ny contractor whose work crosses or is adjacent to railroad property has encountered the need for Railroad Protective Liability (RPL). The need arises from railroads requiring contractors to assume the cost of the railroad's liability resulting from the contractor's work.

The RPL policy is issued in the name of the railroad and no coverage is included for the contractor. Coverage applies to the work and job site as the "covered contract" on the policy declarations and only until the work is complete. RPL does not change the contractor's need to purchase commercial general liability insurance for the contractor's protection.

RPL is similar to owners and contractors protective liability coverage except RPL includes railroad contractual and Federal Employer's Liability Act coverage. The Insurance Services Office (ISO) introduced RPL coverage form CG 00 35 in 1986. Until then there had been no standard form.

The RPL policy contains two covers - liability (bodily injury and property damage) to third parties and physical damage to railroad property. There is a separate limit of liability for each coverage.

The ISO form follows the commercial general liability insuring agreement, but the seven exclusions define and create RPL. Each of the exclusions should be read carefully. Five principal points to consider are:

Contractual liability is excluded, but the exclusion "does not apply to liability for damages assumed in a contract or agreement that is a covered contract."

Coverage ends with the completion of the "work insured". Completed operations coverage is not included.

" Exclusion d." prevents the RPL policy from becoming a premises and operations policy for the railroad.

Workers' compensation is excluded, but the exclusion does not apply to any obligation under the Federal Employer's Liability Act, as amended.

Pollution liability "at or from the job location" is excluded.

The physical damage to property section provides physical damage coverage for the railroad's rolling stock and contents of rolling stock, railroad tracks, roadbeds, signals, bridges, and buildings.

RPL insurance is written by many companies. The standard market is an excellent source, but their underwriting procedures often prevent timely service. There are, however, specialty markets prepared to provide instant service. Most specialty markets are backed by Lloyd's reinsurance, but you should consider carefully the strength and reputation of the specialty market before placing your coverage.