Annual Meetings-2C. Mastery for Construction Professionals: Understanding Geotech, Blueprints, and Risk Management

2C. Mastery for Construction Professionals: Understanding Geotech, Blueprints, and Risk Management - Risk Manager Perspective

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Pdf Summary

The document provides insights from a risk manager's perspective on critical concerns in construction project management. It highlights three main areas of discussion: contract provisions related to Builder’s Risk (BR) policies, challenges with owner-placed BR policies, and effective project team communication strategies.

<strong>Contract Provisions:</strong> Ensuring proper coverage within contracts is essential. The document emphasizes defining which party provides coverage, extending it to all subcontractors, detailing obligations (including ‘All Risk’ coverage), and understanding the duration and scope of the policy. It also advises on securing the ability for policy review prior to binding, including a waiver of subrogation, and setting caps on contractor responsibility for deductibles, particularly regarding catastrophic (CAT) exposures.

<strong>Challenges with Owner-Placed Policies:</strong> Achieving the right coverage through owner-placed BR policies is crucial. The discussion highlights the need for policies that match or exceed the contractor’s own insurance placements, particularly when the contractor bears the risk of loss. It stresses the importance of acquiring copies of insurance policies and tracking expiration dates to ensure extensions are timely and adequate.

<strong>Project Team Communication:</strong> Supporting project teams involves developing an appropriate budget for insurance coverage and making use of detailed project information such as schedules and building types to understand cost drivers. It is vital to maintain coverage throughout the project's life, from start to the transfer of risk upon completion. Clear understanding of terminology, like Substantial Completion or Final Acceptance, is also necessary for effective communication.

Overall, the document underscores the criticality of insurance management, proactive communication, and detailed planning within construction projects to mitigate risks effectively.

Keywords

risk management

construction projects

Builder’s Risk policies

contract provisions

owner-placed policies

project team communication

insurance coverage

policy review

subrogation waiver

risk mitigation