Workers Compensation and Statutory Disability

Each state has its own requirements for workers’ compensation insurance and employer’s liability if employees are hired and under the control and direction of the landlord.  This rule may even apply to independent contractors hired by the management of the building if it is determined there is vicarious liability due to the nature of worker delegated and/or performed by the contractors.  It is important to check with the department of labor in the various states as well as the Office of Consumer Affairs in the local community to check if independent contractors are required to carry their own coverage and to what extent.  If so, it may be important to list the landlord or building owner as an additional insured with respect to any liability claims.  Contracts between the parties protecting the rights of each can also prevent confusion in the event of a claim.  Language that addresses rights of subrogation, disclaimers of liabilities, hold harmless clauses, etc. often make up the language that can clearly identify which insurance responds in the event of a claim and how the process of a claim should take place.  Hence, it is highly recommended that a competent attorney review and/or draft these contracts before executive by the parties.

Statutory Disability Insurance is only mandated in a handful of states.  Often called DBL policies, coverage is afforded to those employees injured by sickness or illness that is not employment related.  The remuneration is determined by the level of pay if the employee was actively at work.  The duration of payment generally lasts no longer than six months and often has a deductible of one week for hospitalizations. Please check the policy for the terms and conditions and whether your state requires workers’ compensation and/or statutory liability.  Read More>>


* The above article is intended as a tool to assist in the evaluation of coverage and offer a method to determine if certain exposures may have been overlooked and should be filled.  If is not intended to offer advise which coverage to offer or suggest any levels of coverage. Please read the terms and conditions as well as the exclusions and the coverage forms before making you own determinations.  It is recommended that an independent appraiser be hired to assess the value of the property, qualified legal council hired to review the contracts, work orders, and lease agreements, and that a competent agent or broker be used to sought our carriers that can package the necessary coverage at affordable prices while maintaining their financial stability.  

By William F. Schaake, CIC, CRM © 2011-2012 All rights reserved