Short answer
You can often tender a claim to subcontractor insurance when a defect claim involves work your subs performed. Send the claim to your subs in writing and ask them to notify their insurers. If your subcontract required additional insured status, you may also tender your defense to their general liability insurer. Pull the subcontracts and certificates first, and let your insurer and counsel send the formal letters.
Why does passing the claim down the chain matter?
Subcontract indemnity and additional insured coverage often shift some or all of the cost to whoever did the work. Many firms don’t realize that their subs’ insurance can carry much of a claim. Whether a policy responds depends on its wording and the facts.
Example: a hypothetical defect notice
A design-build firm receives a defect notice in Florida. The agent asks which subs did the concrete, waterproofing and lighting, so the notice can reach them and their insurers early.
In this hypothetical, the firm gathers its subcontracts and certificates and checks for additional insured endorsements. How each policy responds depends on its terms, exclusions and underwriting.
What should you gather before you tender?
- Subcontracts
- Certificates of insurance
- Additional insured endorsements
- The sub’s general liability policy periods
A certificate alone doesn’t prove additional insured status, so look for the endorsement itself.
What is the difference between tendering to the sub and to the sub’s insurer?
These are two different letters. One asks the subcontractor to defend and indemnify you under the subcontract. The other asks the subcontractor’s insurer to defend you as an additional insured. Your insurer or counsel usually sends them, so ask before sending anything yourself.
How are design consultants different?
An outside architect or engineer usually carries professional liability, which generally doesn’t offer additional insured status. The path there is notice and indemnity rather than additional insured coverage.
What is the Florida timing for forwarding a notice?
Under Florida’s chapter 558, forwarding a notice to subs has a 10-day window. Read Florida Statutes section 558.004 and confirm the timing with your attorney. The IRMI site offers general background on additional insured endorsements.
What to check
- Which subs and consultants worked on the part of the project the claim describes?
- Does each subcontract require additional insured status and indemnity?
- Does each sub’s policy carry the endorsement, and was it in force when the work was done?
- Has each sub been told in writing to notify its insurer?
- Has your own insurer been notified?
Questions to ask your attorney
- Which subs and consultants should receive notice, and by when?
- Does each subcontract’s indemnity apply to this claim?
- Who sends the tender letters, and has each recipient acknowledged them?
This article is general education, not legal advice. Hardcover is an insurance agency, not a law firm.
Related questions
Do we send this to our concrete and waterproofing subs too?
If the claim involves their work, usually yes. Ask your insurer or counsel who should receive it and how.
What does it mean to tender a claim?
To formally ask another party, or its insurer, to defend and indemnify you for a claim.
Can I be an additional insured on my sub’s policy?
Often, if the subcontract required it and the sub’s policy has the right endorsement. Check the endorsement, not just the certificate.
Can I be added to my architect’s professional liability?
Generally no. Professional liability doesn’t offer additional insured status. Rely on the contract’s indemnity and the architect’s own coverage.