Waiver of Our Right to Recover
A workers compensation endorsement waiving the insurer's subrogation rights against a specified party, commonly required by upstream contracts.
What It Is
The Waiver of Our Right to Recover From Others Endorsement (WC 00 03 13 or equivalent) is a workers compensation endorsement that waives the insurer's right to subrogate against a specified party. On the standard workers comp policy, if the insurer pays a claim for an injured employee, it can pursue recovery from any third party that caused or contributed to the injury. This endorsement waives that right for the named party.
This endorsement is commonly required in construction contracts, where a GC requires subcontractors to waive their workers comp carrier's subrogation rights against the GC. Without the waiver, if a sub's employee is injured partly due to the GC's negligence, the sub's workers comp carrier could pursue the GC for reimbursement.
Unlike waiver of subrogation endorsements on CGL policies (which are often included at no charge), workers comp waivers of subrogation typically carry an additional premium charge — usually 2-5% of the workers comp premium for a blanket waiver or a per-certificate charge for specific waivers.
Why It Matters for Brokers
Workers comp waiver of subrogation is one of the "big three" contract requirements for subcontractors (alongside additional insured and CGL waiver of subrogation). Brokers must secure this endorsement to meet contract requirements, and they must disclose the associated premium cost to the client. The premium charge can be significant for large workers comp accounts. Blanket waivers are more cost-effective than individual waivers for clients with many contracts.
Real-World Example
A concrete subcontractor with $180,000 in annual workers comp premium works for 15 different GCs, each requiring a waiver of subrogation on workers comp. Individual waivers would require 15 separate endorsement requests. A blanket waiver costs 3% of premium — $5,400 per year — but covers all 15 GCs automatically. Without the waiver, when an employee is injured due partly to a GC's failure to barricade a floor opening, the sub's WC carrier pays $210,000 in benefits and then sues the GC for recovery. The waiver prevents this inter-party litigation.
Common Mistakes
- 1Not disclosing the additional premium cost of the workers comp waiver of subrogation to the client before requesting the endorsement.
- 2Requesting individual waivers for each GC when a blanket waiver would be more cost-effective for clients with many contracts.
- 3Issuing certificates showing waiver of subrogation on workers comp without verifying that the endorsement has been added and the additional premium has been charged.
How brokerageaudit.com Handles This
Policy Checker identifies the Waiver of Our Right to Recover endorsement on workers comp policies and notes whether it is blanket or specific. COI Manager prevents the waiver of subrogation box from being checked in the workers comp section of certificates unless the endorsement is verified. It also calculates and displays the estimated premium cost of requested waivers.