Insurance & LiensQuestion 1528 of 1605
A 'waiver of subrogation' clause between an owner and contractor generally means:
a.The owner waives the right to a completed project
b.The contractor waives its mechanics lien rights
c.The insurer waives all coverage
d.Their insurers agree not to pursue each other to recover amounts paid for covered losses
Explanation
A waiver of subrogation prevents each party's insurer from suing the other party to recover a covered loss, reducing litigation between project participants. It is a common risk-allocation tool in construction contracts, often paired with builder's risk coverage.
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Related questions on this topic
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- Which of the following is TRUE about the difference between the CSLB contractor's license bond and a project performance bond?
Last reviewed: · editorial process
Sen Lin, PrepPass Founder · Verified against California CSLB Contractor License Law & Business Exam · How we review
Reviewed by Abraham Chen — Licensed California General Contractor (CSLB License #1101856 — verify)