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Contractors and Insurance: How to Manage the Risk

By January 23, 2012April 15th, 2018General Updates

A worker sustains an injury on the job, now who will be held responsible?

Even if the worker is 100% at fault, property owners and contractors can be held liable.

While the best practice is to provide a safe work environment for workers, sometimes things don’t always go as planned. In this way, New York State Labor Law, Section 240, was created to impose a non-delegable duty upon owners and contractors to provide and enforce a safe environment for workers. The statute was specifically intended to protect workers by attaching absolute liability to property owners and contractors who failed to provide any safety devices, or where the safety device proved inadequate for a worker engaged in a task entailing significant risk because of an elevation differential.

In this way, a property owner or contractor can be held responsible for compensating an injured worker in the event that they sustain an injury, even if the worker is 100% at fault. Depending on the severity of the case, these judgements can amount to values between $250,000 to $1,000,000 and sometimes even higher! Mackoul & Associates, Inc., President, Edward J. Mackoul, CIC, has been quoted in The Cooperator, “The Coop and Condo Monthly,” saying that when you have people working in dangerous conditions, “it’s prudent to dot all the i’s and cross all the t’s.” To cover all areas, contractors should carry four forms of insurance: General Liability, Contractural Liability, Worker’s Compensation and Disability Coverage.

5 Ways You Can Manage The Risk

  • Never hire an uninsured contractor!
  • Ensure that your contractor maintains certain coverage:
    General Liability, Workers’ Comp, and Commercial Umbrella Policies
  • Follow specific guidelines when drafting the Certificate of Insurance and Contract
  • Be sure that the building owner and/or property manager is named as an additional insured on the contractors insurance policy
  • Maintain a Hold Harmless Agreement with the contractor in the property owners favor

We hope you’ve enjoyed today’s blog post and if you have any questions about your insurance, feel free to call Mackoul & Associates, Inc. at (516) 431-9100 or email at

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