Worker comp policy

We are an association out of California. The board recently discovered we were paying a "workers comp policy". We asked our management company why we would have such a policy. Their response was "Well, if a worker we hire forgets to pay their premium the assocation would be covered" Make no sense. We cancelled it. Right??? Need some thoughts. I called our insurance carrier and they never have heard of anything like that.
Sandy

How much were you paying?

If it's not much, I'd leave it. If you have many companies that you hire, including sole propriortors or with a DBA, this could come in handy.

Sandy, it is a good idea for an HOA to consider having Workers' compensation insurance. What if a contractor fails to maintain their workers' comp or what if a contractor you hire ends up with a sub-contractor who does not have workers' comp and there is a serious accident? Your HOA could be found liable.

It was $600.00 a year. I agree with MaryA1. We hire a management company to make sure that all workers doing work on our property our fully insured and up to date. All of that should be reviewed before hiring them. If they get hurt, why would it be our fault? They do not work for us they work for a company. We do have liability insurance. I appreicate all the responses. The mamangement company is trying to convince us we made a mistake in cancelling the policy. I THINK NOT!!!!

Ask the subcontractor for Certificates of Insurance and keep them updated. It's my understanding that if there is an underlying exposure without a COI, that the insurance carrier might pick this up in an audit and then send you an interim audit billing based on the additional exposure that wasn't contemplated initially when the policy term started.

The only reason to have a workman's comp policy is for your own employee, a person on the HOA's payroll who you pay all the other employment taxes for, not an outside vendor who you have no direct control or responsibility for. You should require contractors to provide a copy of their business license and insurance certificate before you hire them and require the MC to keep them updated.

Look at the whole quote Kirk, if they get sued because the MC hires someone without proper insurance and they (the HOA) get sued then they're going to sue the MC. If their contract requires that the MC do a certain act i.e. only hire insured contractors and the MC deliberately doesn't do that or make a reasonable effort to insure that procedure is followed and a problem occurs then the indemnity clause wouldn't protect the MC.

Karen:

That is why the HOA should be particular about who it hires, if I were in Florida and a sole proprietor wanted to do work for me I would tell them to get workers comp insurance and show me proof. This is me as a homeowner, the HOA should do the same. If they want the job bad enough they will get it.

It's nice to see that we have so many licensed Insurance professional agents and so many attorneys here that know the worker's comp laws as they relate to different states.

JohnD14 - you are apparently new here. I would suggest that along with the posting guidelines, you also read the "General Legal Notice" at the bottom of every page in the forum. One of the first things that you should see there is "Messages posted by HOATalk or other members are for informational purposes only, are not legal or professional advice and do not constitute an attorney-client relationship."

Please keep in mind that this is a discussion forum and most things posted here are opinions based on experiences. If seeing somebody's opinion offends you, well there are always other forums.

Yes, and your advice is certainly worth the price that you pay for the poor advice. Too bad that most of you (not all) don't know what you're talking about.

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