In 1977, a railroad accident involving a bulldozer and a train occurred that resulted in the damage of property exceeding $50,000 and staff injury under the Federal Employers Liability Act (FELA) summing up to $30,000. This tragedy was caused by a couple of young men who drove a bulldozer and left it onto the tracks 60 feet south of the temporary crossing, where some contractors were building an interstate highway.
Later on, an insurance company issued the contractors a railroad protective liability insurance. However, the USA district court ruled against the issuance of the policy, on the grounds that this coverage was limited to ‘acts or omissions’ at the specific job location, which was the temporary crossing and NOT 60 feet away. So, you can imagine, the financial burden and crisis the losing party had to endure!
Moral lesson of the story? You ought to thoroughly understand all the terms and conditions of a policy, before signing any legal contract or making an annual or monthly payment of a policy. With that said, if you are a contractor or you own an organization or firm which conducts its activities within or on a railroad and you are looking for answers on railroad protective liability insurance; then read on.
This railroad protective liability policy is abbreviated as RRP. It is a coverage that every contractor, organization, or firm must have to carry out its work or activities on or about 50 feet or 15.24 meters within a railroad property.
Railroad protective liability endorsement does NOT cover the contractor, rather it covers the railroad entity from any physical damage that may be caused by the policyholder. Hence, the insured is the railroad owner and not the contractor. It’s also not designed to replace or act in the place of the commercial general liability insurance policy.
Please note that before filling out a railroad protective liability coverage form, you must provide your preferred insurance company or agent with the following intricate details:
The precise location of your job
The work or activities you intend to carry out
These details are used to underwrite and complete a policy declaration that meets all the requirements of the Railroad Insurance Management Association. It’s also important to note that this policy must be an International Organization for Standardization (ISO) form.
A Railroad typically requests that some kind of hold harmless agreement that indemnifies (compensates for a loss) the railroad, in case the insurance RRP doesn’t apply. This is so because railroads are expensive thus, they require broad indemnification agreements. Needless to say, its crucial that before signing the hold harmless agreement, contractors ought to make sure that this agreement doesn’t contain some limiting contractual endorsement when it involves the railroad’s sole negligence.
A railroad contractors liability insurance will only remain valid if any of the below conditions remain unmet or are not fulfilled:
The RRP expiration date has not yet matured or arrived
The intended work or project to be done has not been completed
The terms and conditions of the RRP contract are yet or have not been fulfilled
The OCP and RRP look similar in that both policies are purchased for the benefit of the railroad. Both only apply solely when the operations are in progress and they are site-specific (the coverage ONLY applies to the location where the job is being carried out). Despite the railroad protective policy being almost similar to the owner protective liability insurance (OCP), there is one distinguishing feature that sets these policies apart.
An RRP differs from an OCP in that the latter offers limited coverage to the negligent liability of the policyholders, whereas RRP covers a bit more since it provides its policyholders with bodily injury or property damage coverage. Important to note is that for the RRP to be used a bodily injury or property damage MUST be directly related to, or is in connection with, the activities or work carried out by the contractor or any other subcontractor to whom the RRP is issued.
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Like most legal contracts, the railroad protective liability policy is not exempted from misconceptions. Getting acquainted with these misunderstandings will not only save you from making a fatal financial decision but will also shield you from incurring costs that were supposed to be covered by your insurance provider. Together, let's bust some of the most common RRP misconceptions:
Commercial general liability can be used in place of railroad protective liability insurance. The fact is that both these two policies are separate entities and cannot in any way be used interchangeably
The owner-contractor liability insurance is synonymous to railroad protective liability insurance. Even though, these two have a number of similarities they also have a major difference that distinguishes them apart
You cannot purchase the railroad protective liability coverage form if your working area is on or within 50 feet of a railroad. We point of fact, this is what the RRP stands for
Below is a list of some of the costs covered under the railroad protective liability coverage:
Bodily injuries caused by a derailment
Property damage or loss occurring due to a derailment
Physical damage to the railroad’s actual property
Legal fees in regard to defense expenses that are outside the RRP policy-these fees include, legal paperwork, investigations to be carried out during a lawsuit, and court filing fees
Foreign rolling stock-these are losses incurred by rail cars not owned by the policyholder
Evacuation expenses- these are cleanup costs that are incurred after the spillage of environmental or bio-degrading substances such as petroleum oils and other poisonous chemicals
