April 2018 Exclusive Story
U.S. Production, Export Volumes Soaring
Editor’s Note: The past 12 months have seen a significant rebound in domestic drilling and completion activity levels. Leading indicators are that U.S. independent oil and gas operators plan to maintain that forward momentum in 2018, especially in the Wolfcamp, SCOOP/STACK, Eagle Ford and Marcellus/Utica plays.
Risk is inherent in exploration, drilling, completion and production workflows, making risk management a fundamental business necessity for oil and gas producers and their allied service and supply companies. How can companies proactively minimize risk exposures, especially in horizontal resource plays with multiwell pads? What trends are impacting the price and availability of upstream-specific insurance coverage? What steps can oil and gas companies take to ensure safe operations in all aspects of their businesses?
To find out, AOGR presented a series of questions to oil and gas insurance, well control and training experts. Panelists are Eric Boquist, president, Travelers Oil & Gas; Mohamed Amer, manager, well control engineering-technical services, Wild Well Control; and Landon Plumer, a producer with The IMA Financial Group Inc.
Questions are in italics, followed by the panelists’ responses.
Good News, Bad News
ERIC BOQUIST | Travelers Oil & Gas
Q: What do you see as the general market drivers defining upstream insurance trends in 2018? What factors outside the industry could impact oil and gas insurance in the year ahead?
BOQUIST: This year, the industry saw what you might call a “good news, bad news” scenario. The good news is that oil and gas companies are experiencing the return of activity and seeing a positive trajectory for the future. While there is opportunity for business and growth, it has forced many companies to face their “new normal” in an expedited way. Advances and changes in technology bring the need for new or updated equipment. And while technology may help businesses get the job done more efficiently, sometimes that comes at a price.
The costs to drill a well have come down significantly over the past few years, partly because of improvements in technology, equipment and operational efficiency. However, new well costs also have been driven down by increased competition among oil and gas contractors. As they look for ways to be more price competitive, they may be inclined to eliminate “soft costs” such as safety training and job site safety/management personnel. Cost-cutting measures like this can expose all parties, particularly operators, to more hazards and increase the risk of loss.
This phase of returned activity also brings an increased need for workers during a time in which the industry has seen a shortage of skilled labor. As the industry recovers, less-experienced workers may be needed to support the demand. A lack of experienced labor can increase the potential for injuries and affect the work’s quality. Taking the time to make sure you are hiring qualified workers is one of the most important steps in managing risk.
Continuing favorable economic conditions, such as a lower unemployment rate and lower gas prices, are resulting in more miles driven, higher road density and reduced distance between vehicles. In fact, the Federal Highway Administration estimates, U.S. driving topped 3.2 trillion miles in 2016, the fifth straight year of increased mileage on U.S. roads. This can result in a higher risk for auto accidents, and that can apply to various industries, including oil and gas.
Among the top driving risks, distraction has become increasingly commonplace and a greater concern for businesses. However, a survey of Travelers customers found, only 27 percent of businesses have a formal distracted-driving policy. We suggest companies create a driver policy (if they don’t already have one) and consider including the following topics:
Driver policies are important to have, but the real key is employee education and a strong commitment by management, starting at the highest levels. An effective policy is demonstrated and enforced.
Q: After several relatively quiet hurricane seasons, 2017 was the most expensive on record. The recovery within the oil and gas industry was amazingly swift, but will there be longer-term repercussions in upstream insurance?
BOQUIST: While we cannot predict the future, pricing or what impact the recent severe weather will have long term, these events reiterate the importance of businesses talking with their insurers to understand what the insurance company has to offer. When deciding which option best fits their insurance needs, businesses should have a solid understanding of an insurer’s claims process, tenure in the industry and financial stability to withstand events.
Q: As operators set their business plans for the new calendar year, what advice would you offer for their risk management initiatives? How can they tailor their insurance programs to meet the particular needs of their planned activities?
BOQUIST: A few things are important, including due diligence and thoroughness in hiring and training; understanding exactly what businesses are buying in terms of products and services; and the effective management of relationships with contractors and subcontractors hired to perform work. For example, it’s smart to have master service agreements that maintain an appropriate level of risk and responsibility with the contractors performing the work. Making sure those contractors and subcontractors maintain an adequate level of casualty insurance also is extremely important.
