Template 11

Use Template 11 for:

License Agreements of limited time or limited use.

• Licensee does not maintain premises, and may not make improvements or alterations.

Examples: Use of, or access to, facilities or property: (1) on an intermittent basis; (2) for a limited number of times; or (3) for a special event.

Insurance requirements should be saved and attached to the contract as an exhibit. To ensure the requirements are included as part of your contract, please include the following language within the insurance section of the agreement:

_______ is required to maintain the insurance specified in Exhibit _____, which is attached hereto and incorporated herein by this reference.

Edit the template to keep the language consistent with your agreement.

For example: if the template refers to: “Consultant”, but the agreement uses “Contractor”, change all references in the template to “Contractor”. If your agency is not the County (SCAPOSD, Water Agency, Fairgrounds, etc.) substitute the correct terminology for all references to “County”. If the agreement is called “contract”, “license”, “lease”, etc., edit the template to match.

Download Template 11
(Word: 23 kB)

Licensee shall maintain and require its subcontractors and agents to maintain insurance as described below unless such insurance has been expressly waived by the attachment of a Waiver of Insurance Requirements.

County reserves the right to review any and all of the required insurance policies and/or endorsements, but has no obligation to do so. Failure to demand evidence of full compliance with the insurance requirements set forth in this Agreement or failure to identify any insurance deficiency shall not relieve Licensee from, nor be construed or deemed a waiver of, its obligation to maintain the required insurance at all times during the performance of this Agreement.

1. Workers Compensation and Employers Liability Insurance
   1. Required if Licensee has employees.
   2. Workers Compensation insurance with statutory limits as required by the Labor Code of the State of California.

      Under California’s Labor code, if the party with whom we are contracting is a privately held corporation whose only employees are its sole shareholders, workers compensation insurance is not required. Similarly, if the party with whom we are contracting is a partnership or limited liability company with no employees other than its general partners or managers, workers compensation insurance is not required. A waiver is not needed.

   3. Employers Liability with minimum limits of $1,000,000 per Accident; $1,000,000 Disease per employee; $1,000,000 Disease per policy.
   4. Required Evidence of Insurance: Certificate of Insurance
   
   

   If Licensee currently has no employees, Licensee agrees to obtain the above-specified Workers Compensation and Employers Liability insurance should any employees be engaged during the term of this Agreement or any extensions of the term.

   If the licensee has no employees, Workers Compensation insurance is not required. The licensee is obligated to obtain the insurance if employees are hired after the inception of the agreement. A Risk Management waiver is not needed if the licensee has no employees.

   To verify that the consultant has no employees, Risk Management recommends that you have the consultant sign the Workers Compensation Declaration (Word: 25 kB).

2. General Liability Insurance
   1. Commercial General Liability Insurance on a standard occurrence form, no less broad than Insurance Services Office (ISO) form CG 00 01.

      ISO (Insurance Services Office) publishes a standard CGL. Some insurers use that specific form; others use their own form with a different numbering system. Any CGL is acceptable as long as the coverage is as broad as the ISO form.

      An occurrence policy responds if the injury or damage takes place during the policy period. It doesn’t matter when the claim is filed.

      A claims-made policy responds if the claim (demand for money) is made during the policy period.

   2. Minimum Limits: $1,000,000 per Occurrence; $2,000,000 General Aggregate; $2,000,000 Products/Completed Operations Aggregate. The required limits may be provided by a combination of General Liability Insurance and Commercial Excess or Commercial Umbrella Liability Insurance. If Licensee maintains higher limits than the specified minimum limits, County requires and shall be entitled to coverage for the higher limits maintained by Licensee.

      Occurrence limit: the most the insurer will pay for any one accident.

      General Aggregates: the most the company will pay for all claims resulting from damage or injuries that occur before the work is completed, regardless of the number of accidents, injuries, claims or claimants.

      Products/Completed Operations Aggregate: the most the insurer will pay for all claims resulting from damage or injuries that occur after the work is completed, regardless of the number of accidents, injuries, claims or claimants.

      A Commercial Umbrella or Excess Liability policy provides additional limits which are usually shown on the Certificate of Insurance. The additional limits are added to the General Liability Limits. The combined total of the Excess or General Liability Limits and the Umbrella Limits must equal or exceed our minimum requirements. A policy with no general aggregate is acceptable because there’s no annual cap on the amount the policy will pay.

