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Within the wide range of liability insurance and its covers, there are several guarantees of vital importance for companies, especially those operating in construction, renovation or installation.
Remember that liability insurance is necessary for both companies and self-employed workers to cover damage caused while carrying out their work.
Companies can choose different covers, such as public liability, product liability, employer’s liability or tenant liability. Today, however, we focus on cross liability. What is it? Why is it necessary?
Cross Liability Cover
“Cross” cover in liability insurance is a normally optional guarantee under which, if arranged, the insurer may assume claims for possible bodily injury or material damage suffered by the employees of contractors or subcontractors.
Cross liability in a liability policy is understood as the cover that applies to the insured party for bodily injury suffered by employees of the insured party’s contractors and subcontractors.
Through this cover or guarantee, the status of “third party” is granted to subcontractor personnel involved in the execution of works for damage they may suffer in relation to the company, machinery or equipment of the insured party.
Examples of Cross Liability Cover
Imagine we are a construction company that subcontracts certain works to another company. If the employees of that other company cause damage to third parties, we would be talking about subsidiary liability. But if those employees are the ones who suffer the damage, we are talking about cross liability.
Avoiding Unnecessary Risk
Having insurance that covers these situations is very important for companies, because when damage occurs, indemnities can be very high.
Before putting the company’s financial or asset position at risk, it is important to have insurance that protects it without endangering the business or self-employed worker. This is the best way to increase security, avoid financial gaps and obtain strong protection.
In short, if your activity involves subcontracting certain works, you need to include cross liability cover in addition to subsidiary liability cover in order to avoid surprises in the event of a claim. If you would like to ask us any question, we are at your disposal.[/vc_column_text][/vc_column][/vc_row]