Valley of the Sun, Phoenix, AZ

  • 1.  Being Charged for Insured Contractors on GL Audit

    Posted 03-28-2023 16:38

    Good afternoon, 

    I recently completed an audit for General Liability and noticed that I was being charged a premium for my "insured subcontractors", whom I collected and provided Certificates of Insurance for. It was my understanding that as long as I collected these Certificates of Insurance from my subcontractors, that I would not be charged a premium for them. Is this not the case? 

    Is Workers Compensation the same way? Does anybody know why, or if this is state law? Any feedback would be appreciated! Thank you. 



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    Miranda Geyer
    Welch Companies Inc
    Tempe AZ
    (480) 446-9700
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  • 2.  RE: Being Charged for Insured Contractors on GL Audit

    Posted 03-29-2023 11:31

    Hi Debbie, we just had a WC and GL audit as well. It depends on your policy but our policy is based on payroll and subcontract work. Our GL premium is charged a rate per dollar paid to every subcontractor and a separate rate for payroll based on position. 

    For WC if you provided certificates of insurance for your subs then no, you should not be charged for them. Under WC if you don't have a certificate the auditor basically looks at it as your covering your sub for their work comp. 

    I would look at your GL policy to see if the rate is based on gross sales or payroll/subcontract expense. Also please note, I am in no way an expert on this stuff! I just learned a lot about insurance in the last month by reviewing our audits. Hope this helps a little though!



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    Camille Darney
    Senior Accountant
    Service Direct Landscape
    Phoenix AZ
    (214) 585-1115
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  • 3.  RE: Being Charged for Insured Contractors on GL Audit

    Posted 03-31-2023 15:06

    Thank you so much for your response! 

    I do see in the GL policy that there is a section and rate for "Insured Subcontractors", which does not appear in our WC policy. I will contact our agent for further clarification. I am assuming the rate would be much higher if we did not collect the Certificates of Insurance. 

    Thanks again!



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    Debbie Welch
    President & CEO
    Welch Companies Inc
    Tempe AZ
    (480) 446-9700
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    Original Message


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