Since sundown today, I have had three emails “Is this Longshore….?” In each case, the answer was probably no. This was an above average evening for such emails, but there are not too many days where there is not at least one. Whilst individual subjects vary, the result is the same. When we offer our opinion that something is probably NOT Longshore why should anyone purchase the coverage (or why should any agent recommend the coverage)?
#1 Defense Costs
Unlike a GL policy, in the WC world, no coverage = no defense. Regardless of whether we think the employee falls under Longshore, they can bring that claim. It is easy to spend six figures on legal fees even when we win!
To add Longshore on an IF ANY basis to most WC policies costs less than $250 and that provides unlimited defense costs coverage! What a bargain!
#2 Rogue Verdict
Longshore is constantly expanding, and what we consider not Longshore today, might become so in 3 years when today’s injury goes to trial. Or worse, a judge that just wants to find someone to pay!
#3 Uninsured Longshore Subcontractor
Many risks who might be excluded themselves, such as Marinas or Municipalities, hire Contractors or Subcontractors who work for them who have Longshore exposure but do not buy the right coverage. Under the Longshore act, that passes directly back to the principal, even though the principal might be excluded themselves! They need Longshore coverage! Even more obscure is the subcontractor who used a PEO/Leasing company for their employees but neglects to “name” a subset of their employees.
#4 E&O prevention
No further words needed.
Even when a risk is probably not Longshore, if the exposure is borderline, it's just not worth the risk of not covering Longshore (or Admiralty).