When you pave at a grade crossing or inside railroad right-of-way, two insurance questions arrive together. The railroad will usually make you buy a railroad protective liability policy that protects the railroad, not you. And the indemnity you sign in its entry agreement can fall outside your own general liability policy unless a railroads endorsement is attached.
Two coverages with the railroad in the name, protecting two different parties
A railroad protective liability policy and a railroads endorsement sound alike and do opposite jobs. The first is a separate policy you buy, in the railroad’s name, for the railroad. The second attaches to your own general liability policy and protects you for the promise you made to the railroad.
The Texas Department of Transportation’s Local Government Projects manual, in its railroad insurance provision for local projects in Texas, states it plainly: “Contractors are required to purchase railroad protective liability insurance when work under the contract is located in whole or in part within railroad right of way.” The next sentence settles whose policy it is: “The insurance is for the benefit of the railroad.” You pay the premium; the railroad is the party it protects.
Your own general liability policy stays in the picture as a third piece, and the entry agreement usually carries an indemnity running to the railroad. Each answers a different question: who is being sued, who promised to pay whom, and who pays for your own mistakes. All three sit in the same paving contractor insurance program, and none substitutes for another. A road owner can ask for a similar policy in its own name, called owners and contractors protective liability; the railroad’s version is a separate policy with its own terms.
What the federal-aid highway rule says the railroad’s policy covers
On federal-aid highway projects, the Federal Highway Administration’s rule on railroad-highway insurance protection sets out who buys the railroad’s policy and what it reaches. The rule, published in the Code of Federal Regulations under the subpart titled “Railroad-Highway Insurance Protection” (official annual edition on govinfo), says “railroad protective liability insurance shall be purchased on behalf of the railroad by the contractor.”
The purpose it describes is narrow: “Coverage shall be limited to damage suffered by the railroad on account of occurrences arising out of the work of the contractor on or about the railroad right-of-way, independent of the railroad’s general supervision or control”. Within that purpose it lists specific inclusions, among them “Personal property owned by or in the care, custody or control of the railroads;” and injury to your own people caused by the railroad’s acts, “regardless of the negligence of the railroad;”
The rule keeps your coverage apart from the railroad’s: “Protection to cover such liability of contractors shall be furnished under regular contractors’ public liability and property damage insurance policies issued in the names of the contractors.” It also addresses the amounts eligible for federal reimbursement and allows higher amounts on higher-risk projects; the amounts your job requires come from its own contract documents.
The rule governs federal-aid highway work within railroad right-of-way, not every job near a spur track, and it applies its standards “insofar as the insurance laws of the State will permit.” On private property, the railroad’s own agreement sets the terms.
How agencies carry the requirement into the bid documents
Agencies write the requirement into their own special provisions, each in its own words, so read the one attached to the job you are bidding.
The NYSDOT sample special note on railroads, a template for projects in New York, opens its insurance item with a sequence rule: “Before any work is started on the railroad company’s right-of-way, the contractor shall furnish:” and then requires “a policy of railroad protective liability insurance taken out singularly in the name of the railroad company identified as an owner/operator above.” Where more than one railroad uses the line, the note adds: “Each policy shall also name the railroad company(s) listed as having trackage rights.” The contractor pays for it, and “Amounts may vary according to each Railroad or project circumstances.”
The Iowa Department of Transportation’s railroad information sheets for local public agencies, written for local projects in Iowa, treat railroad protective insurance as its own bid item for each railroad involved.
Across these documents, the policy is written for a specific railroad and project, and it is a line in your bid. Have it quoted before bid day, not after award.
The right-of-entry agreement is a contract, and the indemnity lives there
Before you put a paver or a milling machine on railroad property, you need the railroad’s permission in writing. The Connecticut Department of Transportation’s Office of Rail, which manages state-owned rail right-of-way in Connecticut, says “A license or entry permit must be obtained from the Office of Rail prior to any entry upon, access, use or installation of any utilities or facilities within state-owned railroad right-of-way.” It also routes crossing work through review: “Projects located within state-owned railroad right-of-way or that include at-grade railroad crossings must be submitted to the Office of Rail for review.”
On a local project the agreement can be broader. The Iowa sheets say a project crossing a railroad may “need a new agreement covering construction and maintenance responsibilities, long-term insurance requirements, inspection responsibilities, cost responsibilities, proposed plans, and specifications used for the project.”
Unlike a street-cut permit, a right-of-entry or project agreement is a contract you sign, and it commonly contains an indemnity running to the railroad. Our general liability page explains the difference between a permit and a contract under its heading on certificates and additional insureds. What matters here is narrower: the railroad indemnity is the piece your general liability form may not pick up. Whether that indemnity can be enforced, and how far, turns on the agreement’s wording, your state’s law and your policy; nothing here is legal advice.
The two railroad carve-outs in your general liability form
Your general liability policy covers liability you take on by contract only when the contract is an “insured contract”, and the standard definition removes two pieces tied to railroads. Under the standard ISO Commercial General Liability Coverage Form as commonly written (CG 00 01 04 13, the edition we read), exclusion 2.b of Coverage A removes liability “for which the insured is obligated to pay damages by reason of the assumption of liability in a contract or agreement.” It gives back liability assumed in an insured contract; how that definition treats indemnity clauses in general is covered under indemnity clauses and the insured contract. This section stays with the railroad pieces.