Environmental practices and policies also come to mind. Environmental liability policies should provide some level of protection for legacy issues (for example, gradual pollution) that could be difficult to uncover through normal preacquisition work.
Ongoing conversations are recommended with agents or brokers to ensure they are working with an insurance carrier that specializes in oil and gas exposures and understands how the needs of a particular business may change. For example, if companies are developing new reserves by drilling new wells, their focus should be on sound contractual risk-transfer practices and hiring contractors that have a strong track record of safety and job site controls to minimize risk. If a business is growing through the acquisition of existing wells from a third party, it should focus more on preacquisition due diligence work on the status and integrity of the wells, and on the strength of indemnification language in the purchase agreements.
Lastly, and I cannot stress this enough, we really believe that in order to be successful, a safety culture should begin at the highest level, with the company’s upper management setting effective safety policies and consistently holding employees accountable. Employees take their cues from their project supervisors and leaders. Therefore, it is important for managers to lead by example as well as hold workers accountable to established safety programs.
Q: With oil and gas companies continuing to focus on capital efficiency, what “best practices” can they adopt to help mitigate unnecessary risk (and cost) in their drilling, completion and production activities?
BOQUIST: With many sites having multiple things going on simultaneously (for example, drilling, fracturing, completion, different contractors on site), the need to manage and control the well site is more important than ever. Businesses will want to ensure that all contractors and employees on a site are practicing open communications so everyone understands the activity taking place on a given day.
This also makes hiring qualified contractors and having good contract terms even more critical. Develop a formal process for attracting qualified candidates; having a well-written job description detailing the essential functions of the position–including any physical demands–helps in finding the right workers for the job.
For a business owner, it has a lot to do with understanding the hiring, training and safety practices of the contractors and service providers that they are using to construct or service a well. Hiring the lowest bidders is not always cost-effective in the long run, especially if they are not safe and a loss occurs.
Tools are available online to help companies define job functions and associated safety risks. For instance, Travelers’ risk control portal provides a functional job analysis to help customers evaluate and understand a position’s tasks and physical demands. To identify safety issues, we recommend the job safety analysis tool, which helps companies understand the hazards associated with a specific job and helps define procedures to address potential exposures.
The interview process can be a critical component in helping select a candidate who will align with the company’s core safety values. For example, behavioral interviews give the interviewer the opportunity to assess a candidate’s responses to “what if” questions by using role-based scenarios, as well as assess critical thinking skills.
Q: Pad operations in horizontal resource plays have introduced new operational complexities in field development. What do you see as the biggest risk factors in pad operations? How are insurers responding to challenges unique to horizontal drilling and hydraulic fracturing in tight oil and shale gas plays?
BOQUIST: Conducting simultaneous operations on a well pad is a significant enhancement to oil and gas recovery, bringing many innovations to the production process on a well site. As the modern well pad comes closer to resembling the complexity of a high-rise construction project, the choreography and the process have become increasingly challenging.
The biggest risk factors lie with the number of contractors on a site at one time during these simultaneous operations (for example, a multiwell site typically will have a driller, a completion crew, a fracturing contractor, a wireline contractor and more). The operator, which is ultimately responsible for the project, should have contractor management controls in place to help minimize problems in each phase of well construction.
The drilling plan includes all of these players, but even the best-laid plans can be affected by delays, errors and unforeseen events. This is why it is so important that daily, broad job safety analyses and contractor safety meetings take place to discuss activities and exposures at length.
Q: Looking specifically at the potential for cross-well communication during pad site operations, what recommendations would you offer to help prevent communication-related well control issues?
BOQUIST: Communication between wells always has been an exposure when drilling new wells and can be complicated even further with multiwell sites. Knowing what wells are in the area is critical. We suggest mapping this out before beginning any multiwell site. Active wells typically are shut in and monitored during the well stimulation process. These wells should be monitored for changes in pressure.
Challenging The Status Quo
MOHAMED AMER | Wild Well Control Inc.
Q: How do you summarize well control risk on pad sites with multiple horizontal wells? What are the biggest risk factors? Are there any potential “blind spots” that oil and gas companies should be aware of during drilling and completion operations that could put a well or pad at higher risk of frac hits or other well control problems?
