrator in connection therewith, including, without limitation: 1. Copies of insurance policies declaration and rate schedule pages, 2. Deductible or retention pages, 3. If applicable, information on self-insured retention programs and documentation of the Total Cost of Risk in any self-insured program, including five (5) year actuarial studies and prior loss histories. The CCIP Administrator will review the insurance credit information and other data submitted by subcontractor for accuracy and make corrections if necessary. Alliant Version 01 14

SUBCONTRACTOR RESPONSIBILITIES Subcontractor is solely responsible for the recovery from its Sub-subcontractors of any and all Insurance Credits attributable to such Sub-subcontractors participation in the CCIP. Subcontractor hereby represents and covenants that all insurance cost information submitted to Bernards or to the CCIP Administrator to calculate any Insurance Credit is or shall be accurate and complete. Subcontractor further agrees that Bernards is entitled to and may collect, from time to time, additional Insurance Credits resulting from any scope changes, additional work, and inaccurate assumptions in the initial Credit, or from information discovered during any audits which justify the taking of additional Insurance Credits. The procedures for collecting additional Credits and the development of a composite rate formula are addressed in the CCIP Insurance Manual and shall apply to each enrolled Subcontractor and Sub-subcontractor. 5.3 Enrollment Each Subcontractor shall provide details about its lower tier Subcontractors as necessary to enroll them in the CCIP. Bernards will need all of the information requested Enrollment Application. This information must be completed and submitted to the CCIP Administrator prior to mobilization. A separate Enrollment Application is required for each Eligible Subcontractor of any tier which performs Work at the Project Site. Each Enrolled Subcontractor will receive a Confirmation Letter via email. A Confirmation Letter is a letter issued by the CCIP Administrator that confirms acceptance of the applicant into the Bernards CCIP. NOTE: ENROLLMENT IS AUTOMATIC Enrollment into the Wrap-up is automatic at the time a subcontract agreement is signed; however, all Eligible Subcontractors of every tier MUST complete the enrollment forms and participate in the enrollment 5.4 Safety Guidelines Each Subcontractor is required to establish a written safety program and to provide a designated safety representative who is on site when any work is in progress. Minimum standards for subcontractor safety programs are outlined in The Bernards Project Safety Standards. Alliant Version 01 15

SUBCONTRACTOR RESPONSIBILITIES 5.5 Assignment of Return Premiums The cost of the CCIP insurance coverage is paid by Bernards. Bernards will be the sole recipient of any return CCIP premiums or dividends. All Enrolled Subcontractors will assign, to Bernards, all adjustments, refunds, premium discounts, dividends, credits or any other monies due from the CCIP insurer(s). Subcontractors will assure that each Enrolled lower tier Subcontractor has executed such an assignment. The Online Enrollment Application will be used for this purpose. 5.6 Change Order Procedures Change orders will also be priced by the Subcontractor and its lower tier Subcontractors to include in their change order bid, the cost of insurance for the coverages that are provided by Bernards. Procedures as outlined in Adjustments for Insurance Costs will also apply to change orders. The Insurance Credit Rate will be applied to change order payments. 5.7 Close-Out and Audit Procedures The Notice of Work Termination should be submitted when a Subcontractor or an associated lower tier Subcontractor has completed its Work at the Project site and no longer has on-site workers, and does not expect future work from Bernards. The Close- Out and Audit process with Bernards are expected to take no longer than thirty (30) days. Final payment will not be released by Bernards until all necessary forms have been submitted to the CCIP Administrator. Any penalties, for which the Subcontractor of any tier is responsible, will be considered at the time of close-out. Penalties will not be considered if previously reimbursed. Alliant Version 01 16

CLAIMS PROCEDURES 6.0 CLAIMS PROCEDURES SECTION 6 6.1 Liability Claims Accidents at or around the job site resulting in damage to property of others (other than your own work product), or personal injury or death to a member of the public, must be reported immediately to the CCIP Administrator. Complete and deliver the General Liability Loss Notice (Acord Form 3) to the CCIP Administrator within 24 hours of the incident. Do not voluntarily admit liability. Cooperate with the Owner or the CCIP insurer representatives in the accident investigation. In the event Bernards or a trade enrolled in the CCIP program receive a lawsuit involving construction defect or related allegations that relates to the construction project with which they are enrolled the original document along with any service of suit documents should be sent to: Alliant Insurance Services 333 South Hope Suite 3750 Los Angeles, CA 90071 Attn: Bob Dixon Enrolled Subcontractors shall be responsible at their own expense for the same deductible or self-insured retention amount applicable to their conventional (non-ccip) general liability policy, subject to a minimum of $5,000 per claim. Contractors and Subcontractors shall be solely responsible for obtaining reimbursement for the cost of the deductible of each occurrence including court costs, attorney fees and costs of defense for bodily injury or property damage to the extent losses payable are attributable to a Subcontractor s acts or omissions from the Subcontractor. Bernards reserves the right to increase Contractor and Subcontractor deductible based on Contractor and/or Subcontractor claim activity during the CCIP term. Alliant Version 01 17

CLAIMS PROCEDURES 6.2 Property and Builder s Risk Claims No coverage is provided for Subcontractor s property, including materials until installed under the CCIP. It is the sole responsibility of each Subcontractor and lower tier Subcontractor to insure and report accidents/claims involving their property to their own insurers. HOWEVER, all accidents occurring in or around the job site must be reported to the CCIP Administrator, and your property insurer. 6.3 Automobile Claims No coverage is provided for automobile accidents under the CCIP. It is the sole responsibility of each Subcontractor to report accidents/claims involving their automobiles to their own insurers. HOWEVER, all accidents occurring in or around the job site must be reported to the CCIP Administrator. Accident investigations will occur and focus on liability arising out of the project construction activities that could result in future claims (i.e. due to the conditions of the roads, etc.). Each Subcontractor shall cooperate in the investigation of all automobile accidents. 6.4 Pollution Claims Contractors and Subcontractors performing environmental remediation work are required to carry Contractor s Pollution Liability insurance that is primary and noncontributory to any coverage under the Bernards CCIP. All parties should report claims by immediately notifying the CCIP Administrator of any known or suspected pollution incidents. Alliant Version 01 18

PROJECT FORMS 7.1 PROJECT FORMS SECTION 7 Contractor Enrollment Form Notice of Subcontract Award Sample Certificate of Insurance Notice of Work Termination Notify CCIP Administrator Alliant Version 01