For contractors operating in New York, few risks are as financially dangerous—and as widely misunderstood—as “action over” claims. These claims arise when an injured worker sues a third party (such as a property owner or general contractor), and that third party then brings a claim back against the injured worker’s employer. The result is a potentially catastrophic liability scenario that many contractors assume is covered under their Commercial General Liability (CGL) policy—only to find out too late that it may not be.

Understanding how action over claims work, and more importantly, how your CGL policy responds (or fails to respond), is critical for any contractor working in New York.

---

What Is an Action Over Claim?

Under normal circumstances, when an employee is injured on the job, their exclusive remedy against their employer is workers’ compensation. This system is designed to prevent lawsuits against employers while ensuring injured workers receive medical care and lost wage benefits.

However, New York’s Labor Law—particularly Sections 240(1) and 241(6)—creates a unique exception. These statutes impose strict liability on property owners and general contractors for gravity-related injuries and violations of the Industrial Code.

Here’s where action over comes into play:

1. An employee of a subcontractor is injured on a job site.
2. The injured worker sues the property owner and/or general contractor under Labor Law.
3. The owner or GC then files a third-party claim (an “action over”) against the subcontractor (the injured worker’s employer), seeking indemnification or contribution.

This effectively bypasses the workers’ compensation shield and pulls the employer back into the lawsuit—often for substantial damages.

---

Why Action Over Claims Are So Dangerous

Action over claims can lead to extremely high settlements or verdicts because:

• Labor Law 240(1) imposes absolute liability in many cases
• Comparative negligence is often not a defense
• Claims frequently involve severe injuries (falls from heights, falling objects, etc.)
• Indemnification agreements may require the subcontractor to assume full responsibility

For subcontractors, this means they could be responsible not only for their employee’s injury but also for the legal liability of the owner and general contractor.

---

The Misconception: “My CGL Covers This”

Many contractors believe their CGL policy will step in to defend and indemnify them in an action over claim. While this may have been true in older or more comprehensive policies, modern underwriting—especially in New York—has significantly changed the landscape.

Today, many CGL policies include specific exclusions or endorsements that limit or eliminate coverage for exactly this type of exposure.

---

Common Policy Exclusions That Block Coverage

1. Action Over Exclusions

Some policies explicitly exclude coverage for claims arising out of bodily injury to an employee where a third party seeks indemnification or contribution. This directly targets action over scenarios.

2. Employee Injury Exclusions (Expanded Definitions)

Modern policies often broaden the definition of “employee” to include:

• Subcontractor employees
• Independent contractors
• Leased or temporary workers

This means that even if the injured worker is not your direct employee, coverage may still be excluded.

3. Labor Law Exclusions

Certain carriers add endorsements excluding claims arising under New York Labor Law Sections 240 and 241 entirely. This removes coverage for the very statutes most commonly associated with action over claims.

4. Height Limitations

Policies may exclude work above a certain height (e.g., 10 or 15 feet). Since many Labor Law claims involve elevation-related risks, this can effectively eliminate coverage for common job site exposures.

5. Contractual Liability Limitations

If your indemnification agreement requires you to assume liability for a third party, but your policy restricts contractual liability coverage, you may be left uninsured for those obligations.

---

Real-World Scenario

Consider a drywall subcontractor working on a mid-rise residential project. One of their employees falls from a scaffold and suffers serious injuries. The worker sues the general contractor and property owner under Labor Law 240(1).

The GC then files an action over claim against the drywall subcontractor, citing the indemnification clause in their contract.

The subcontractor turns to their CGL carrier—only to discover:

• Their policy includes an action over exclusion
• The employee injury exclusion applies to subcontractor employees
• There is a height limitation of 15 feet

The result? No coverage. The subcontractor is forced to defend the claim and potentially pay damages out of pocket.

---

Why Certificates of Insurance Are Not Enough

Many contractors rely heavily on certificates of insurance as proof of coverage. However, certificates do not reveal critical exclusions or endorsements.

