(October 2008)
CG 00 35–Railroad Protective (RRP) Liability Coverage Form provides protective liability coverage for owners of railroads and property owners from the vicarious acts of contractors or subcontractors working under contract for them or on their behalf. It provides coverage for claims for bodily injury or property damage and for physical damage to certain property of the insured arising out of operations performed by the designated contractor. The contractor or subcontractor doing the work purchases the coverage in the name of and for the benefit of the railroad company needing protection. For example, a contractor demolishing a building adjacent to a railroad track may have to purchase railroad protective coverage for the property owner, the railroad or both!
The Railroad Protective Liability Coverage Form consists of two distinct coverage parts. The first part protects the railroad from certain vicarious liability claims for bodily injury and property damage. The second part protects the railroad from physical damage to its property. The coverage is very limited and specific to a particular set of circumstances.
While the named insured is the railroad company, it is not the party that purchases the coverage. The designated contractor doing the work on or near the railroad property purchases it. The insurance protection provided only applies to the specific job location described on the declarations. Coverage ends when either the job is finished or the policy expires, whichever occurs first. Coverage does not apply to products or completed operations exposures.
This coverage is needed even though the contractor could add the property owner or the railroad as an additional insured on its CGL. In most cases, handling the coverage in that manner is inadequate because railroad companies always make requiring separate coverage a part of the written contract. Even if the property owner or railroad company is named as an additional insured on the CGL, the limits available may be reduced because of payment of other losses to which coverage applies. A major consideration is that the CGL excludes all contractual liability except for specific agreements listed as insured contracts. The contract for work between a contractor or subcontractor and a railroad company or property owner for construction or demolition operations on or near a railroad track is not an insured contract.
The Railroad Protective Liability Coverage Form has no stated eligibility requirements or specific references concerning whether or not it applies to a given operation or business. Contractual requirements determine when the coverage provided by this form is needed and its use is limited to specific circumstances. The named insured must be a railroad company since the form's definitions and coverages are limited to railroad property. The contractor performing the work on or near railroad property arranges for and purchases the coverage for the benefit of and on behalf of the railroad company.
The ISO Railroad Protective (RRP) Liability Coverage consists of the following basic parts or forms:
Note: IL 00 17–Common Policy Conditions is not attached to this coverage form because the conditions contained in it are included in the Railroad Protective Liability Coverage Form.
The ISO Railroad Protective (RRP) Liability Coverage Form includes the following sections:
Please refer to PF&M Section 272.4-2, Railroad Protective (RRP) Liability Coverage Form Analysis, for a detailed analysis of the coverage form. Please refer to PF&M Section 272.3, Railroad Protective (RRP) Liability Coverage Form Comparison With The Commercial General Liability Coverage Form, for a comparison of the RRP coverage form with the CGL coverage form.
The scope of coverage provided by the Railroad Protective Liability Coverage Form is relatively narrow. For this reason, only a limited number of endorsements are available for use with it. Please refer to PF&M Section 272.4-3, Railroad Protective (RRP) Liability Coverage Form Available Endorsements And Their Uses, for a listing and brief explanation of endorsements available for use with this coverage form.
Underwriting Railroad Protective (RRP) Liability Coverage involves identifying potential exposures, analyzing them relative to the degree of risk represented by each, classifying the risk and then rating and pricing the exposures correctly. Please refer to PF&M Section 272.5-1, Railroad Protective (RRP) Liability Coverage Form Underwriting Considerations, for more information and guidance concerning the underwriting process.
Rating Railroad Protective (RRP) Liability Coverage is detailed in Rule 49 in the General Liability section of the ISO Commercial Lines Manual (CLM). The classifications eligible for use and application are listed along with footnotes, instructions and explanations. Please refer to PF&M Section 272.5-2, Railroad Protective (RRP) Liability Coverage Form Rating Considerations, for more information and guidance concerning the rating process.