The Insurance Gap
The insurance exposures of a decal application company are very unique to its industry.
The installation and removal of the decals poses a very serious insurance gap. The question is who is responsible if damage is done to the substrate the installation/removal is performed on?
The intent of insurance is to cover exposures that are out of your control. Insurance excludes "your work".
Insurance will cover the ensuing damage from your work. However removing or installing a decal can in itself cause damage to a surface that the application or removal is being performed.
What if you did not know the pre-existing condition the surface was in when you were contracted to do a decal removal? The owner could accuse you of ruining the surface once the decal is removed. There would be defense cost involved to defend the allegation.
What if the surface was ruined when doing an application?
In both scenarios your insurance would not respond or only respond minimally. Some insurance carriers will include a very small limit for items in your care, custody and control. The limit is very small and would not begin to cover the extent of a claim for this exposure.
It is very important to execute a written contract that contains a clause to exclude liability for the possible damage to the object the work is being performed on whether for installation or removal.
If the contract is to remove an existing decal, it can state that it is impossible to determine the pre-existing condition of the surface that the work is being performed on and therefore all liability should be excluded. The fact that removing a decal could cause damage to the surface in and of itself should also be declared and the liability excluded.
Wording should also be added to reduce the liability for damages to the surface that a decal is being applied too. The use of chemicals, blades, and heat are necessary for your trade. At times, the environment and circumstances surrounding the project are less than optimal or unique. Perhaps, the risk for damage cannot be foreseen. Protecting your role in any project from liability for damages to the surface for which you are applying decals should be considered and addressed prior to minimize your exposure.
Login to the Members Area for a sample Terms & Condition contract which includes a liability disclaimer.