A certificate may show:

• $1,000,000 per occurrence limit
• Additional insured status
• Waiver of subrogation

But it will not disclose:

• Action over exclusions
• Labor Law limitations
• Employee injury carve-outs

This creates a false sense of security that can be devastating when a claim occurs.

---

Risk Transfer Alone Won’t Save You

While transferring risk through contracts and requiring subcontractors to carry insurance is essential, it is not sufficient on its own.

If:

• The subcontractor’s policy excludes action over claims, or
• The limits are inadequate, or
• The carrier denies coverage

…the financial exposure can shift back to you.

Proper protection requires alignment between contracts and actual policy language, not just certificates.

---

How Contractors Can Protect Themselves

To avoid being caught uninsured in an action over claim, contractors should take a proactive approach:

1. Review Policy Endorsements Carefully

Do not rely on summaries. Obtain and review full policy forms, especially exclusions related to:

• Employee injury
• Action over
• Labor Law

2. Work With Specialized Brokers

New York construction risks require deep expertise. A knowledgeable broker can identify problematic endorsements and negotiate better terms.

3. Align Contracts With Coverage

Ensure your indemnification agreements are supported by your insurance policy. Otherwise, you may be assuming liabilities your policy won’t cover.

4. Require Strong Subcontractor Coverage

Verify that subcontractors carry:

• No action over exclusions
• Adequate limits
• Proper additional insured endorsements

5. Consider Excess/Umbrella Policies

Even when coverage exists, Labor Law claims can exceed primary limits quickly. Excess coverage provides an additional layer of protection.

---

Final Thoughts

Action over claims represent one of the most significant uninsured exposures facing New York contractors today. The combination of strict Labor Law liability and increasingly restrictive CGL policy language creates a dangerous gap that many contractors do not discover until it is too late.

The key takeaway is simple: not all CGL policies are created equal. Understanding the exclusions and endorsements in your policy is just as important as knowing your coverage limits.

Contractors who take the time to properly structure their insurance programs—and work with professionals who understand the nuances of New York Labor Law—can avoid devastating financial consequences and operate with greater confidence.

---

**BGES Group is a leading Construction Insurance specialist serving New York, New Jersey, and Connecticut. We represent over 25 top-rated insurance carriers, providing access to the best general liability and umbrella liability programs available. Our comprehensive coverage options include property, builders’ risk, inland marine, general liability, umbrella liability, commercial auto, bid and performance bonds, workers’ compensation, New York State disability, and group health. Beyond offering policies, we pride ourselves on being highly accessible—by call, text, or email—even on weekends—so you always have a trusted partner to help you navigate any insurance challenge. We are also Workers’ Compensation specialists for tri-state business owners. Whether you are dealing with high premiums, policy cancellations, difficulty obtaining coverage due to losses, audit disputes, or payroll misclassification issues, we can help. We offer specialized programs for industries including auto services, contractors (especially in New York), limousine services, logistics companies, manufacturers, recyclers, and trucking operations. As a “Preferred Agent” for a select workers’ compensation program, we can often secure highly competitive pricing, long-term stability, and multi-state coverage for qualified clients—while also simplifying the audit process and reducing the burden of annual audits.

Contact Us: Gary Wallach Phone: 914-806-5853 (Direct)

Email: bgesgroup@gmail.com

Website: www.bgesgroup.com

Office Location: 216A Larchmont Acres West Larchmont, NY 10538

Navigating the world of workers’ compensation insurance can be daunting, especially for roofers in New York, where the legal requirements and risks are significant. This guide will walk you through the essential steps to ensure you have the right coverage for your business.

Understand New York’s Workers’ Compensation Requirements

In New York, having a comprehensive understanding of the workers’ compensation requirements is pivotal for your roofing business. State law mandates that all businesses with employees must have workers’ compensation insurance, and this includes roofers. Exceptions are rare, so it’s wise to familiarize yourself with who must be covered to avoid penalties.

