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fire inspection concerns / comment on mistakes in executed contract May 15, 2018

KEN KIRSCHENBAUM, ESQ
ALARM - SECURITY INDUSTRY LEGAL EMAIL NEWSLETTER / THE ALARM EXCHANGE
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fire inspection concerns / comment on mistakes in executed contract
May 15, 2018
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comment on mistakes in contract from May 8, 2018 article
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Ken,
    I would like to respond to your article on May 8, 2018 on mistakes in executed contracts.
    From a risk management perspective, you should have practices in place that reduce the potential for this to happen.  There are a lot of things you can do – peer review, contract checklists, annual review of contracts, etc.  Yes, these things add an extra step, but it could make all the difference down the road.  Check your limitation of liability clause EVERY TIME.  Watch where your decimal point is…yes, I am serious.  I have seen claims where a simple mistake like this took a claim from a couple hundred dollars to thousands, even hundreds of thousands.
    That being said, you can have all of the risk management in the world and still wind up with an error – we are human, errors happen.  If it is something you can rectify quickly, do so with full sign off of changes from the customer, but if it is something that you don’t see until it is too late, have E&O insurance.  You can reach out to Security America – we can help.  Contact Rhett Butler or Crystal Jacobs at 866-315-3838.
Best Regards,
Crystal Jacobs, RPLU | Vice President
US Risk Underwriters, partners with ESA & SARRG
866-315-3838
usrisk@securityamericarrg.com

www.securityamericarrg.com
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Response
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    I want to remind everyone that you no longer need to be a member of ESA to purchase insurance from Security America.  You won't find a carrier more involved in the alarm industry.  Give them call to compare your current policy.
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fire inspection concerns
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Ken
    We have been sub-contracting for a company that frequently has us perform fire alarm inspections. These inspections are typically for grocery stores. In some cases, we cannot reach some devices (mainly duct detectors). In the past we were simply making note of it on the NFPA72 but it has come to our attention that ALL devices are supposed to be checked annually- not just a percentage and we are concerned if anything were to happen to that store we would be liable. The company we perform the inspections for hasn’t complained or said anything.
    I spoke with above mentioned company who sends us this work and brought it to their attention. They still want us to perform the fire inspections and note on the inspection form what we can’t reach- like we have been doing. They are then going to provide the customer with ‘remote test switch’ proposal (and will hopefully have us install them if accepted). They are willing to sign a disclaimer accepting responsibility if anything were to happen - is there such a document that would protect us?  
Melissa
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Response
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    You can get an indemnification from the company hiring you.  You should have a 
Subcontract in place with the hiring company you providing the indemnification.  Indemnity is only worth what the indemnitor can end up covering, which is not necessarily the full damages or claim.  You need to take other precautions.  By the way, I am not commenting on whether you are leaving yourself exposed by not inspecting every component in the fire alarm system.  I take your word for it that all devices need to be inspected.  This is something you should know if you are doing fire alarm inspections.  
    
Perhaps the fire alarm experts can clarify this technical issue.
    But what you should also insist on as a subcontractor is that the company hiring you has a proper contract with the subscriber.  The Fire All in One covers inspection, and the protective provisions extend to both the company hiring you and its subcontractors, which in this case, is you.  Subcontractors rarely are careful enough to find out if the subscriber has signed a proper alarm contract.  As a subcontractor you should insist that the company hiring you give you a copy of the Fire All in One or whatever other contract it uses.  If it's not the Fire All in One you better make sure it protects you for your inspection work.  If it doesn't, you better beef up your E&O insurance - get more than you can afford, because you're going to need it one day.  If you're doing fire you should carry at least 5 million.  Give Security America a call and get a quote, then raise your prices.
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Ken Kirschenbaum,Esq
Kirschenbaum & Kirschenbaum PC
Attorneys at Law
200 Garden City Plaza
Garden City, NY 11530
516 747 6700 x 301
ken@kirschenbaumesq.com
516 747 6700
www.KirschenbaumEsq.com