Cell phone network towers face a broad range of risks for several parties. That’s why companies in the telecommunications industry need specialized telecom insurance.
Erecting and operating a cell tower exposes several parties to a range of different types of risk: personal, property, criminal and more. Telecom insurance policies have to cover all these risks. Let’s take a look at some of the basic requirements for a telecom insurance policy to protect your people as well as your valuable investment.
Coverage for all parties
The first thing a telecom insurance provider has to recognize is the number and range of different parties involved. These include:
- the owner of the property where the tower is located
- the owner of the cell tower itself
- the operators and users of the tower and its telecommunications systems
- workers who build, repair and maintain the tower and property
- neighboring property owners, residents and those who work nearby
- in rare cases, passers-by.
The risks themselves vary widely, from equipment malfunction, to personal injury, to automotive accidents — a tower in a busy city can be hit by a car.
Risks during construction
During the construction phase for a cell tower, telecom insurance must reflect the numbers of people and range of equipment involved. The policies should cover vehicles, equipment and tools, as well as general liability and coverage for theft and other crime, and the property and buildings the tower is being built on.
Telecom insurance must extend to all parties, including all subcontractors, subsidiaries and affiliate companies of the network operator, and the property owner and their employees. Look for a blanket waiver of subrogation favoring the tower owner, subsidiaries and affiliates, the contractor and subcontractors.
Risks after construction
Coverage should extend after the construction is completed, covering the property owner and tower operator, their equipment and employees.
Workers who climb cell towers to do repairs or maintenance face an extremely high accident rate. In 2008, the federal Occupational Safety and Health Administration (OSHA) called the job “the most dangerous in America,” due to the number of fatalities — more than ten times the rate for construction workers. Rigorous adherence to safety regulations has improved things since then. However, OSHA reported eight tower structure related fatalities in the U.S. in 2017.
In addition to falls, cell tower workers face other hazards, such as burns from powerful RF radiation.
This exposure to risk raises premiums for telecom insurance, and carriers have made their underwriting guidelines more stringent. Before signing an agreement with an insurance provider, check the policy for any gaps in coverage per contract, for products and completed operations, errors and omissions, action over exclusion, types of automobiles and other factors.
Talk to a telecom insurance specialist
While insurance can be complicated, remember that premiums should be based on exposure to risk. For example, a tower erected on a large parcel of otherwise unoccupied land would have less exposure, and therefore should have lower insurance costs than a large tower erected in a busy city neighborhood.
Before you sign a contract for telecom insurance, talk to an independent expert such as a broker with experience in the industry. A broker can point out gaps in coverage, or suggest riders or extensions to cover the risks in your particular circumstances. They can also guide you in multi-state coverage, where different laws and regulations can have a profound impact on telecom insurance.
With more than four decades of combined experience in the telecommunications industry, we understand the complexity of erecting and operating cell towers. Give us a call or send us an email to talk about your needs.