AMER: Well control risk mitigation starts with challenging the status quo. Multiwell pad drilling has become the standard drilling method in the lower-48, and with the cost synergies and efficiencies gained in the past few years, the key performance indicators (KPIs) have evolved to reflect a “cheaper and faster” model rather than “more efficient and safer” model. A comprehensive model should be developed to integrate planning through visualization, real-time and post-drilling data to help identify hidden lost times and deficiencies to improve the overall performance and well control safety aspects of the well.
There is more than one perspective on the well control risks associated with the multiwell pad developments, but risks on pad sites can be grouped into four categories: pad design, well construction, well placement and hydraulic fracturing.
Normally, pads are designed to achieve maximum operational efficiency during drilling, completion, remediation and production phases. Because of construction costs and environmental impact reduction efforts, pad design involves a compromise between minimized footprint and operational sizing requirements. It is common for well control considerations to be unaccounted for during the pad design phase. An example of the well considerations includes confining a well control incident to the problem well without inducing collateral damage to surrounding wells. Asset integrity, personnel safety and business continuity are all key risks during a well control event that have the potential of intensified impact on pad sites because of the increased number of high-density spacing wells.
With regard to well construction risks, pad wells strike a fine balance between operational efficiency and economic considerations. This can be attributed to the fact that the target formations in unconventional plays have very low permeabilities that do not allow for fluid flow while drilling without hydraulic fracturing. These tight formation conditions have resulted in what we call “complacent” well design. Well control capacities at hole section total depths have been altered from a primary concern (a “must have”) into secondary design criteria (a “nice to have”).
Because of the economic considerations, multiple wells can be drilled with no well control issues while one or two can cause costly well control problems. The higher risk appetite while drilling these wells can overrule safe well construction design aspects. Wells are now more often experiencing well control issues (e.g., gains masking losses) that involve low-permeability zones with higher pore pressures. In order to meet these challenges with a sustainable solution, a well control risk management program that identifies, analyzes and mitigates these issues should be adopted by operators with a commitment for long-term implementation.
Well placement issues historically have not been a significant risk for land wells because of the conventional wide spacing between wells. However, high-density multiwell pads now can contain as many as 40 wells in a tight pad space. This tight spacing poses risks ranging from missing the reservoir target to an inadvertent wellbore collision. We have experienced a number of jobs where an operator’s well inadvertently intersects another flowing well within the same pad or a nearby pad. The interwell fractures may cause rapid increases in both pressure and flowback rate on the intersected flowing well. The induced pressure and flow rates may result in an unexpected and dangerous well control event.
Current well placement technologies allow for enhanced control of these risks. The placement risks are more complicated when the need arises to drill a relief well to regain hydrostatic control of a blowout well that cannot be controlled from the surface because of surface obstruction, for example. In this scenario, the uncertainty associated with some of those wells is very large, which adds more time and cost for relief well drilling. The placement uncertainty can be addressed easily during the planning and executions phases of well construction, at a cheaper cost than the post-drilling phase.
Finally, hydraulic fracturing has brought several modifications to the casing design of a well. The maximum allowable surface pressure associated with the fracturing process is now accounted for during the design and selection process. The repeated thermal cycling of the casing during fracture stages and the induced fracturing pressures have taken a toll on the tension load limits. These risks, coupled with the typical risks of cementing jobs, have manifested in failed casing strings that lead to a sudden and dynamic high-pressure release into the backside annular space. Ultimately, this can evolve into a compromise of well control barriers at the surface, resulting in an uncontrolled release of hydrocarbons.
Q: What lessons should the industry learn from past well control incidents in horizontal resource plays? What common root causes can be identified in these incidents? What are the indicators that a problem may be developing?
AMER: Crossing the t’s and dotting the i’s will never fail. Former Secretary of State James A. Baker III’s mantra is the five p’s: “Proper preparation prevents poor performance.” We believe that practice leads to perfection. A well control risk management program is a classic application of Baker’s mantra. The sources of risk during drilling operations, for example, can be grouped into drilling contractor risks and well design risks.
Drilling contractor risks include those risks associated with rig crews, and those associated with rig equipment. A crew’s competency and experience level are usually directly proportional, with the great handover coming as a knowledge and competency gap looms. The industry has to be prepared to address this by developing robust on-site well control training programs that are based on real-life scenarios, rather than an old-fashioned instructor-led slide show.
In terms of rig equipment risk, with more high-pressure/high-temperature, narrow-margin wells designed and drilled these days, the more critical it becomes for the well control equipment to be rated appropriately and adequately rigged up to fit the application.
