Open Forum

Hi,
We run a number of restoration and boatbuilding workshops in the summer, as well as occasional living exhibits by skilled craftsmen.  The question recently came up whether or not our contract instructors must have their own liability and workmen's compensation coverage. My feeling is that instructors should be treated differently than contractors repairing our facilities, for example, and that they shouldn't be held to the same insurance standards.  Often these folks are sole proprietors and carrying these insurances are prohibitive.  How do other museums handle insurance requirements for instructors?  Any input would be helpful in thinking through this issue.
Debra Rantanen
Educator
Antique Boat Museum
Clayton, NY

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Debra Rantanen
Educator
Antique Boat Museum
Clayton NY
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Hi Debra,
I am glad to read that you are taking a reasoned approach to considering this question.
I do not know about the workmen's compensation issue. I would have thought if it is clearly a contract instead of any kind of term employment then it would not be an issue but I am sure someone else could give a more informed answer.
Requiring liability insurance is a way of transferring (the recovery cost of) risk away from your museum onto the contractor. From the museum's perspective alone it makes sense and that is why it is written into the 'boilerplate' clauses of many standard contracts. But, as boilerplate, it is there no matter whether the risk being transferred is significant, as in the case of a contractor doing hot work like welding within a collection holding or historic space, or trivial, as in the case of a workshop presenter giving a lecture or facilitating a discussion. As you have clearly realized, the cost of that ranges from being a sensible, normal part of operation costs for the hot work contractor to wasteful, even prohibitive, for many small companies or individuals providing highly specialized training.
As far as I am aware there are no legal or regulative requirements for demanding such liability insurance. Still, it is reasonable to have it written into the boilerplate of contracts to ensure it is never accidentally left out. Nonetheless, it should be easily deleted by the appropriate museum officer in cases where the risk is negligible. I suggest that the risk can be judged negligible when the risk to the museum due to the contractor's activity is comparable to the risk posed by any visitor. That could include risks of accidental physical damage, theft, fire, etc. which are usually expected to be very small on a per visitor basis.
Again, your willingness to adopt a reasoned approach is much appreciated,
Rob

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Robert Waller PhD
President and Senior Risk Analyst
Protect Heritage Corp.
Ottawa
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Original Message:
Sent: 02-16-2017 03:13 PM
From: Debra Rantanen
Subject: Insurance Coverage for Workshop Instructors

Hi,
We run a number of restoration and boatbuilding workshops in the summer, as well as occasional living exhibits by skilled craftsmen.  The question recently came up whether or not our contract instructors must have their own liability and workmen's compensation coverage. My feeling is that instructors should be treated differently than contractors repairing our facilities, for example, and that they shouldn't be held to the same insurance standards.  Often these folks are sole proprietors and carrying these insurances are prohibitive.  How do other museums handle insurance requirements for instructors?  Any input would be helpful in thinking through this issue.
Debra Rantanen
Educator
Antique Boat Museum
Clayton, NY

------------------------------
Debra Rantanen
Educator
Antique Boat Museum
Clayton NY
------------------------------

Hi Debra,

The instructors should not be treated differently than any other contractors as respects obtaining General Liability and Workers Comp insurance.  The business legal entity status, sole proprietorship, has no effect on whether they should provide your organization proof of insurance.  As an organization, you should protect yourself from any act of negligence the contractors may cause you while on your premises.  Ask all contractors to provide you with a Certificate of Insurance evidencing General Liability and Workers Comp and naming you as an Additional Insured.

Entities should also be cautioned that any contractors paid via 1099’s could be considered as employees at year end Workers Comp Audit.   The insurance company will assume these contractors to have been your employees unless you are able to provide certificates of insurance from them evidencing Workers Comp coverage.   The contractor’s payroll will be added into your audit and you will be charged the additional premium.  It is very important to secure certificates of insurance and provide to auditors to avoid this additional cost at audit.

Lastly, sole proprietors may not be required to carry WC insurance and in those cases, you may request them to sign waivers.  Seek legal counsel for further guidance on acceptable waivers.

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Casey Wigglesworth
Account Executive
Huntington T. Block Insurance Agency An AON Company
Washington DC
------------------------------

Original Message:
Sent: 02-16-2017 03:13 PM
From: Debra Rantanen
Subject: Insurance Coverage for Workshop Instructors

Hi,
We run a number of restoration and boatbuilding workshops in the summer, as well as occasional living exhibits by skilled craftsmen.  The question recently came up whether or not our contract instructors must have their own liability and workmen's compensation coverage. My feeling is that instructors should be treated differently than contractors repairing our facilities, for example, and that they shouldn't be held to the same insurance standards.  Often these folks are sole proprietors and carrying these insurances are prohibitive.  How do other museums handle insurance requirements for instructors?  Any input would be helpful in thinking through this issue.
Debra Rantanen
Educator
Antique Boat Museum
Clayton, NY

------------------------------
Debra Rantanen
Educator
Antique Boat Museum
Clayton NY
------------------------------

Original Message------

Hi Debra,

The instructors should not be treated differently than any other contractors as respects obtaining General Liability and Workers Comp insurance.  The business legal entity status, sole proprietorship, has no effect on whether they should provide your organization proof of insurance.  As an organization, you should protect yourself from any act of negligence the contractors may cause you while on your premises.  Ask all contractors to provide you with a Certificate of Insurance evidencing General Liability and Workers Comp and naming you as an Additional Insured.

Entities should also be cautioned that any contractors paid via 1099’s could be considered as employees at year end Workers Comp Audit.   The insurance company will assume these contractors to have been your employees unless you are able to provide certificates of insurance from them evidencing Workers Comp coverage.   The contractor’s payroll will be added into your audit and you will be charged the additional premium.  It is very important to secure certificates of insurance and provide to auditors to avoid this additional cost at audit.

Lastly, sole proprietors may not be required to carry WC insurance and in those cases, you may request them to sign waivers.  Seek legal counsel for further guidance on acceptable waivers.

------------------------------
Casey Wigglesworth
Account Executive
Huntington T. Block Insurance Agency An AON Company
Washington DC
------------------------------

Thanks to all for your input. I'll bring your comments to our internal discussions. I assumed that general liability insurance would be necessary, but the workers compensation requirement will be a serious stumbling block for our stand alone instructors.

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Debra Rantanen
Educator
Antique Boat Museum
Clayton NY
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Original Message:
Sent: 02-21-2017 08:35 AM
From: Geri Thomas
Subject: Insurance Coverage for Workshop Instructors

Yes, the instructors need to present you with liability coverage and assurance of workers comp.  In our agency, we've been around the block with this for art handlers we use on projects as well as anyone I contract with to assist with consulting or training sessions.  All best, Geri Thomas, artstaffing.