Federal Employees Liability Act Coverage-this acts like the workers’ comp policy in the railroad industry. The RRP compensates railroad workers for any claims while on the job
Any business that works on or near a railroad should purchase a railroad protective liability coverage. Below is a list of some of the actual business lines or niches that will best benefit from a railroad protective liability application:
Rail Service Companies
Railcar Lessors and Lessees
Tourist and Excursion Railcar owners
Transit and commuter rail systems
Freight Shipment Companies that deal with shipping cars, highly explosive substances and chemicals such as dynamite and gasoline
The average cost of RRP is $250 per month or $3,000 per year. Before the cost of RRP is made, an insurance company considers several factors. What follows is a list of factors that are used in the calculation of railroad protective liability cost:
How much the project to be carried out costs
The number of tracks in proximity to the contractor’s working area
The estimated number of freight and passenger trains that will pass by the contractor’s working area
The projected cost of work that will occur within the vicinity of the railroad’s property
The specific location of the project or the scheduled railroad
In connection, here’s a table showing the further railroad protective liability insurance cost estimates based on the rates of the best companies:
|Company||Cost per Month||Cost per Year||Best for|
|NEXT||$150||$1,800||Best overall; Fastest coverage|
|CoverWallet||$180||$2,160||Comparing RRP insurance quotes online|
|The Hartford||$190||$2,280||Railroads with a history of claims|
|Tivly||$200||$2,400||Comparing RRP insurance quotes over the phone|
|Thimble||$258||$3,096||Small railroads or railroads in need of flexible coverage options|
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Here are some of the best companies for railroad protective liability insurance. Read some of the reviews below to know their pros, cons, and rate for a $1 million RRP coverage.
Fast delivery services. Provides one with an online proof of insurance immediately after applicate
Unmatchable customer service
It has efficient working apps
10% discount on purchase of bundled policies
Couldn’t find any
NEXT is rated an A- and this digitally teched-up insurance provider is well known for its ever-dynamic competitive rates. This company can hook you up with its partners that may provide railroad protective liability coverage.
Best for: Best overall; Fastest coverage
Average cost: $150 per month
Our rating: 10/10
It available in all 50 states of USA
It's financially stable
It provides its clientele with discounts
It has developed fully functioning mobile apps
Online quotes are not always available
Rated A by A.M Best, The Hartford has helped both small and large business reach their maximal potential by providing them with premium yet affordable insurance policies. Apart from dealing with insurance policies, this two-century-old insurance carrier also provides financial services.
Best for: Railroads with a history of claims
Average cost: $190 per month
Our rating: 10/10
Its policyholders can obtain their certificate of insurance online
Compare RRP quotes online
All its policies are centralized that is nested in one place
It provides its clients with a free trial period
The whole insurance application process may not be completed online
CoverWallet is a dedicated insurance advisor is an online-based insurance agency that provides all its potential policyholders with free quotes and extensive insurance comparison options. It’s a good option for both small businesses and enterprise businesses.
Best for: Comparing RRP insurance quotes online
Average cost: $180 per month
Our rating: 9/10
Its quotation process is very easy
It’s a reliable insurance provider as it partnered with over 200 insurance providers
It’s developed and designed to help you match your insurance needs
No online quote
Tivly is a financially stable insurance agency that works to provide the best insurance policies for both small- and large-scale business owners. Despite it being one and a half decades old, Tivly has over the years demonstrated its ability to source suitable policies for its clients from its over 200 partnered insurance providers. Call now and talk with a representative to get quotes.
Best for: Comparing RRP insurance quotes over the phone
Average cost: $200 per month
Our rating: 8/10
It has a mobile app
It provides its clientele with 5% discount
Its website is straightforward making it easy for both newbies and ‘tech-challenged’ individuals
It lacks a local agent network
Hiscox is another insurance giant that has been in existence for the last 120 years. This premium insurance provider offers its customers a wide variety of insurance policies. Your RRP policy from Hiscox will come from its partners.
Best for: Commercial policies
Average cost: $500 per month
Our rating: 8/10
Provides on-demand coverage, allowing businesses to purchase insurance only when needed
Offers flexible policies that can be customized to suit specific business needs
Provides coverage within minutes through their easy-to-use mobile app
Offers affordable and competitive rates
Excellent customer service and support
Limited coverage options for large railroads with extensive operations
Thimble is a digital insurance provider that specializes in providing on-demand liability insurance coverage for small businesses, including railroad operations. They offer flexible policies that can be customized to suit the needs of different businesses, making it convenient for railroads with varying operations. Thimble will refer to Tivly for RRP coverage.