The process of comprehending these requirements can be streamlined by consulting with experts who have hands-on experience with New York’s specific regulations. This ensures total compliance with the local laws while safeguarding your business from potential legal issues.

Assess the Risks Associated with Roofing

Given the nature of roofing work, which involves high elevations and potentially dangerous equipment, it is prone to a higher incidence of workplace injuries. It’s crucial to identify these risks and evaluate them thoroughly so your insurance policy can adequately mitigate potential liabilities.

By identifying these risks early on, you can introduce preventive measures and training programs to minimize accidents, which may also result in favorable insurance premiums in the long run.

Choose the Right Insurance Provider

Selecting an insurance provider is not just about pricing; it’s about finding a company that offers a robust support system. Working with insurers known for their customer service and straightforward claims process can make all the difference when dealing with an incident.

A good provider will not only offer comprehensive workers’ compensation insurance for roofers but will also ensure that the coverage aligns with your specific business needs. This tailored service guarantees you get the best value for your investment.

Tailor Your Policy to Your Business Needs

No two roofing companies are alike. Whether you specialize in commercial, residential, or industrial roofing, your insurance needs will vary. By tailoring your insurance policy, you ensure that your unique risks are covered, providing peace of mind to you and your employees.

Collaborate with your insurance provider to craft a policy that considers your business’s specific operational scope and risk factors. This approach not only offers adequate protection but also potentially reduces unnecessary costs from overlapping coverages.

Regularly Review and Update Your Coverage

Over time, your business dynamics will change. Whether it’s an expansion of services or a shift in the number of employees, ensuring that you regularly update your insurance policy is crucial. This diligence keeps you compliant with evolving laws and fully protected against new risks.

Frequent reviews with your insurer not only safeguard your business but also adapt your coverage to new challenges and opportunities that arise in the ever-changing landscape of roofing.

Final Thoughts on Workers’ Compensation Insurance for Roofers

Securing the right workers’ compensation insurance coverage in New York is an essential step to protecting both your employees and your business. By understanding the requirements, choosing the right policy, and working with an expert, you can ensure peace of mind while focusing on what you do best—providing excellent roofing services.

BGES Group is a leading Construction Insurance specialist serving New York, New Jersey, and Connecticut. We represent over 25 top-rated insurance carriers, providing access to the best general liability and umbrella liability programs available. Our comprehensive coverage options include property, builders’ risk, inland marine, general liability, umbrella liability, commercial auto, bid and performance bonds, workers’ compensation, New York State disability, and group health. Beyond offering policies, we pride ourselves on being highly accessible—by call, text, or email—even on weekends—so you always have a trusted partner to help you navigate any insurance challenge.

We are also Workers’ Compensation specialists for tri-state business owners. Whether you are dealing with high premiums, policy cancellations, difficulty obtaining coverage due to losses, audit disputes, or payroll misclassification issues, we can help. We offer specialized programs for industries including auto services, contractors (especially in New York), limousine services, logistics companies, manufacturers, recyclers, and trucking operations. As a “Preferred Agent” for a select workers’ compensation program, we can often secure highly competitive pricing, long-term stability, and multi-state coverage for qualified clients—while also simplifying the audit process and reducing the burden of annual audits.

Contact Us:
Gary Wallach
Phone: 914-806-5853 (Direct)
Email: bgesgroup@gmail.com

Website: www.bgesgroup.com

When most New York contractors think about Labor Law exposure, their minds immediately go to falls and the well-known “Scaffold Law.” But there’s another statute quietly driving a significant number of claims—and it’s often misunderstood until it’s too late: New York Labor Law § 241(6).

Unlike other Labor Law provisions, Section 241(6) introduces a unique and dangerous layer of liability tied directly to compliance with the New York Industrial Code. For contractors, this means that even minor safety violations can become the foundation for major lawsuits.

What Makes Labor Law 241(6) Different?