As far as mitigating well design risks, multiphase simulations that assess the well control capacities of casing design by coupling the geologic model, wellbore pressure analysis and reservoir flow analysis have proven to have a high level of accuracy in the past few years.
Q: There are examples of how some degree of well-to-well interaction during production can be beneficial to daily flow rates. What has the industry learned about well isolation during the production phase?
AMER: The industry has focused on reducing surface impact and environmental exposure. While the focus is on maximizing productivity, insufficient attention is being paid to the isolation of wells, similar to the offshore well environment. Shutting down production and isolating/securing a well for a well control event within a pad operation may pose a significant risk. For example, land wells seldom are equipped with surface controlled subsurface safety valves to shut in and secure flowing wells within a pad.
Q: Finally, how are HS&E training programs and best practices evolving to meet the specific needs of operations in horizontal tight oil and shale gas plays?
AMER: On-site training using well-specific content, rather than generic, irrelevant data, has been proven to add significant value to the well control emergency response preparedness of the field personnel, the critical first line of defense to any well control event. Preplanning is the best “best practice.”
Filling All The Gaps
LANDON PLUMER | The IMA Financial Group Inc.
Q: Oil and gas companies have a wide range of risk exposures. What are the biggest areas of concern for producer/operators in terms of having adequate insurance in place for all business liabilities and contingencies? How can operators ensure no gaps exist in their liability coverages?
PLUMER: It is important for producers to work with an insurance broker who can help them analyze risk from both a contractual and operational perspective. The stronger an operator’s contracts, the better the third-party risk can be managed. Good contract wording includes consistency in the indemnification and insurance provisions among contractors, especially at multiparty work sites, and receiving insurance protections from the other party to the contract, including additional insured status, primary wording and waivers of subrogation.
From an operational perspective, a number of factors impact risk, including how many people are performing services at a work site, the safety cultures of an operator and its contractors, value of third-party property at the site, the state in which operations are conducted, how close to residences and/or bodies of water the work is being performed, and many other factors.
The policy wordings for the operator’s commercial general liability (CGL) and umbrella/excess liability insurance policies are very important. The best wording is found in policies in which broker/carriers tailor them specifically for upstream operations. Examples of coverage and policy terms that are most customized include contractual liability, pollution liability, how the policy will respond when the insured is a nonoperating working interest owner and the “other insurance” provision.
Pollution coverage is the most complex because it typically is found in a number of liability policies (including CGL, umbrella/excess, auto and control of well), all of which must work well together in the event of a loss. Pollution liability coverage should be well understood by the broker so that gaps can be identified and explained to the operator and filled by specialty pollution legal liability insurance on an excess and difference-in-conditions basis if so desired by the operator. Another significant issue is limit adequacy for the insured’s operations, especially given that liability limits are subject to annual aggregates that can be eroded by large losses.
Where coverage is inadequate or where a gray area exists, there are often other types of policies that can respond. For example, where an operator has potential exposure for a large property loss–such as a drilling rig or frac spread–because it was not able to negotiate a favorable contract, it can shift that exposure to care, custody & control (CCC) coverage under a control of well policy. CCC wordings vary by carrier and must be reviewed carefully. Also, operators often have direct contractual responsibility for in-hole tools and coverage is limited under a CCC policy, although broader coverage is available under specialty in-hole tool programs.
Q: U.S. Occupational Safety & Health Administration data show that vehicle crashes are the leading cause of work-related fatalities in the upstream industry. According to one study, small oil and gas companies are at the greatest risk of vehicle-related incidents. What can operators do to reduce the risk of vehicle accidents on the job? What advice do you have for encouraging safety-conscious driving practices and implementing safe driving programs?
PLUMER: Thanks to the cultural phenomenon we live in created by technology, drivers are faced with many distractions, with cell phones and cognitive distractions being the two biggest obstacles. An ideal approach to reducing auto accidents on the job is to make sure all employees are trained properly in the areas of defensive, distracted and alert driving. These topics should be an integral part of the company’s safety manual and taught or refreshed on a yearly basis through in-house training or a third-party vendor.
Another key component of a great fleet program is having a distraction-free driving policy each driver must sign that eliminates using cell phones while driving. A successful program not only will run a yearly motor vehicle record report on each driver, but will run as many as four MVRs a year to ensure drivers are maintaining safe records while away from work.
