While applicators and project owners often find insurance coverage for Exterior Insulation and Finish Systems (EIFS) can be difficult to obtain, it can be an important safeguard against water damage, construction defects and mold.
Retailers can help general contractors, artisan contractors, architects and engineers, owner builders, wrap programs and others who encounter EIFS. Whether it's general liability coverage, environmental/pollution risks, professional and/or excess liability, here are five key underwriting considerations:
1) Is the contractor properly trained in EIFS installation? Properly trained contractors can distinguish themselves by securing the EIFSmart Contractor distinction. Not only does this distinction provide contractors a competitive edge, it may offer the opportunity to receive reduced insurance rates, because it provides a greater assurance of correct installation. The trained contractor has knowledge and skill to handle the job correctly, resulting in the likelihood of fewer construction and insurance issues.
2) Does the EIFS product the contractor uses have full code approval from the model code agency in its territory? According to the Association of the Wall and Ceiling Industry, a stamp of approval provides a marketing edge and is promoted by contractors when bidding a job. It may offer the opportunity for reduced general liability rates. States and municipalities also have their own building codes. To learn which ones have adopted some or all International Building Codes, visit www.iccsafe.org/gr/Pages/adoptions.aspx.
3) Does the contractor primarily install drainable systems? In a barrier EIFS system, water can get behind the foam insulating board by passing through penetrations in the EIFS. This is a major issue with EIFS. It can happen through doors, windows, leakage through window frames, foot/wall intersections, chimneys and deck attachments. And if it does occur, water can become trapped, soaking into the sheathing and other building components. Today's drainable EIFS systems often make underwriters more willing to accept these risks. These new systems provide a way for intruding water to escape that's among the most robust and advanced moisture-control assemblies available.
4) Are there questions regarding the contractor's quality control? Some EIFS systems fail because contractors mix and match the components from different systems. Checklists – including a defined scope of work – will help avoid errors and oversights in the process. Contractors can build certain protection into the contract documents. All contracts should be in writing.
5) Location of work? Regions that are more humid will generally have greater exposure due to moisture buildups and subsequent mold growth. This has shaken the public's confidence in the products. Allegations of problems with either the actual product or poor installation/maintenance from the manufacturer have spurred lawsuits, both class-action and individuals.
Understanding the EIFS contractor's work and evaluating the risk exposures will assist in the correct placement of coverage. Contact your local broker for assistance in the placement of your next EIFS contractor for general liability, contractors' pollution, professional, and/or excess coverage.
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