Insurance Pre-Approval Program

Overview

Beginning in the fall of 2006, construction contracts advertised by Caltrans included a new provision that requires the submittal of Contractor’s general liability policy, excess liability policy, and a certificate of insurance for workers’ compensation and automobile liability as conditions of contract approval. Contractors who bid frequently and are awarded Caltrans construction projects are required to submit insurance information as a condition of contract approval for each contract. Often the information is the same for each contract. Providing duplicate information has created an administrative burden on the contracting community, the insurance community, and Caltrans.

Contractors have routinely suggested Caltrans adopt an annual insurance pre-approval program designed to minimize paperwork and administrative burdens placed on contractors who are awarded multiple projects each year.

How the Program Works

1. Prior to bidding a Caltrans job, contractors may request advance insurance approval by submitting complete copies of their insurance policies and required insurance certificates.

2. When Caltrans Office of Risk Management (ORM) verifies that the submitted insurance documents conform to the standard specifications and special provisions, Caltrans issues a certificate of pre-approved insurance. The pre-approval applies to all contracts with bid amounts up to the corresponding liability insurance policy limits approved pursuant to the table in Section 7-1.12 B (4) (b), “Liability Limits/Additional Insureds,” of the Standard Specifications.

3. When pre-approved contractors bid and are awarded a project, they may simply enclose the pre-approved insurance certificate along with the executed contract documents to the Office of Office Engineer.

4. Contractors do not need to re-submit copies of policies or certificates until those policies expire or until contractors bid and are awarded a project greater than the pre-approved construction value limit of the certificate.

Two methods to be pre-approved

Contractors can be pre-approved for insurance in one of two ways:

1. Upon Contract Award: The Contractor submits his complete insurance documentation to the Office of Office Engineer as required in the standard specifications and special provisions; along with the payment bond, performance bond, and executed contract documents. Note that all insurance documentation, including full copies of both the general liability and umbrella or excess liability policies, must be submitted electronically via CD-ROM. ORM reviews all submitted insurance documents against the requirements in the specifications. ORM may require additional documentation if submissions are incomplete or inadequate. Once approved, ORM issues a “Certificate of Approved Insurance.” This certificate verifies that the Caltrans’ insurance requirements have been met for a specific level of construction value; until such time any required policy in the specification expires.

2. Prior to bidding any project: A Contractor may submit an application for pre-Approved insurance. The application package should include complete insurance documentation to ORM in accordance with the Caltrans’ insurance specifications and the instructions provided at this website. When all documentation is verified and complete, Caltrans issues a “Certificate of Approved Insurance.” This certificate serves as evidence that the contractor’s insurance is valid for a specific level of construction value and that they have complied with Caltrans’ insurance provisions; until such time any required policy in the specification expires. When a contractor bids and is awarded a future contract, only the pre-approval certificate is submitted to the Office of Office Engineer; not copies of policies and certificates of insurance.