While implementing safe driving programs is integral, creating a safety culture by which a company lives and exemplifies from the top down is the best way to ensure safe practices are followed throughout an organization. Best-in-class companies make safety a priority at all times. Safe driving practices should adhere to these guidelines:
Q: What specific policy elements should be contained in an effective fleet vehicle insurance program? Are there any optional vehicle coverages you recommend companies consider adding to their policies?
PLUMER: This response will focus primarily on the liability section of the business auto policy for which a number of important endorsements are available. Regarding pollution liability, form MCS-90 deals with the financial responsibility requirements imposed by the Motor Carrier Act of 1980. Most truckers subject to the act comply with these requirements by using federally mandated form MCS-90, which amends the auto policy to assure compliance as a motor carrier of property. With this endorsement, the policy agrees to pay, within the designated limits of liability, any final judgment recovered against the insured for public liability resulting from negligence in the operation, maintenance or use of its vehicles that fall under the act.
Nothing relieves the insurance company from paying a final judgment regardless of the insured’s financial condition, but form MCS-90 is not insurance. Under this form, the insured agrees to reimburse the insurance company for any payment the insurer would not have had to make under the terms of the basic (unendorsed) policy. Also, if a party to a contract is asking for additional insured status on the insured’s auto policy, form MCS-90 will not provide defense coverage for the additional insured in the event of a pollution spill that would be covered by the MCS-90 endorsement.
There is another endorsement that does provide insurance (true risk transfer) for pollution spills and additional insured status, including defense costs, when required by written contract, and that is the “auto broadened pollution” endorsement (ISO form CA 98 44). The endorsement amends the pollution exclusion to provide coverage for pollution costs or expenses in response to a request, demand, or regulatory requirement that the insured clean up or in any way respond to or assess the effects of pollutants that result from the upset, overturn or damage to a covered vehicle that is being used or maintained.
This endorsement also covers pollution costs or expenses resulting from a third-party claim or suit brought by or on behalf of a governmental authority for damages because of cleaning up, responding to, or assessing the effects of pollutants. Cleanup costs only are covered if they result from an accident that also causes bodily injury or property damage. This endorsement does not cover civil fines or penalties that may be assessed because of a pollution spill.
Regarding auto liability, there are three endorsements that can impact an operator’s employees who drive vehicles for company business. One is “employees as insureds” (ISO form CA 99 33), which adds coverage for employees if they are named in a suit when driving their personal vehicles on company business, with coverage applying excess over their personal auto insurance.
Another, “employee hired autos” endorsement (ISO form CA 20 54), broadens physical damage coverage for employees of the insured who hire or rent vehicles in their own names while on company business. This endorsement also extends liability protection to employees while they are operating vehicles that have been rented or hired in their names for company business. It requires that hired auto coverage for both physical damage and liability be in place.
The third endorsement to consider is “fellow employee” coverage (ISO CA 20 55), which removes the fellow employee exclusion from the auto policy so that it can respond on behalf of an at-fault employee for a vehicle-related injury to a fellow employee caused by a covered vehicle.
“Drive other car” coverage (ISO endorsement CA 99 10) is used when an employee (for example, an executive officer) does not carry personal auto insurance because he or she is provided with a company vehicle. Under this endorsement, individuals requiring coverage are specifically named. From a liability and physical damage perspective, the endorsement provides nonowned auto coverage for the named individual and his/her spouse for vehicles they do not own, or that are not owned by members of their household, which are in their care, custody or control. Physical damage coverage is provided only for private passenger vehicles.
From a physical damage perspective, “auto loan/lease gap” coverage (ISO form CA 20 71) should be considered since this endorsement changes the amount paid under the physical damage section of the auto policy to include the difference between the actual cash value of the damaged vehicle and the amount remaining on a loan or lease, but only when there is a total loss. This coverage enables insureds to satisfy their contractual requirements with either the loss payee/lienholder or lessor. Because vehicles depreciate quickly and the difference between actual cash value and the amount owed can be substantial, this endorsement should be considered for newly leased or purchased vehicles that are financed.
Q: Considering that many well activities are conducted by third-party service providers working on behalf of the operator on a contractual basis, how can operators work collaboratively with service providers to make certain all well site operational risks are covered? How can operators tailor property and equipment coverages to meet the variety of drilling, completion and production activities on active leases?