At its core, Labor Law 241(6) requires that construction, excavation, and demolition work areas be constructed, operated, and maintained in a way that provides “reasonable and adequate protection and safety” to workers.

However, what makes this law particularly challenging is that liability is not based on general safety standards—it is based on specific violations of the New York Industrial Code.

In other words, a plaintiff must point to a precise regulation that was violated. But once they do, the case can quickly become difficult to defend.

The Role of the Industrial Code

The New York Industrial Code is a detailed set of safety regulations covering nearly every aspect of construction operations. These rules address everything from ladder placement and scaffold construction to housekeeping and debris removal.

Some of the most commonly cited sections include:

• Improper ladder use or unsecured ladders
• Slippery or obstructed work surfaces
• Inadequate fall protection
• Unsafe equipment operation
• Poor housekeeping practices

The reality is that most job sites—especially fast-moving ones—have technical violations at some point. Under Labor Law 241(6), those small issues can become the basis of a claim.

Not Absolute Liability—But Close Enough

Unlike New York Labor Law § 240, which imposes absolute liability, Labor Law 241(6) is considered a comparative negligence statute.

This means that:

• A contractor or owner can argue that the injured worker was partially at fault
• Damages may be reduced based on the worker’s percentage of fault

However, this does not eliminate exposure. Even if a worker is found 50% responsible, the contractor or owner can still be liable for the remaining 50% of damages—which can be substantial in serious injury cases.

Who Is Liable?

Labor Law 241(6) applies primarily to:

• Property owners
• General contractors
• Construction managers (in certain cases)

Subcontractors are typically not directly liable under this statute unless they have been delegated authority over the work or safety conditions.

This creates a familiar and frustrating situation: the parties least involved in the actual work are often the ones facing the lawsuit.

Why This Law Is Frequently Overlooked

Many contractors focus heavily on fall protection due to Labor Law 240 but underestimate the reach of 241(6). That’s a mistake.

Here’s why this law flies under the radar:

• It requires knowledge of specific Industrial Code sections
• Violations can seem minor or technical
• It doesn’t sound as severe as “absolute liability”
• It often gets added to lawsuits alongside other claims

Yet in practice, 241(6) claims are extremely common and can significantly increase the complexity and cost of litigation.

Insurance Implications: Where Things Get Complicated

From an insurance standpoint, Labor Law 241(6) claims can trigger multiple policies and layers of coverage.

Key considerations include:

General Liability Coverage

Most claims are initially handled under general liability policies. However, coverage depends on:

• Proper classification of work
• Absence of restrictive exclusions
• Correct policy wording

Some carriers have tightened underwriting guidelines around New York construction risks, making coverage more difficult to secure.

Additional Insured Coverage

If subcontractors are involved, upstream parties rely heavily on additional insured status.

But here’s the catch:
If the subcontractor did not violate the Industrial Code—or if their policy is not properly structured—coverage disputes can arise quickly.

Excess and Umbrella Policies

Given the severity of potential injuries, excess and umbrella policies are often triggered. However, inconsistencies between underlying and excess policies can create gaps in coverage.

Real-World Claim Scenarios

To understand how Labor Law 241(6) plays out, consider these common examples:

• A worker slips on debris left in a walkway—triggering a housekeeping violation
• A ladder shifts because it was not properly secured—leading to a fall
• Tools are improperly stored, creating a tripping hazard
• A worker is injured due to inadequate lighting in a work area

In each case, the injury may not involve a dramatic fall from height—but a specific Industrial Code violation can still create liability.

How Contractors Can Protect Themselves

While Labor Law 241(6) cannot be avoided, its impact can be managed with the right approach.

