The job of water and sewer districts are an essential part of most communities, especially since it would be difficult for most of us to imagine living without running water!
Because of the vast services they provide our communities, it only makes sense that water and sewer districts should be receiving the proper insurance coverage to ensure everything flows smoothly.
At Berry Insurance, we’re proud to partner with numerous water and sewer districts across New England for protecting them from issues and challenges they face.
If you’re looking for new insurance coverage, or want to know more about the process of insuring water and sewer districts, then keep reading to learn all about the required coverages, what goes into the quoting process, and what influences the cost of the insurance policy.
What insurance coverages do water and sewer districts need?
When working with water and sewer districts we typically include the following coverages:
Workers’ compensation:
Workers’ compensation covers employees' medical expenses and lost wages following a workplace injury or illness, while also protecting the water and sewer district with coverage from employee-related lawsuits.
This coverage is a legal requirement of almost all businesses and public entities in Massachusetts.
General liability:
General liability insurance provides coverage for the unique exposures of a water and sewer district's premises and operations. This can include coverage for the following:
- Injuries to someone else for an accident you cause
- Damages to someone else’s property
- Contractual liability (limited)
- Personal injury coverage
- Emergency medical payments (optional)
- Electronic data/cyber liability (optional)
- Employee benefits liability
- Watercraft
- Pollution
- Failure to supply water
Property:
Property insurance protects the water and sewer district’s physical assets - like buildings, water tanks, wells, treatment plants, furniture and equipment, supplies, computers/electronics, and outdoor structures. It provides financial reimbursement to help recover the cost of items damaged, lost or destroyed from fire, theft, vandalism, burst pipe, explosion, and more.
If you are contemplating adding any major renovations or additions to your property, you should consider adding a builders risk insurance policy. Builders risk insurance adds an individualized type of property insurance for buildings under construction or renovation. If you’re interested in learning what insurance carriers we’d recommend, then check out our article on the top 4 Massachusetts based insurance carriers for builders risk policies.
Commercial auto:
Any vehicles registered under your water and sewer district would need to be covered through a commercial auto policy.
A water and sewer district’s commercial auto policy will typically provide the following coverages:
- Liability for bodily injuries or property damages caused by your vehicle
- Physical damages to your vehicle
- Medical payments
- Coverage if you are involved in a hit-and-run
- Coverage if you are hit by an uninsured driver
- Hired auto liability for accidents caused with rented vehicles (optional)
- Non-owned auto liability for accidents from your employee using their car for your water and sewer (optional)
- Glass or windshield replacement
Inland marine:
Inland marine is a “floater” policy, meaning the coverage travels with the insured items. Rather than covering the property in a specified location like property insurance does, inland marine covers the specified property in any location on the land.
Any items insured under an inland marine policy are covered in any location they may be in (subject to deductible and coverage limits) including:
- Fixed locations
- In transit
- In storage
- At a temporary location
This type of policy covers all the causes of damage normal property insurance does, but may even have some broader covered causes of loss.
Umbrella:
Commercial umbrella insurance provides water and sewer districts additional liability coverage on top of what is already included within general liability, professional liability, public official liability, commercial auto, and workers’ compensation insurance.
If your water and sewer district is hit with a large claim that exhausts your underlying coverage, your umbrella policy will help to cover the rest, up to your chosen limits. In addition, a commercial umbrella policy will cover the legal fees while defending or settling your lawsuit. And in some cases, it may even provide coverage you did not have with your underlying policies.
Public officials:
Public official liability insurance offers coverage for damages or defense costs associated with claims against either elected or appointed officials, employees, or volunteers of the insured water and sewer district.
Most scenarios involving the use of this coverage have to do with accusations against public officials, employees, or volunteers for alleged wrongful acts, errors and omissions.
EPLI:
Employment Practices Liability insurance, or EPLI, is a type of insurance policy protecting water and sewer districts from claims they violated the rights of their employees. This policy can be added onto a water and sewer district’s general liability insurance (with certain limitations), or purchased as a separate policy.
There are two different types of EPLI: 1st party and 3rd party. The distinction between the two is simply who is making the claim. 1st party EPLI covers water and sewer districts from claims if an employee claims his or her rights were violated. 3rd party EPLI covers claims by a third party (like a customer, vendor, or partner) who claims you harassed or discriminated against them.
EPLI covers the following:
- Wrongful dismissal, discharge or termination; wrongful failure or refusal to employ or promote
- Sexual or other workplace harassment
- The loss of certain private employment information
- Employment discrimination including age, gender, race, color and national origin resulting from disparate treatment
- Retaliation
- Violation of the Equal Pay Act or Family Medical Leave Act
Pollution:
Pollution liability insurance is a separate liability policy that covers water and sewer districts for claims of bodily injury, property damage, business interruption, crisis management, transportation liability, as well as clean-up costs associated with toxic materials.