PLUMER: Oil field contracts should include indemnification provisions that set forth the allocation of risk between parties and include insurance provisions to back up the indemnities assumed by each party to the contract. In establishing the insurance requirements, the allocation of risk should be reviewed by the parties’ insurance brokers so that risk can be matched to the applicable insurance coverage. The insurance provisions should address the types of coverage, along with a more detailed explanation when important, such as the requirement for sudden and accidental pollution and underground resources liability coverage in the CGL, if applicable to the risk.
These provisions also should state the policy limits up to which each party seeks to be indemnified. Insurance protections also should be required, again to back up the indemnities. This is especially important in certain states with oil field anti-indemnity statutes, such as Texas and Louisiana. These protections should be tied to the risks and liabilities assumed by the party providing the protections and should include additional insured status, except as respects workers’ compensation and employers’ liability, primary and noncontributory wording, and waivers of subrogation on all policies.
The insurance provisions should require certificates of insurance (COI) as evidence of coverage, and these should be requested and reviewed annually as the various contractors’ insurance programs renew. Reviewing COIs is very important, or the operators may end up with inadequate protection from contractors, putting their own insurance programs and assets at risk. It is important for operators to develop a system for tracking master service agreements, drilling contracts and the COIs that back up the insurance requirements.
Regarding large property at a well site for which the operator may be contractually liable, insurance policies are available to operators that address the significant exposures that can exist at drilling and completion sites, depending on the indemnity provisions of the operator’s contracts. CCC insurance can be purchased as part of an operator’s extra expense (OEE)/control of well policy, up to relatively high limits, to cover the frac spread in the event an operator is legally or contractually liable under certain circumstances. Some CCC policies will cover the rig for those provisions of a drilling contract that make the operator responsible, such as unsound location, environmental loss or damage, etc.
Regarding OEE insurance, high limits are available for each occurrence and can be expanded with a multiwell pad endorsement to provide a higher limit in the event more than one well is impacted in a well control event. This endorsement is especially important if an operator is conducting simultaneous operations at a multiwell pad site.
Operators are often contractually responsible for pollution liability, including cleanup costs, bodily injury, property damage, and defense costs unless pollution emanates from the contractor’s equipment above the surface. CGL and umbrella/excess liability policies provide sudden and accidental pollution coverage that is tied to strict discovery and reporting provisions, but all policy wordings are different and should be carefully reviewed. Operators now have the ability to expand their pollution coverage to include gradual pollution, first- and third-party transportation, and nonowned disposal sites with a specialty pollution policy often called pollution legal liability (PLL). The best PLL policies will provide coverage that is excess and difference-in-conditions to the operator’s underlying liability policies.
In regard to production activities, operators can purchase an oil lease property policy under which they can cover the property at their lease sites. This policy can be expanded, or separate coverage can be purchased, for leased and rented equipment. The policy also can cover crude oil in tanks. It is important to review the scope of this coverage, especially if an operator’s equipment is exposed to potential flood or earthquake, as these perils sometimes need to be endorsed specifically.
Q: Finally, how are association-sponsored programs helping smaller companies better manage their insurance programs? What types of coverage are available through these programs? How would you summarize the benefits of association-sponsored insurance for smaller operators?
PLUMER: Association-sponsored insurance programs can be a great benefit for small and mid-sized operators. By joining a larger group, they can take advantage of economies of scale that likely would not exist otherwise. Aggregating premium affords association-sponsored insurance programs the scale to, in theory, spread risk among a larger pool of premium, and by doing so, obtain favorable rates and sometimes favorable coverage language from insurance carriers.
Property, auto physical damage and auto liability, workers’ compensation, general liability, and umbrella/excess policies typically are included in association-sponsored insurance programs. More specialized coverages such as operators’ extra expense, oil lease property, pollution legal liability, and inland marine coverages often are excluded.
Many factors determine if an operator should consider an association-sponsored program. It is important that your broker carefully review the program to understand how it is structured, what other companies are currently within the program, and how rates and coverages have changed historically. It also is important that you understand and properly vet the financial viability of the insurance carrier(s) providing coverage. Furthermore, and most importantly, your broker should carefully review to ensure the program has appropriate coverage language in place (especially regarding general liability, auto liability and umbrella/excess liability) and that coverage language is sufficient for any contractual/legal indemnity that either has been accepted or is unable to be negotiated away.