1. Strengthen Job Site Safety Practices

Strict adherence to Industrial Code requirements is critical. This includes:

• Regular site inspections
• Clear housekeeping protocols
• Proper equipment setup and maintenance

2. Implement Strong Subcontractor Controls

Subcontractors should be required to:

• Follow all safety regulations
• Maintain proper insurance coverage
• Agree to indemnification provisions

3. Verify Insurance Coverage Thoroughly

Do not rely on certificates alone. Review:

• Policy endorsements
• Additional insured language
• Exclusions related to Labor Law claims

4. Work with Specialized Advisors

New York construction risks require expertise. Contractors benefit from working with professionals who understand how Labor Law claims are litigated and insured.

Final Thoughts

Labor Law 241(6) may not get the same attention as other statutes, but it is a powerful and frequently used tool in construction litigation. Its reliance on specific Industrial Code violations makes it both technical and dangerous for contractors who are not fully prepared.

In New York, where the legal environment is already challenging, overlooking this law can lead to significant financial exposure. The key is awareness, preparation, and a disciplined approach to both safety and risk transfer.

---

BGES Group is a leading Construction Insurance specialist serving New York, New Jersey, and Connecticut. We represent over 25 top-rated insurance carriers, providing access to the best general liability and umbrella liability programs available. Our comprehensive coverage options include property, builders’ risk, inland marine, general liability, umbrella liability, commercial auto, bid and performance bonds, workers’ compensation, New York State disability, and group health. Beyond offering policies, we pride ourselves on being highly accessible—by call, text, or email—even on weekends—so you always have a trusted partner to help you navigate any insurance challenge.

We are also Workers’ Compensation specialists for tri-state business owners. Whether you are dealing with high premiums, policy cancellations, difficulty obtaining coverage due to losses, audit disputes, or payroll misclassification issues, we can help. We offer specialized programs for industries including auto services, contractors (especially in New York), limousine services, logistics companies, manufacturers, recyclers, and trucking operations. As a “Preferred Agent” for a select workers’ compensation program, we can often secure highly competitive pricing, long-term stability, and multi-state coverage for qualified clients—while also simplifying the audit process and reducing the burden of annual audits.

Contact Us:
Gary Wallach
Phone: 914-806-5853 (Direct)
Email: bgesgroup@gmail.com
Website: www.bgesgroup.com

Office Location:
216A Larchmont Acres West
Larchmont, NY 10538

Navigating the world of insurance can often feel daunting, especially for contractors who need to continuously assess risk while staying protected from potential liabilities. Professional liability insurance is a crucial component of this safety net, and understanding its nuances can safeguard your business effectively. In this post, we aim to break down the key aspects of professional liability insurance, tailored specifically for contractors.

Understanding Professional Liability Insurance

Professional liability insurance, often known as errors and omissions insurance, is designed to protect contractors or businesses from claims of inadequate work or negligent actions. It’s essential for anyone whose or business undertakings could potentially result in a lawsuit.

At the core of professional liability insurance is the concept of protection against claims stemming from professional errors, malpractice, or misrepresentation. Contractors, in particular, operate in sectors where mistakes can have significant repercussions, sometimes leading to costly legal battles. Coverage typically includes legal defense costs, settlements, or judgments, ensuring that such financial burdens do not derail your operations. The policy is especially crucial for those involved in the construction, design, or consultancy sectors, where projects are complex, regulations are strict, and the margin for error is slim.

Understanding the distinction between general liability and professional liability insurance is vital. While the former covers physical damages and personal injury, professional liability zeroes in on financial harm due to professional faults. As professionals are held to industry standards, failure to meet these expectations can lead to significant claims. This policy acts as a safeguard, underpinning the importance of quality, responsibility, and precision in every project.

Why Contractors Need It

Contractors uniquely operate in environments where even a slight error can result in significant financial loss. Professional liability insurance is a safety net that ensures you or your business are protected against such situations, preserving both finances and reputation.

The nature of contracting work involves an inherent level of risk, with unforeseen events potentially leading to disputes, claims, or lawsuits. A missed deadline, a design flaw, or even a misunderstanding with a client can escalate into a costly legal issue. Professional liability insurance provides a buffer against these risks, offering peace of mind and the ability to focus on delivering quality work. For many contractors, this insurance is not just a precaution but a foundational element of their business strategy, ensuring that operations can continue uninterrupted even in the face of potential litigation.

