Murphy’s Law in science states that if something has a possibility to go wrong, it most certainly will. This seems to suit exceptionally well for the construction industry.
As the owner of a construction site, you are vulnerable to many major losses, which could result in more than just financial setbacks.
You, along with your brand, could lose your credibility. This article has brief explanations about everything you need to do in order to save your construction sites from losses.
- Maintain accuracy and thoroughness in all your insurance certificates
Before allowing your contractors inside the site, you must make sure that they submit a valid certificate of insurance. However, most of these certificates do not explain in-depth the coverage and limits. This makes them seem adequate but when in reality they are not.
To reduce costs, most contractors acquire the cheapest possible insurances to allow themselves into your site. It is your responsibility to monitor the coverage grants and establish unacceptable exclusions. This applies to all the documents that your vendors submit.
- Hold your subcontractors responsible
few residential sites, most commercial constructions are not just expensive but enormous in scale. The project, overall, is so huge for a single person to bear all the blame.
As the owner of a site, you must hold your subcontractors responsible for at least a small portion of the overall loss deductible. Similarly, they must include general contractors (GCs) and GCs must again include owners in their insurance policy as additional insureds. This would decentralize the losses no matter how big or small they get.
- Develop a sound business judgment
Most subcontractors, developers, and GCs work alongside each other in mutual projects for months if not years. What was once a business relationship could soon turn personal?
You get to know each other on a personal level both inside and outside of the site. Nevertheless, you must not allow a bond of yours to cloud your business judgment. They can never compromise on their insurance coverages for the sake of profit no matter how strong your personal bonds may get.
- Establish realistic timelines
Haste makes waste is something we have been hearing all our lives. You either tend to make bad construction site decisions if you are behind schedule or had an unrealistic timeline from the start.
Most insurance agents lack the expertise to spot timelines when they seem unreasonable. In addition, if your timeline is too short, it could increase your cost of insurance to a completely different level. The insurance firm would now assume greater risk and would charge a lot to cover them all.
- Stay away from cost cutting that degrades the quality
The amount you pay for your insurance premium directly depends on the overall cost of your property. Therefore, a $200,000 property could cost twice as much to insure as a $100,000 property.
This can be one of the reasons why most contractors try to cut down the cost during construction. However, they do so by using cheaper materials that could degrade the quality of your property. Only an insurance expert could show you how to cut down costs without increasing risks.
- Hire a specialist to track your insurances
Expired insurance is no different from having no insurance at all. Luckily, most construction companies have begun to realize the importance of an insurance specialist.
They can examine your Gantt charts and other similar documents to assess how best to present a convincing package to an underwriter. Including an expert can reduce the premium amount that you pay for your insurance, deductibles, and mitigates risk.
Conclusion
A good insurer should also be able to coordinate insurances across various product lines. This would make sure that there are no coverage gaps and duplications across all the policies.
Nevertheless, wait! There are certain things that you must know before getting your site insured. Read this article: 6 Things You Need To Know Before Getting A Certificate Of Insurance For Your Commercial Property
Tracking your insurances to make sure they do not lapse is half the battle. Insurance tracking software is the easiest way to do it. Talk to our experts to Schedule a Free Demonstration to know how best you can use it to your advantage.