I have a customer who wants to have an addendum to our Fire All in One agreement, which happens to be your version.  Thoughts on this new paragraph since it is opening up our limitation of liability to the amount of insurance limits?  This is a Catholic church fire alarm system.
NO WAIVER OF SUBROGATION: OWNER does not waive or limit any rights of recovery against the CONTRACTOR/SERVICE PROVIDER for any damages resulting from the negligent acts of the CONTRACTOR/SERVICE PROVIDER associated with the contract. OWNER and CONTRACTOR/SERVICE PROVIDER agree that CONTRACTOR/SERVICE PROVIDER’S financial responsibility is limited to the amount of CONTRACTOR/SERVICE PROVIDER’S liability insurance in the event

    You should not agree to this change.  This change does more than increase your limitation of liability to your insurance limits.  This change increases your liability, not just the limits of that liability.
    The requested change is actually a mouthful.  It does more than address the indemnification provision.  In fact it starts with negating the waiver of subrogation provision in the Standard Form Fire All in One.  It then negates the exculpatory clause, because it states that owner is not limiting right of recovery for damages resulting from negligence.
    So the change effects:

  • waiver of subrogation clause
  • exculpatory clause
  • limitation of liabiltiy clause

    Your E&O carrier would not be happy if you agree to this change.  In fact, if you were to incorporate this change into your standard form your insurance carrier would not underwrite you and will drop you first chance it gets.  Your E&O insurance carrier agreed to provide you insurance knowing that you used the Standard Form Agreements because it knows that the contract will provide protection from liabliity and damages for which you and your carrier will be liable.  WIthout the contractual protective provisions it would be open season against alarm companies every time there was a loss.
    You did the right thing running this by me and I hope you follow my advice to decline this requested change.