Airport Insurance Requirements (2023) / Chapter Skim
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From page 47... ...
47 Third-Party/Vendor Insurance Requirements There are 4,000 airports in the United States that are mostly owned by governmental entities. The types of and variations in contracts and agreements that airports enter into are numerous.
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48 Airport Insurance Requirements Contract Categorya Examples of Activities Covered by Contract Type Professional services Architects and engineers of all specialties Airport's construction management representative Legal services of all specialties Tax and auditing services Project management contractor Repair and maintenance Automated people movers Lift system maintenance and repair Jetway bridge maintenance and repair Any contractor hired to maintain airport building Maintenance and repair contractors Tenant and user Right of entry agreements Easements Basic space and use agreements Fueling leases Developer agreements Standard commercial operator leases Airline signatory • Agreements between airlines and the airport • Includes airfield and terminal usage agreements Ground transportation Contracts that provide rights of access to airport Taxis, Lyft, Uber, and other rideshare entities Vendor and purchase Acquisition of goods and services for airport Software and IT Financial systems Passenger flight displays Telecommunications Security and data lines • • • • • • • • • • • • • • • • • • • • • • • • Software and IT system designers, installers, or aThe categories of contracts referenced and used in this guide are those presented in ACRP Legal Research Digest 30: Contract Risk Management for Airport Agreements (Alfert and Starcher 2016)
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From page 49... ...
Third-Party/Vendor Insurance Requirements 49 4.1.2 Step 2: Conduct a Risk Assessment Based on the Contracted Scope of Work The second step in developing insurance requirements is a risk assessment. This section will outline the various types of property and casualty risks that could exist in contracts let by airports.
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50 Airport Insurance Requirements parties, including employees of the airport and the property of the airport. Requiring vendors to provide evidence of general liability (see Box 4-2)
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Third-Party/Vendor Insurance Requirements 51 environmental, structural, civil, mechanical, and electrical; surveyors; legal and tax professionals; real estate advisory services; risk management consultants; and insurance brokers and agents. Typical professional services contracts that do not require professional liability are training and education consultants, project management consultants, software training consultants, and recruiters.
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52 Airport Insurance Requirements utility lines carry the risk of line ruptures that can cause pollution incidents on airport property. Requiring pollution liability for these types of risks will ensure a funding mechanism is available to defend, indemnify, and clean up and remove toxic substances.
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Third-Party/Vendor Insurance Requirements 53 funding mechanism is in place to cover liabilities arising from selling, serving, or distributing alcoholic beverages. 4.1.2.8 Aircraft and Passenger Liability All airline signatory agreements and some tenant and use agreements face significant risks involving the ownership, maintenance, and use of commercial aircraft that is operated on and around airport property.
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54 Airport Insurance Requirements 4.1.2.10 Installation Floater An airport faces risk of loss to equipment or materials that are either in transit or stored on airport property but not yet installed as permanent improvements or betterments. Perils such as fire, wind, hail, theft, flood, or other causes of loss could damage or destroy the equipment or materials prior to their permanent installation on airport property.
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Third-Party/Vendor Insurance Requirements 55 and maintained by the airport. Such loss usually occurs when vendors such as janitorial, carpet cleaning, or security guard services have access to the airport's premises during nonbusiness hours.
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56 Airport Insurance Requirements Airports can also require vendors to purchase business interruption insurance, which would provide continued rental income to the airport in the event of a covered cause of loss under the property insurance policy. Table 4-2 lists relative risks for basic and ancillary coverage by contract category.
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Third-Party/Vendor Insurance Requirements 57 Contract Category Workers' Compensation and Employer's Liability General Liability Auto Liability Professional services WC: Statutory EL: $1,000,000 $1,000,000 per occurrence $2,000,000 general aggregate $1,000,000 combined single limit Repair and maintenance WC: Statutory EL: $1,000,000 $1,000,000 per occurrence $2,000,000 general aggregate $1,000,000–$5,000,000 combined single limit Tenant and user WC: Statutory EL: $1,000,000 $1,000,000 per occurrence $2,000,000 general aggregate $1,000,000–$5,000,000 combined single limit Airline signatory WC: Statutory EL: $1,000,000 $1,000,000–$25,000,000 per occurrence $2,000,000–$25,000,000 general aggregate $1,000,000–$25,000,000 products/completed operations $1,000,000–$10,000,000 combined single limit Ground transportation WC: Statutory EL: $1,000,000 $1,000,000–$25,000,000 per occurrence $2,000,000–$25,000,000 general aggregate $5,000,000–$25,000,000 combined single limit Vendor and purchasing WC: Statutory EL: $1,000,000 $1,000,000–$10,000,000 per occurrence $2,000,000–$20,000,000 general aggregate $1,000,000–$10,000,000 products/completed operations $1,000,000–$5,000,000 combined single limit Software and IT WC: Statutory EL: $1,000,000 $1,000,000 per occurrence $2,000,000 general aggregate $1,000,000 combined single limit Note: WC = workers' compensation; EL = employer's liability. Table 4-3.
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From page 58... ...
58 Airport Insurance Requirements 4.1.5 Step 5: Assemble the Insurance Requirements into a Master Document The last step in developing insurance requirements is to assemble the insurance requirements into a master document. Insurance requirements in airport contracts should contain the coverage shown in Box 4-13.
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