Utility Strikes, One-Call Law and Insurance: Who Pays After a Dig-In

California's one-call law sits in Government Code section 4216 and the sections that follow it. Section 4216.2 has the excavator delineate the dig area before calling the regional notification center and give notice at least two working days, and no more than 14 calendar days, before digging. A ticket is valid for 28 days and must be renewed if work continues. Section 4216.4 requires the excavator to find the exact location of marked lines inside the tolerance zone with hand tools before using power equipment, with vacuum excavation allowed where the operator agrees, and to call 911 when a strike releases gas or hazardous liquid or damages a high priority installation.

Enforcement runs through the California Underground Facilities Safe Excavation Board, created by the Dig Safe Act of 2016 and now housed in the Office of Energy Infrastructure Safety. The board investigates incidents, develops excavation safety standards, coordinates education and enforces the one-call law. For a contractor, an investigation file built by the board can become evidence in the civil claim that follows, so cooperation and accurate records serve both proceedings.

Texas Utilities Code chapter 251 defines excavation as mechanized digging that disturbs soil to a depth of 16 inches or more, so shallow work can fall outside it. Section 251.151 requires notice to a notification center no earlier than the 14th day and no later than the 48th hour before excavation, excluding weekends and legal holidays. Section 251.157 gives operators of Class A facilities, which include electric, gas, petroleum and telecommunications lines, until the 48th hour to mark, and it states that an excavator who fully complied with the chapter is not liable for damage to a facility that was not marked as the chapter requires.

The Class B category matters for civil contractors. Water, slurry and sewage lines are Class B, and the statute requires Class A operators to participate in a notification center. Section 251.153 has the center warn the excavator that Class B facilities in the area may not receive the notice. A crew trenching beside an older city water main may hold a valid ticket and still have no marks on the line most likely to be in the way.

After a strike, section 251.159 requires the excavator to contact the operator immediately, delay backfilling until a repair schedule is agreed and leave repairs to the operator or its authorized agent. Section 251.201 sets a civil penalty of $500 to $1,000 for a first violation of the notice, notice-content or damage-reporting duties, with higher ranges for repeat violations. Section 251.008 preserves civil remedies for injury and property damage, so the penalty and the damage claim proceed separately. Chapter 251 also does not apply to a contractor working in the public right-of-way under a contract with the Texas Department of Transportation.

Arizona's underground facilities law begins at A.R.S. section 40-360.21. Section 40-360.22 requires white lining of the excavation area before a locate request, gives operators two working days to respond and keeps markings valid for 15 working days, with a duty to request remarking before that period ends if work continues. Large projects need notice of at least 15 business days or 21 calendar days and a coordination meeting to set a phased marking plan.

Arizona puts dollar consequences in the statute. Section 40-360.26 makes a person who damages a facility by failing to obtain locations, protect the facility or excavate carefully liable for the total cost of repair. Section 40-360.28 makes a violator liable to affected operators and excavators for damages its violation proximately caused, including economic loss. It also allows a civil penalty of up to $5,000. A further subsection provides that an excavator who complies with the article is not liable to the extent the loss arises from conduct the article regulates.

The economic loss language is the piece that changes the insurance answer. Business interruption claims from customers who lost fiber or power can exceed the repair bill, and whether a liability policy responds to them typically depends on how the policy defines property damage and loss of use.

Nevada's one-call law is NRS chapter 455. An excavator gives notice at least two working days and no more than 28 calendar days before work starts, white-marks the area and uses non-mechanical means to locate lines near the marks, and hand digging counts as excavation. High-consequence installations include water lines 18 inches or larger, pressurized sewage force mains and optical fiber lines.

The statute puts a price on compliance. An excavator that substantially complied is not liable for the cost of repairing a damaged line, while willful or repeated violations can draw Public Utilities Commission civil penalties of up to $2,500 a day, tripled near high-consequence lines. Penalties are commonly outside liability insurance, so the ticket and locate records are typically the first defense.

Damage to an operator's line is third-party property damage, which is the core of what a contractor's general liability policy may respond to. The questions are in the details. Some contractor forms exclude or limit explosion, collapse and underground property damage, and an underground utility installer should know whether its policy carries that limitation and whether it has been removed by endorsement. A line the contractor was installing or connecting may raise questions under the policy's exclusions for property in the insured's care or for its own work.

Loss of use is the second issue. Customers who lost service may claim business interruption without any physical damage to their own property, and liability forms usually address that through the definition of property damage, which can include loss of use of tangible property that was not physically injured. How a given claim fits depends on the facts and the form. Fines and statutory penalties are commonly outside what liability insurance pays, and the per-occurrence deductible applies to each strike, which matters for a crew that hits several small lines in a season.

Not every strike is a broken cable. A punctured gas line, a struck fuel line or a cracked sewer force main can release material that a general liability policy's pollution exclusion may reach. The resulting costs can include evacuation, soil removal, cleanup of a creek or storm system and claims from neighbors. Whether the GL responds, partly responds or excludes the loss depends on the exclusion's wording and any exceptions in it.

Contractors pollution liability is written to address pollution conditions arising from the contractor's operations, and it is commonly bought annually or for a specific project. For underground work, ask whether the policy responds to releases from third-party lines the contractor strikes, whether it includes transportation of contaminated spoils and how its deductible interacts with the GL deductible on a loss that touches both.

On most civil projects the strike claim does not stop with the excavator's insurer. The prime contract usually asks the contractor to indemnify the owner, and the subcontract asks the trade that dug to indemnify the prime. Those clauses can move the loss toward the party with the closest connection to the work regardless of where the operator first sends the invoice. Liability policies often address some contractual liability through the definition of an insured contract, but the scope of that grant varies by form.

The statutes add a counterweight. Texas section 251.157 and Arizona section 40-360.28 each protect an excavator that complied with the law from liability for damage that traces to the operator's failure to mark, and California's statute similarly allocates responsibility between excavators and operators. A contractor that can prove compliance may push the repair cost back to the operator, and its insurer may pursue the operator after paying. That recovery depends entirely on records made on the day of excavation.

Preparation for a strike claim starts before anyone calls 811. Underwriters reviewing an underground contractor commonly ask how tickets are tracked, how crews document marks and who is responsible for reporting damage, and a clear written process can support the submission as well as the defense.

• Ticket number, request date and the area described, matched to the actual dig footprint.
• Positive response records from each operator, including any that said they would not mark.
• Dated photos of marks and white lining before excavation begins.
• A potholing or hand-exposure log for every crossing inside the tolerance zone.
• Renewal or remark requests when work runs past the ticket's validity period.
• Time-stamped damage reports to the operator and, where required, to 911 and the notification center.