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Construction Liability
"Market Assistance Program" Established Nevada Insurance Commissioner Alice Molasky-Arman said May 4 that although there is evidence that Nevada’s insurance marketplace has been seriously affected by continuing construction defect litigation, she will not create an "essential insurance association" to provide coverage for contractors. What has been created is a Market Assistance Program that, according to Clifford King, Chief Insurance Examiner for Property/Casualty in the Division of Insurance, comes in two parts. The "clearinghouse" portion will provide insurance agents and contractors with help in finding carriers willing to underwrite problematic risks. That help would come in the form of advice about the market. King said that Kay Lockhart of the Nevada Independent Insurance Agents Association may serve as the point of contact for the clearinghouse. "The initial one that we are now creating is like a clearinghouse that will provide advice as to what companies (both admitted and surplus lines) are likely to write a particular risk," King said. "The agent or contractor can call her, and she’ll direct them as appropriate." Lockhart is also a member of the Nevada Surplus Lines Association, according to King, and therefore has knowledge of both admitted and non-admitted markets. The second part is more hands-on and is currently being formed. A manager, who has not yet been identified, will place risks with carriers who have agreed to participate. Insurance company participation is strictly voluntary, with carriers being asked at this time to sign up for the program. "In this program, a manager coordinates the placement of risks with those carriers that have volunteered to participate," King said. "The company organizations are in the process of getting commitments right now." King said if carriers fail to sign on, the Market Assistance Program will fail. The voluntary nature of the program means that some insureds may not be able to find coverage at any price. The Commissioner’s statement, acknowledging that the insurance market for contractors has dwindled thanks to adverse lawsuits, calls for legislative action as a cure for what ails Nevada’s construction liability marketplace. Steve Hill, chairman of the Coalition for Fairness in Construction, said his group is seeking changes in Nevada law that will allow builders to repair construction defects and decrease the number of frivolous or unwarranted suits. The Coalition also wants a definition of a "construction defect" and accountability for attorneys who file claims without merit. "Our goal is to restore common sense to our wildly litigious environment," he said. "People want their homes fixed and we want to fix them. Our current system does not allow this." |
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Call (702) 615-7644 |