Key Coverage Features to Consider

When evaluating insurance policies, contractors should particularly look out for elements such as coverage limits, policy exclusions, and whether defense costs are included. These features will directly impact the policy’s effectiveness in protecting your business.

In addition to the basic essentials, contractors should consider customizable features that address specific needs unique to their operations. For example, some policies might offer crisis management support or coverage for subcontractors, enhancing the scope and effectiveness of the policy. Evaluating whether a policy covers prior acts is another crucial step, especially for those involved in long-term projects. Furthermore, considering the retroactive date, which covers services rendered prior to the policy’s commencement date, can be a strategic addition. By carefully analyzing these features, contractors can tailor their professional liability insurance policies to their specific requirements and operational scope.

Mistakes to Avoid When Choosing a Policy

Common pitfalls include underestimating coverage needs, overlooking exclusions, and not comparing multiple quotes. Avoiding these mistakes ensures that you select the best policy for your specific contracting needs.

Another frequent mistake is failing to continuously review and update the insurance policy in line with business growth or operational changes. As your contracting business expands or shifts focus, the risks you face may evolve, necessitating an adjustment in your coverage. Failing to do so could leave critical gaps in protection. Additionally, contractors should actively engage with their insurance advisors to understand intricate policy conditions, resolving ambiguities, and ensuring full comprehension of all terms. This proactive approach mitigates misunderstandings and enhances the policy’s protective capabilities.

Budgeting for Professional Liability Insurance

Cost is a critical consideration. By understanding factors that influence premium rates—such as the type of work you do and potential risks—you can set a realistic budget that ensures comprehensive protection without financial strain.

One of the primary influencers of insurance premiums is the nature and scope of the contracted work. High-risk industries or projects with significant complexity naturally attract higher insurance costs. However, by proactively managing risks and demonstrating a strong commitment to safety, contractors can often negotiate better rates. Implementing effective risk management strategies not only reduces potential hazards but also positions you as a lower risk in the eyes of insurers, which can lead to reduced premiums. Moreover, taking the time to shop around and compare different policy offers can yield significant cost savings over time.

Safeguarding Your Business with the Right Coverage

Well-informed choices regarding professional liability insurance can significantly reduce risks and provide peace of mind for contractors. By understanding what coverage you need, how policies work, and the potential costs and benefits, you can confidently protect your business against unexpected challenges. Make sure to consult with an insurance advisor to tailor a plan that fits your specific needs. Visit our homepage to learn more about how we can help protect your business.

BGES Group is a leading Construction Insurance specialist serving New York, New Jersey, and Connecticut. We represent over 25 top-rated insurance carriers, providing access to the best general liability and umbrella liability programs available. Our comprehensive coverage options include property, builders’ risk, inland marine, general liability, umbrella liability, commercial auto, bid and performance bonds, workers’ compensation, New York State disability, and group health. Beyond offering policies, we pride ourselves on being highly accessible—by call, text, or email—even on weekends—so you always have a trusted partner to help you navigate any insurance challenge.

We are also Workers’ Compensation specialists for tri-state business owners. Whether you are dealing with high premiums, policy cancellations, difficulty obtaining coverage due to losses, audit disputes, or payroll misclassification issues, we can help. We offer specialized programs for industries including auto services, contractors (especially in New York), limousine services, logistics companies, manufacturers, recyclers, and trucking operations. As a “Preferred Agent” for a select workers’ compensation program, we can often secure highly competitive pricing, long-term stability, and multi-state coverage for qualified clients—while also simplifying the audit process and reducing the burden of annual audits.

Contact Us:
Gary Wallach
Phone: 914-806-5853 (Direct)
Email: bgesgroup@gmail.com

Website: www.bgesgroup.com

Office Location:
216A Larchmont Acres West
Larchmont, NY 10538