So, if any hazardous waste materials you work with, store, or produce caused injuries or damages to a third party (land/wildlife), this insurance policy would help to pay for the damages, medical bills, and associated legal fees caused by the pollution.
Pollution liability insurance would cover any of the following scenarios as well as numerous others:
- Heat, smoke or fumes from a hostile fire
- Escape of any fuels or lubricants from mobile equipment
- Escape of back-up of sewage or wastewater if property damage occurs away from land you own or lease
- Storage and/or application of pesticides or herbicides
- Potable water which you supply others
- Chemicals you use in your water or wastewater treatment
- Chemicals you use or store in your classrooms and laboratories
- Chemicals you apply, use or store for your ownership, maintenance or operation of swimming pools
- Application, use or storage of road salt or similar substances designed and used for snow and ice removal from roads and similar surface
- Natural gas or propane gas used in your treatment process
Cyber liability and privacy crisis management expense:
Cyber liability insurance will protect water and sewer districts from losses due to cyber attacks, providing coverage for legal services and defense costs, notification expenses, forensic analysis, regulatory compliance and fines, and recovery of lost files.
Either a standalone coverage or as part of a water and sewer district’s liability coverage, cyber coverage is separated into first and third-party coverage. First party is automatically included and covers the costs associated with an attack on a water and sewer district’s computer systems or network. Third-party instead covers claims made by any clients or vendors who have been impacted or injured as a result of an attack on your computer system or network.
What can water and sewer districts expect during the quoting process?
Even if you’re already familiar with the quoting process for water and sewer district insurance, it can still be wise to review what goes into the process and what factors insurance underwriters will be primarily reviewing when writing a quote.
After the initial request for insurance coverage, most agencies will provide numerous forms and paperwork for the water and sewer district to fill out regarding their budget, assets, population served, and many other important factors. When working with Berry Insurance, we would handle this paperwork for you, as well as setting up an in-person meeting to check out the space and get a better gauge of the insured’s expectations from their insurance policy.
When collecting information for a carrier’s underwriters, we would likely need to record the following information for a water or sewer district.
- Budgets
- Claim history/loss runs
- Statement of value - list of all buildings and locations
- Construction Occupancy Protection Exposure (COPE) - determined risk of the property through square footage, year built, type of construction, safety features (sprinklers, alarms, etc.) and when any updates of major systems took place
- Updated schedules for any vehicles or equipment
- Contents limit
- List of drivers - License numbers, dates of birth, claim history
- Accurate information for all vehicles used by the insured
- Dam inspection reports (when applicable)
After gathering all the required information, we would send it to the insurance carrier’s underwriters to review. Once the underwriters have everything in hand, hearing back from them can take anywhere from 2-3 weeks, usually depending on whether they require more information than what we already provided.
Once we get the quote back from the insurance carrier, we would review it before presenting it to the insured, where they can then decide to accept the policy or take some time to compare to other quotes they may have.
The complete process can take around a month or a month and a half, depending on the time of year and if the underwriters are experiencing any delays at the time the quote request is submitted. Delays tend to be more common the closer we get to the water and sewer district’s insurance policy expiration time period around June/July, making it better for any renewals or new insurance inquiries to be sent out earlier in the year.
How much will insuring a water and sewer district cost?
Unfortunately, there is no definitive answer here, as multiple factors unique to each water and sewer district will play a role in determining the overall cost of a given policy.
Price depends largely on the population size being served, the insured’s current budget, the infrastructure, whether or not the district has employees or subcontractors, as well as numerous other contributing factors.
Some smaller water and sewer districts can have policies that cost a couple of thousand dollars, while larger districts can have policies starting at $100,000 and more.
Of course there are always exceptions, and we would have to work directly with any water and sewer district to discuss their unique exposures and history to better determine their personalized price range of their policy.
Insurance you can trust
Now that you have learned more about what coverages you need, the quoting process, and what to expect for cost, you will be prepared for a more seamless insurance renewal season.
At Berry Insurance, we believe that educated clients make for stronger and safer communities. As you can tell, a lot goes into guaranteeing water and sewer districts receive the necessary coverages to ensure their safety, making it crucial for you to have an insurance agency you can trust. If you’re thinking Berry Insurance might be the right agent for you, then reach out to us today so we can begin the process for your water or sewer district.
Interested in learning more about what Berry insurance can offer when working with public entities? Then check out this article: 5 Benefits of Having Public Entity/Municipality Insurance with Berry Insurance.
