Insurance for Labor Unions

Several individuals have asked our opinion regarding the discussion that is going on about insurance coverages for Unions. It is important that there not be confusion about these coverages. Of course, each individual Union may have special circumstances that may affect what an insurance company may be willing to write.

The McLaughlin Company designed the Union Liability policy in order to address certain unique issues created by the Taft-Hartley and Landrum-Griffin Acts. We are most aware of the difficulties faced by Unions in obtaining insurance coverage, and on behalf of the International and Local Union clients around the country we represent, we have been able to address many of the concerns raised in recent e-mails. We also have had an on going dialogue with both AIG and Ulico about improvements that are needed in their respective Union Liability policies. These discussions have led to AIG issuing, unique to our clients, the "McLaughlin endorsement" which allows the Union client to pick attorneys from a list of approved union counsel, not corporate counsel, and lowers the premium for the individual labor leader endorsement. Ulico has partnered with State National to upgrade their policy to an "A" rating and we are working with them to make improvements to their policy, as well. We have never failed in securing UL coverage for a client.

A little background is required to understand the problem with General Liability Policies and Personal Injury and Advertising exclusions.. The commercial lines manual, which is the rules and regulations used by the insurance industry to have consistency in underwriting, states that Personal Injury and Advertising Injury is to be excluded for labor unions. They are in the same category as a number of advocacy and non-profit organizations; it is not just discriminatory against labor unions.

Some insurance companies that have little background with labor unions have written locals describing them not as labor unions but as employee associations. This was particularly true of State Farm, which ended up being involved in a number of Caterpillar cases. Their answer was to cancel all policies when they discovered this. They may be back to writing locals again because underwriters have changed and memories fade, but if there is another series of claims, they will again start canceling policies.

When Ulico was active in the Property and Casualty business and started writing labor unions, they did not exclude personal injury. Because of losses, they exited the Property and Casualty business and turned over their business to Seneca, which from the get-go, was adamant in following the commercial lines manual and excluding Personal Injury and Advertising Injury. Despite this atmosphere, w e have been successful in almost every case in convincing insurance companies to provide Personal Injury and Advertising Injury on national and international unions due to our experience and Knowledge of each client and the class in general.

When we designed the Union Liability Policy, we were able to get the companies to agree to provide Personal Injury and Advertising Injury. This is available to local unions. Again, we have never failed to place a Union Liability policy for a union, be it an International or local. There is a possible exclusion in the Union Liability Policy for strikes and boycotts which is troublesome in organizing campaigns.

You will still find some underwriters and carriers who are not familiar with this class of business and will occasionally provide Personal Injury coverage but most companies when approached to write a local union say "No" even though we find carriers that will refuse in the District of Columbia and in another part of the country will insure them.

We have also been successful in getting standard carriers, like St.Paul/Travelers, to cover Local Unions under a General Liability policy when there is a Union Liability Policy in place.
We have been at the forefront of getting Joint Apprentice Training Funds covered. For several years we have been working on a program for Apprenticeship and Training Funds. We want to create an insurance product that would coordinate all of a training fund’s liability coverages so that in theory, there would be no gaps or overlaps between the policies.

There are four areas in which gaps or overlaps most commonly occur. These are (1) personal injury liability and employment related suits, (2) fiduciary liability exposures, (3) professional liability exposures, and (4) publisher’s liability exposures. In addition we needed to be sure coverage would provided for claims alleging violation of ADA, ADEA, FMLA etc. that might arise from the selection criteria used by the Funds.

In a nutshell, Labor Unions are our niche, and we take pride in meeting our Union client's needs whatever they may be. We were the first insurance agency to write an insurance policy specific to a Union and are proud of our affiliation with the labor movement over the past 75 years.
That said we want everyone to have a clear understanding of what can and cannot be covered. If you are interested in learning more go to www.mclaughlin-online.com or e-mail info@mclaughlin-online.com either requesting a list of Questions and Answers about Union Liability coverage or with your specific question. We recently sent out a letter highlighting the increased need for Union Liability coverage as a result of the DOL's increased focus on LM-30's and issues of privacy.

Although this may be more than you want to know about the unique problems facing Labor Unions and coverages I hope it is helpful. We would welcome the opportunity to discuss any insurance issue with you, especially concerning the unique coverages needed by a Labor organization.

Webb