色多多视频

Hiring, contracts, accidents, losses – liability within the marine subcontracting industry is rampant. As post-pandemic work demands increase, so does the likelihood that a subcontractor will experience loss.

There are plenty of factors that are feeding that particular beast. Labor shortages, lax hiring practices, and the rush to sign contracts have increased the claims activity for many subcontractors. With some due diligence at the outset, however, subcontractors can alleviate many loss exposures, even in a competitive market.
But first, they need to understand the exposures they face.

The Hiring Dilemma
The good news is that marine business activity is on a rebound. The slowdown of the last two years has eased. Work is both plentiful and in high demand. For marine subcontractors, that means the time to hire is now.

However, hiring in a tight labor market can create risks. The current labor shortages are well-documented across all industries. Finding qualified workers becomes harder, leading to heightened risks for shorthanded crews. Proper due diligence - background checks, physicals, and pre-screening processes to flag potential issues - is often times bypassed in order to fill empty positions. The quality of workers performing skilled labor jobs declines, and job site safety suffers in addition to the quality of workmanship.

The lack of hiring qualified workers manifests itself in claims activity. The most prevalent type of loss for marine liability pertains to bodily injury. From slip-and-fall injuries to workers to faulty workmanship allegations, claims are on the rise.

Contractual Obligations
Claims also result from not reading contracts before they’re signed. Too often, subcontractors find out later on that their contract, which they signed in order to win a job, transfers many inherent risk exposures solely onto them via action-over indemnification. In some instances, subcontractors know that they are accepting full exposure to secure the job, hoping there will not be a claim in the future.

For example, a shipyard will often require subcontractors that work on their premises to sign a contract which releases the shipyard from any liability arising from injury to the subcontractor’s employees. This would be an example of contractual liability because in the absence of such a contract, the shipyard would actually be legally liable for injuries to subcontractors’ employees if the shipyard was negligent in some way that caused or contributed to the injury. This example is a classic illustration of action-over indemnification in “action”.

Unfortunately, claim costs have been rising steadily with no sign of slowing down. Social inflation and nuclear jury verdicts have skyrocketed the amount that defendants pay. The push to settle claims, even those that should belong to another party, seems like a prudent option as opposed to pushing back legally on contract language.

We advise our policyholders to read every contract thoroughly and to consult with an attorney.

Adding Preventative Measures
We advise our policyholders to read every contract thoroughly and to consult with an attorney. Know the full ramifications of what you are signing. Let legal counsel guide you through the contract language and what it means to your operation.

What are you buying in the contract? What are you agreeing to? Are you agreeing to pick up someone else's negligence? Will any fault rest on your business’s shoulders?

Also, be aware of the settlement landscape in your jurisdiction. Where your business is located matters. Some jurisdictions have an aggressive jury awards history, which will impact the cost and extent of insurance coverage provided by your carrier.

That’s where smart risk management steps can reduce your organizations exposures. Look at your current hiring process. Are shortcuts being made in order to fill crew requirements? Conduct thorough background checks and physical screenings. Ensure your crew members are qualified to perform their job. Also, make sure you have enough workers for the job at hand. Working shorthanded exposes your operations to increased injury or death.

Review your safety procedures. What is your workplace culture and how do you embed safety into the workday? To prevent workplace injury, start by following basic workers compensation guidelines for preventing injury. Train your crew members properly. Provide appropriate equipment to protect your employees. Make sure that your employees work in tandem on more dangerous tasks.

For more help in understanding how to reduce your risks, work with an insurance carrier that specializes in marine insurance. AXA XL’s marine group has an expert team of underwriters, risk control specialists, and claims representatives who can help you minimize loss exposures. We can provide the expertise to bring your risks under control.

For those risks you can’t mitigate, 色多多视频Marine has a broad product offering to meet your contractual obligations and to protect your business from loss. Our understanding of your business means you get advice and products that fits your industry and your specific operations.

Even in tight labor markets and competitive work environments, your subcontracting business can thrive without compromise. Pay attention to hiring practices, contract language, and internal hiring and safety protocols. Through proper due diligence, you can reduce your organization’s exposures and avoid unnecessary losses.

About the Authors
Brett Musser is a Marine Underwriting Manager with AXA XL’s Americas Marine and Danielle Ortiz is our Marine Claims Manager.