      Department Waiver: You may waive the requirement for Products/Completed operations coverage if food or other tangible items (souvenirs, toys, tee-shirts, arts & crafts, household items, etc.) will not be sold or distributed.

   3. Any deductible or self-insured retention shall be shown on the Certificate of Insurance. If the deductible or self-insured retention exceeds $25,000 it must be approved in advance by County. Licensee is responsible for any deductible or self-insured retention and shall fund it upon County’s written request, regardless of whether Licensee has a claim against the insurance or is named as a party in any action involving the County.

      Contact Risk Management (Outlook: 139 kB) if the retention or deductible exceeds $25,000.

      We want to verify that the party with whom we are contracting has sufficient assets to fund a large retention or deductible. A waiver is not needed.

      There is no specific field on the Certificate of Insurance for a General Liability deductible or retention.

   4. [insert exact name of additional insured] shall be endorsed as additional insureds for liability arising out of the Licensee’s ongoing operations. (ISO endorsement CG 20 26 or equivalent).

      We must get a copy of the endorsement or section of the policy that makes us an additional insured. A statement on the Certificate of Insurance is not sufficient because an insurance company is bound by its policy and endorsements, not by the Certificate.

      Additional insured endorsements which do not include our name are acceptable if they have language granting additional insured status to parties for whom our vendor (or consultant, contractor, permittee, licensee, tenant, etc.) is required to provide additional insured status under a contract or agreement. Submit a HelpRequest (Outlook: 139 kB) if you’re not sure the endorsement is acceptable.

      ISO endorsement CG 20 26 covers the County for liability arising out of the licensee’s ongoing operations or liability arising from premises rented to the licensee.

      Not acceptable – Endorsement CG 20 10: "additional insured...but only with respect to liability...in the performance of your ongoing operations for the additional insured(s)." With this language then we are not an additional insured because the licensee is not doing any work for us.

   5. The insurance provided to the as additional insureds shall be primary to, and non-contributory with, any insurance or self-insurance program maintained by them.

      Because the County is an additional insured on the licensee’s policy, we want that policy to cover claims before any contribution from County’s CSAC protection or its self-insured retention.

      Some insurers refuse to add " primary & non-contributory" language. In this situation, you may accept the insurance anyway. Why? Because California Government Code Section 990.8 states that a public agency’s self-insurance and/or participation in a risk sharing pool (CSAC) does not qualify as insurance. Legally, County has no insurance. The coverage provided to County as an additional insured on the licensee’s policy is the only insurance we have. By default it is primary and non-contributory. It is preferable to have the insurer provide the required language, but not mandatory.

      Marinas & Airport: Because County has commercial insurance for the Marinas & Airport, we do require evidence of primary and non-contributory coverage for all contracts relating to those facilities.

      We must get a copy of the endorsement or section of the policy that has the Primary & Non-Contributory language. A statement on the Certificate of Insurance is not sufficient because an insurance company is bound by its policy and endorsements, not by the Certificate.

      Use the alternate Evidence of Insurance language.

   6. The policy shall cover inter-insured suits between County and Licensee and include a "separation of insureds" or "severability" clause which treats each insured separately.

      This guarantees that the County will be covered if it is sued by the licensee and that the licensee will be covered if it is sued by the County. This language is standard in the General Liability policy; you do not need to get a specific endorsement to satisfy this requirement.

   7. Required Evidence of Insurance:
      1. Copy of the additional insured endorsement or policy language granting additional insured status; and
      2. Certificate of Insurance
      
      

      (Substitute the following for g. if the work, event or location involves marinas or the airport. Do not leave both versions of g. in the agreement!)

   g. Required Evidence of Insurance:

   1. Copy of the additional insured endorsement or policy language granting additional insured status;
   2. Copy of the endorsement or policy language indicating that insurance is primary and non-contributory; and
   3. Certificate of Insurance

    

3. Automobile Liability Insurance
   (Required if (1) autos are used in the event or activity; or (2) the activity involves substantial loading and unloading of property.)
   1. Minimum Limit: $1,000,000 combined single limit per accident.

      A Commercial Umbrella or Excess Liability policy provides additional limits which are usually shown on the Certificate of Insurance. The additional limits are added to the Auto Liability Limits. The combined total of the Auto Liability Limits and the Excess or Umbrella Limits must equal or exceed our minimum requirements.

