FOR Directional drilling firms, drilling contractors and well operators
Define the well-path service and decision authority
Directional well drilling requires a clear account of who plans the trajectory, supplies steering tools, interprets measurements and authorizes changes. The service firm may provide personnel and equipment within another contractor’s rig operation while the operator retains authority over the well plan. Do not let a single description such as drilling services obscure these distinct roles.
Identify the types of wells, operating territories, maximum planned depths and services actually performed. Distinguish planning advice from execution to an approved program. This page concerns oil-and-gas well trajectories; horizontal directional boring for pipeline or utility installation presents a different set of surface, utility-strike and crossing exposures.
Separate tool loss from damage to the well
A stuck assembly can produce several invoices: retrieval work, replacement tools, lost rig time, sidetracking and damage to other downhole property. The contractor’s equipment policy, contractual responsibility and any specialist well-related insurance may address different portions. A tool replacement limit should not be assumed to fund all consequences of losing the assembly.
Review downhole exclusions, depth or territory restrictions, valuation, rental obligations and the definition of property in the insured’s care. Ask how lost-in-hole charges are treated when the contractor owns the tool but the operator agrees to reimburse it. A contractual reimbursement promise is not proof that the party making it has responsive insurance.
Test an incorrect-trajectory allegation
An inaccurate survey or steering decision could lead to a dispute about a sidetrack, reservoir access or collision with another well. The relevant insurance questions differ from those arising from a dropped tool at the rig floor. Discuss professional services, damage to the particular work, loss of use and purely financial claims using the actual wording.
Consider who independently checks the measurements and who approves deviations. Record the operator’s instructions and the contractor’s warnings without suggesting that approval automatically transfers liability. If an alleged error creates a well-control event, specialist well-control arrangements and contractual indemnities require separate review; a general liability certificate cannot answer that question.
Build a defensible technical and insurance record
A useful submission includes service scopes, representative master service agreements, downhole equipment values, crew qualifications and documented survey validation. Explain how tool calibration, data transmission and changes to the drilling plan are controlled. Describe the involvement of subcontracted measurement providers and any remote specialists advising the site team.
At renewal or before a new basin, compare contemplated operations with policy descriptions and exclusions. Keep daily reports, accepted surveys and change approvals together so the sequence of decisions can be reconstructed after an incident. Agree on prompt reporting of a suspected error, even if its ultimate consequences are uncertain. This helps protect evidence and identify potentially relevant policies before a commercial dispute hardens.
Operational exposures & coverage review
These review points are educational interpretation, not promises of insurance coverage.
| Exposure | Insurance review |
|---|---|
| Lost-in-hole equipment | Distinguish replacement, fishing and rig-time obligations. |
| Trajectory error | Review professional services and resulting well damage. |
| Operator instructions | Retain changes, approvals and measurement records. |
Questions for your next review
- Who approves trajectory changes?
- Does the equipment program expressly address downhole use?
- Which policy is being relied on for an alleged survey error?
Related Montridge webinars
Pre-mobilization insurance review for an energy drilling contractor.
Energy operations
Energy Contractor Insurance Checklist: Before Mobilizing a Project
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Bring the operational details above into a coordinated review of your contracts, loss history and actual policy wording. Explore Montridge energy services insurance services for the related brokerage service.
Source references
Primary-source background informs the technical discussion. Insurance review questions are educational interpretation; a source link does not establish coverage or certify compliance.
OSHA identifies distinct well-service activities and associated pressure, equipment and personnel hazards.
Scope: United States; land-based oil and gas work · Source reviewed 2026-11-01
Insurer information distinguishes operator and nonoperator insurance interests; cited as background, not an appointment or offer.
Scope: United States; insurer educational/product overview · Source reviewed 2026-11-01
Prepared November 1, 2026. Confirm current requirements and their application to your work before relying on them. Specific insurance outcomes require review of the complete policy and endorsements.