RCAC Home Page > News and Publications > Self-Help Builder Newsletter June 2013 Volume 6, Issue # 2 >

Dear Sher,

At a recent meeting, I had an insurance agent tell me we should carry medical expense coverage for the homeowners/client and carry construction management insurance, does that sound right and what are these insurance policies?

Sincerely, Bamboozled by the insurance man

Dear Bamboozled,

Being told you have inadequate insurance is disconcerting. In order to address your question, I asked Andy Oldenburg of PayneWest Insurance who is a friend to the program and who provides insurance to some western self-help grantees. Here’s Andy’s answer:

“Carrying only a standard general liability policy may not provide grantees of the 523 program with the insurance coverage they want. They need to get construction management insurance to be covered correctly for work at the jobsites. Supervising construction for a fee is a professional activity and professional services are excluded from 90 percent of general liability policies. If your general liability policy has the professional services exclusion, you need to additionally buy a form of errors and omissions insurance for construction managers. The good news is that the right agent will use the fact you have construction management insurance to lower your general liability premiums and you will end up paying about the same price for a lot more coverage. I don’t think a lot of insurance agents take the time to understand the program well enough to advise grantees correctly on this issue.”

Medical expense coverage for the families is a different issue. If healthcare reform goals are reached, these clients will be covered under Medicaid/Medicare or they will be able to purchase their own coverage as of Jan. 1, 2014. Here are Andy’s thoughts about medical expense coverage:

“I have spent a great deal of time researching the insurance needs for a client in the 523 program. One of the major issues was finding a policy that provides $10,000 of medical expense coverage for the homeowners/clients in the 523 program. Once I did, the policy only cost $310 per year. Trying to cover an injury on the job site was a big issue with my client and with this policy it’s so inexpensive it is almost foolish not to carry it.”

Here’s to being bamboozled no more!

Sincerely, Sher

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