The first carve-out sits in paragraph V.9.c. An easement or license normally counts, but the form reads “Any easement or license agreement, except in connection with construction or demolition operations on or within” a stated distance of railroad property. If your work counts as construction operations inside that distance, the license you signed to get onto the property is not an insured contract under that paragraph.
The second sits in paragraph V.9.f, which brings in contracts “under which you assume the tort liability of another party to pay for “bodily injury” or “property damage” to a third person or organization.” Then it takes a piece back: “Paragraph f. does not include that part of any contract or agreement:” and the first item is the part “That indemnifies a railroad for “bodily injury” or “property damage” arising out of construction or demolition operations” within a stated distance of railroad property and “affecting any railroad bridge or trestle, tracks, road-beds, tunnel, underpass or crossing”.
A crossing, road-beds, tracks and an underpass are all on that list, and resurfacing a grade-crossing approach is the kind of work those words describe. Whether a particular job falls inside them depends on the facts and the wording, so read them before the work starts. The exclusion never reaches liability “That the insured would have in the absence of the contract or agreement”, so your own negligence is untouched.
The railroads endorsement and its limited version
ISO publishes an endorsement that restores both railroad pieces for a named railroad and job site. The endorsement titled Contractual Liability – Railroads (CG 24 17 10 01 as commonly written; that edition is the only one we were able to read, and it is older than the general liability form above, so check the edition on your own forms schedule) begins: “With respect to operations performed for, or affecting, a Scheduled Railroad at a Designated Job Site, the definition of “insured contract” in the Definitions section is replaced by the following:”
In the replacement definition, paragraph c reads simply “Any easement or license agreement;” with no railroad exception. The carve-outs under paragraph f shrink to two, both aimed at design professionals, the first beginning “That indemnifies an architect, engineer or surveyor for injury or damage arising out of:” The railroad indemnity carve-out is gone.
A narrower version, Limited Contractual Liability – Railroads (CG 24 27 04 13, the edition we read), keeps the same schedule, lead-in and restored paragraph c, but limits paragraph f. The assumed tort liability counts only “provided the “bodily injury” or “property damage” is caused, in whole or in part, by you or those acting on your behalf.” It adds: “However, such part of a contract or agreement shall only be considered an “insured contract” to the extent your assumption of the tort liability is permitted by law.”
So the first endorsement restores the railroad indemnity with the base form’s full tort-assumption wording, and the limited one restores it only where the fault is at least partly yours. Which one your policy carries is a forms schedule question; none of the sources we read says which one a railroad requires.
Flaggers, work trains and the railroad’s own people on your job
Railroad work brings railroad employees onto your site, and the railroad’s policy reaches some of their negligence. The Iowa sheets say “Track Protection Services (Flagging) is generally required during any operation involving direct and potential interference with the railroad’s tracks or traffic.” The triggers they list include “fouling of railroad operating clearances, reasonable proximity of accidental hazard to railroad traffic” and “any work over or under any railroad track”. One railroad’s sheet adds: “The Contractor is billed directly by the Railroad.”
The federal rule lists railroad employees whose negligence the railroad’s policy includes: “Any supervisory employee of the railroad at the job site;” crews on “work trains or other railroad equipment at the job site which are assigned exclusively to the contractor”, and employees specifically loaned or assigned for accident prevention or property protection. That is the railroad’s policy responding for the railroad’s people. It does not turn a railroad crew into part of your workforce.
This reaches beyond road crews. A striping crew marking a crossing, or a sealcoating crew on a lot whose edge is railroad property, can trigger the same flagging and entry requirements once the work touches the right-of-way.
Scheduling the railroad and the job site before you mobilize
Both endorsements work only where their schedule says: a Scheduled Railroad and a Designated Job Site, or the declarations if those entries are blank. A new crossing or a different railroad means updating the schedule before the work starts.
A workable order for any job that touches the tracks:
- Read the insurance and indemnity articles of the agreement as soon as it arrives.
- List every railroad that must be named, including any with trackage rights.
- Have the protective policy quoted in the railroad’s name, and plan the evidence; the federal rule adds “The contractor shall also furnish a copy of such evidence to the railroad or railroads involved.”
- Confirm a railroads endorsement on your general liability, scheduled for that railroad and job site.
- Keep every policy in force until the work is completed and accepted.
Real-World Scenario: A paving contractor wins a county job to mill and overlay a rural road, including the approaches to an at-grade crossing. The special provision calls for a railroad protective policy in the railroad’s name, and the railroad sends a right-of-entry agreement with an indemnity running to it. Reading the agreement against the contractor’s forms, the agent finds no railroads endorsement on the general liability policy. The protective policy is placed, the endorsement is added with the railroad and the crossing scheduled, and only then does the crew mobilize.
Send us the railroad’s right-of-entry or project agreement along with your current forms schedule, and request a quote; we will line up the protective policy and the endorsement before your crew reaches the crossing.