Best for: Small railroads or Railroads in need of flexible coverage options
Average cost: $258 per month
Our rating: 9/10
A railroad protective liability insurance is an ISO insurance coverage purchased by contractors under the mandate of the Railroad Insurance Management Association to protect the railroad property. Thus, the insured name is the railroad owner and not the contractor. Despite the railroad liability policy having a number of similarities with the Owner Contract Liability Policy, the two differ in that the latter provides limited coverage to the negligent liability of the policyholder whereas the former provides coverage to a third party by observing the acts and omissions claim
A railroad protective liability coverage is said to be valid ONLY when its expiry date hasn’t arrived, a project is ongoing and the terms of the contract have not or are yet to be fulfilled. The cost of how much a contractor will pay for their RRP is determined by a number of factors. These factors include the cost of the project, the number of tracks within the contractor’s working area, the estimated number of freight and passenger trains that will pass by a contractor’s working area, and the specific location of the working area
Third-party bodily injuries and property damage caused by derailment, physical damage to the railroad's property, legal defense expenses, and compensation of railroad workers are some of the costs covered by this essential insurance policy
Organizations and companies that are required to purchase this protective insurance policy are railcar lessors and lessees, tourist and excursion railcar owners, rail service companies, truck owners, freight companies that deal with highly explosive products or substances, and railroad contractors
NEXT, The Hartford, Tivly, Hiscox, and Thimble have been rated as some of the best railroad protective liability policy providers in the insurance industry. These reputable companies provide their policyholders with affordable premium RRP
Lonnie Bell Insuranker
Policy Type: Business Insurance
Company name: Employers Insurance
Use anyone except Employers. Period. They are non-transparent and shameful. After I complained long enough to warrant a call from a supervisor, the supervisor called back from a PRIVATE NUMBER (no caller ID), left a message that they are not reversing their decision (without any communication with me), and failed to leave a phone number for me to call back. She was hiding! They also fact find via email and phone calls, which is terrific for speed and communication. However, after setting a precedence of email or phone calls, they send time sensitive information via email, without any heads up... they are hoping you miss it and forfeit via expiration. Evil policies. Go elsewhere.
This place is an absolute joke of a company and should be ashamed of the way they conduct business. I was hurt on the job at the end of July and it took them just shy of 7 weeks to issue out a paycheck to me. Yes the amount was back dated but still. Not many have the luxury of not receiving a paycheck for almost 2 months. To top it all off, the original adjuster marked me down for the wrong state which caused a problem from the get go, I've had 3 different adjusters now since each one can't seem to figure out the simplicity of my claim. All my paperwork which includes, my job, house, and drs visits all are from the same state and city but yet some how I have been filed under a completely different state 1500 miles away. They do not answer your phone calls or emails no matter how many you leave. I've had to escalate my frustrations to the supervisors of each of these individuals in order to even get some kind of response. I've had more communication and information given to me about my claim from the customer service representatives then the actual adjusters.......... please tell me how that works?! A serious overhaul needs to happen here in order to serve your clients the way they deserve to be taken care of. 10/10 do not recommend this company to a single soul on earth
I have never had the displeasure of working with a more incompetent and disrespectful person in my life. I’m an injured worker and the adjuster that was assigned to my case was named Carrie Furgeson. In the past 6 weeks that I’ve been injured and out of work I have only been able to get ahold of her twice, not for lack of trying. I have left countless voicemails, countless emails, and she ignores them all. When I am finally able to get ahold of her I’m greeted with terrible customer service. She is rude, she talks over me and I’m hardly able to get a word in edgewise. She spelled my name wrong on my documents even after I spelled it for her properly countless times, this caused a whole new issue with my bank. I have bill collectors from the hospital calling me demanding payment and Carrie Furgeson won’t do a single thing to help, or to get them paid. All of my documentation is in Colorado, my job is in Colorado, my address is in Colorado, all my Dr offices and appointments have been in Colorado and Carrie still managed to hold my claim because she wasn’t sure what state she needed to file it under. It’s been 6 weeks since my Injury and my company still hasn’t received the wage paperwork to fill out so they can get me my correct wages. When she’s not ignoring me she’s answering my questions with “I don’t know” well I don’t know how she got this job, because apparently she doesn’t know anything about it. She is a disgusting morose individual inside and out and I genuinely wish her the worst in all of her future endeavors. I highly recommend you don’t use this company. Please if you are a business owner and your looking into this company please don’t use them. I’m sure they have the cheapest payment and that’s why companies use them in the first place, but you will be doing your employees a grave disservice by forcing them to venture into this absolute dumpster fire of a company. I would rate 0/5 if possible but 1 was the lowest I was allowed.
Their general liability insurance purchase process is simply the best online experience I've ever had in my life!
As long as they cover your line of business, you're literally covered! best rates, best coverage, best online experience, best professionals, can't be happier that I chose them!