   2. Insurance shall cover all owned autos. (Required only if Licensee owns vehicles.)
   3. Insurance shall apply to all hired and non-owned vehicles.  

      Hired Autos: vehicles the Licensee rents or borrows.

      Non-owned Autos: vehicles owned or operated by the Licensee’s members, employees, subcontractors, agents, vendors, suppliers or exhibitors.

      If "Any Auto" is checked on the Certificate of Insurance, it includes owned, hired and non-owned autos.

      This coverage is not required if vehicles are used only for driving to and from our premises. It is required if vehicle use is part of the activity or if there is substantial loading or unloading of equipment. Example: loading /unloading of booths and display items for a fair or festival.

   4. Required Evidence of Insurance:
   1. Certificate of Insurance
4. Liquor Liability Insurance (For events with alcohol)

   This insures those who sell or serve alcohol professionally for injuries caused by an intoxicated person to whom they have provided alcohol. Liquor liability insurance may be in the name of either the licensee or the licensee’s caterer.

   Liquor liability is required only if (1) alcohol is provided for a charge or (2) alcohol is provided without charge, but served by a professional caterer.

   Delete this requirement if (1) or (2) above don’t apply. Also, delete this requirement for events held at the Fairgrounds that use the Fair’s liquor caterer. Do not delete this requirement for Fairgrounds events that use their own liquor caterer.

1. Minimum Limits: $1,000,000 for each Common Cause or Occurrence; $1,000,000 Aggregate.

   A common cause is all injury or damage resulting from providing alcohol to any one person.

   Some insurers do not provide separate liquor liability limits; instead, they delete the liquor liability exclusion from the General Liability policy. In that situation the General Liability limits include liquor liability claims. This is acceptable.

2. Any deductible or self-insured retention shall be shown on the Certificate of Insurance. If the deductible or self-insured retention exceeds $25,000 it must be approved in advance by County. Licensee is responsible for any deductible or self-insured retention.

   Contact Risk Management (Outlook: 139 kB) if the retention or deductible exceeds $25,000. We want to verify that the party with whom we are contracting has sufficient assets to fund a large retention or deductible. A waiver is not needed.

   There is no specific field on the Certificate of Insurance for a General Liability deductible or retention.

3. Required Evidence of Insurance: Certificate of Insurance
5. Standards for Insurance Companies

   Insurers shall have an A.M. Best’s rating of at least A:VII.

   A.M. Best is one of the services that reviews insurers’ financial information. We want the insurer to be able to pay its claims. The letter (A+, A, A-, B+, etc.) is Best’s rating of financial strength. The number (XII, VII, etc.) refers to the insurer’s financial size. You can check the rating at: http://www.ambest.com/ - the service is free, but you need to register and log in.

   Department Waiver: You may waive the A.M. Best’s rating if an insurer’s rating is below A:VII.

6. Documentation
   1. The Certificate of Insurance must include the following reference: [insert event name and date or other reference].

      Putting the reference on the Certificate of Insurance does not increase County’s protection. This requirement is included for your convenience.

   2. All required Evidence of Insurance shall be submitted prior to the execution of this Agreement. Licensee agrees to maintain current Evidence of Insurance on file with County for the required period of insurance.
   3. The name and address for Additional Insured endorsements and Certificates of Insurance is: [insert exact name and address].
   4. Required Evidence of Insurance shall be submitted for any renewal or replacement of a policy that already exists, at least ten (10) days before expiration or other termination of the existing policy.
   5. Licensee shall provide immediate written notice if: (1) any of the required insurance policies is terminated; (2) the limits of any of the required policies are reduced; or (3) the deductible or self-insured retention is increased.
   6. Upon written request, certified copies of required insurance policies must be provided within thirty (30) days.

      Because it takes much time and substantial expertise to review an entire insurance policy, we don’t routinely request it. However, if we cannot determine the adequacy of coverage from the certificate and endorsements, this is an option.

7. Policy Obligations

   Licensee’s indemnity and other obligations shall not be limited by the foregoing insurance requirements.

8. Material Breach

   If Licensee fails to maintain insurance which is required pursuant to this Agreement, it shall be deemed a material breach of this Agreement. County, at its sole option, may terminate this Agreement and obtain damages from Licensee resulting from said breach.