RAILROAD PROTECTIVE LIABILITY COVERAGE FORM RATING CONSIDERATIONS

(November 2019)

CLASSIFICATIONS

The Insurance Services Office (ISO) developed the classification and rating system to use with CG 00 35–Railroad Protective Liability Coverage Form. Its goal was to group similar operations into classifications that reflect hazards that are common to operations performed in each classification. The classification and rating details are in Rule 49 in the ISO Commercial Lines Manual (CLM). The four classifications applicable to form CG 00 35 are the following:

• Class Code 40011: Operations–Railroad NOC–Construction Operations–Operations Performed for Railroads
• Class Code 40012: Operations–Railroad NOC–Construction Operations–Operations Performed for Operations Other Than Railroads
• Class Code 40013: State or Federal Highway Projects
• Class Code 40014: Operations involving no work within 50 feet of tracks on which railroad trains run or which involve no exposure to actual railroad train hazards (railroads)

PREMIUM BASE

The premium base for CG 00 35 is the total cost of all work let or sublet in conjunction with each designated project. This includes the cost of all labor, materials, and equipment used, furnished, or delivered for use to complete the project. It does not include the cost of finished equipment installed but not furnished by subcontractors when such installations are the extent of their work. It also includes the cost of work trains or other railroad equipment the insured railroad provides to the contractor for work related to the project.

The loss costs apply per $1,000 of total cost.

RATING FORMULA

There are no published loss costs for these classifications. In some cases, Estimated Loss Potentials (ELP's) are provided but these are subject to individual insurance company filings. The insurance company must modify the loss cost for the appropriate classification by its loss cost multiplier factor to arrive at the adjusted rate. This rate is then multiplied by the increased limits factor that applies for the limit of insurance selected to arrive at the final rate. The last step is to multiply the job’s total cost by the final rate per $1,000 of total cost to arrive at the total premium charge.

LIMITS OF INSURANCE

Most railroads usually require minimum limits of at least $2,000,000 per occurrence and $6,000,000 aggregate. Other limits can be provided.

EXPERIENCE OR SCHEDULE RATING PLAN

The ISO Commercial General Liability Experience Rating Plan and Schedule Rating Plan do not apply to rating for CG 00 35. There are no other individual rating programs available to use with it. The insurance company that provides coverage must develop and specifically file optional, supplemental, or special rating plans, programs, or deviations for a specific job or project.