SDV Insights

Some hot topics dominating the construction industry today include the impacts of COVID-19, government testing and vaccine mandates, cyber security, and the evolving role of general counsel.

In June 24, 2021, the Champlain Towers South in Surfside, Florida collapsed, killing nearly 100 individuals (the "Collapse"). As experts uncover more information regarding the cause of the Collapse, those individuals who have filed lawsuits as well as the potentially culpable defendants are looking to insurers for coverage of their bodily injury and property damage claims.

Nearly half of America's construction projects are now design-build in a continuing shift. As a result, contractors are taking on more professional liability ("PL") risk than ever before, and the risk management landscape is changing. There are unique challenges to managing PL risks and claims.

A new bill (SB 2022-736) was recently introduced to the Florida Senate. The proposed amendments to the statutes of limitations and repose could significantly impact construction defect claims by effectively creating additional exposure to contractors and insurance carriers. The proposed bill requires all actions founded on the design, planning, or construction of an improvement to real property to be commenced within four years after the time to commence an action begins.

First-party, third-party, builder's risk, professional liability, general liability, wrap-ups, and additional insured status are all potential sources of insurance coverage for a large construction loss.

A bill that would amend the the wage and hour requirements of the New York Labor Law was recently passed by the New York State Legislature and is expected to be signed by Governor Cuomo. Bill Number S2766C (the "Bill") is intended to protect construction workers against wage theft.

Recently, Theresa A. Guertin published a chapter in the 2021 Construction Law Update. This chapter provides an overview of indemnification agreements, the critical lines of insurance coverage most commonly purchased by construction industry players (builder's risk, commercial general liability (CGL), excess/umbrella, automobile liability, and workers' compensation), and some significant issues associated with each line of coverage.

David G. Jordan and Samantha M. Oliveira are regular contributors to the Construction Law Handbook, Chapter 17.

Under current New York law, contractors and design professionals have exposure to bodily injury and property damage claims resulting from construction defects for a potentially unlimited number of years after completion of a project. New York is considering legislation, which, if enacted, would create a statute of repose limiting the number of years after completion of construction that legal action may be asserted against a contractor.

Subcontractors sign contracts every day which require them to provide insurance for liabilities arising out of the performance of their work, but in New York in particular there is often a failure of risk transfer due to labor law or "Action Over" exclusions.