Month: June 2015

If you’ve been running a construction business for long, you’ve probably been tempted to buy the first professional liability insurance plan your agent offers you—and renew it each year—rather than spend valuable time evaluating your options. After all, you have hundreds of other things to do—and most of them are likely more exciting than evaluating risk and estimating liability. However, having the right coverage in place when challenges arise is necessary if you want to remain solvent and avoid financial ruin.

Before your professional liability policy is up for renewal, we encourage you to consider the following:

No contractor should be without professional liability insurance. It’s your best form of protection from third-party claims of professional negligence due to acts, errors or omissions. Plus, it’s often included as a contractual requirement. Depending on the size and complexity of the project at hand, you may be required to purchase from $1 million to $10 million in professional liability coverage.

It can also protect you from claims related to the mismanagement of subcontractors, errors in your construction methods, inaccurate cost estimates, missing project completion deadlines and more.

If your revenues have decreased, you may still have a rate increase. Professional liability insurance underwriters concentrate on your potential risk of exposure, historical data, claim statistics and annual or projected revenues. Revenue fluctuations are common in the construction injury, but decreases in revenue often result in increases in insurance rate. That said, if your revenues increase, your insurance rate may actually decrease—assuming the rest of your work stays the same, i.e. you aren’t taking on new risks.

Other events may also trigger a rate increase. Material changes in services rendered may increase your exposure risks. Changes in the claims patterns of similar service providers may lead to a rate increase for you as well. And if you’ve made claims of your own in the past, including the previous policy term, they will be taken into consideration.

Fortunately, there are ways to keep rates lower. Taking on lower-risk projects can reduce your rates. Other ways to mitigate your risk exposure—and subsequently reduce the cost of your professional liability insurance policy—include employing a risk manager, employing a risk management firm, preparing a quality control manual and updating it annually, including “limitation of liability” provisions in your project contracts, having certified legal counsel review your contracts, and using subcontractors who have their own adequate levels of professional liability insurance.

Whether you’re purchasing professional liability insurance coverage for the first time or planning to renew a current policy, contact us today for further insight and the answers to all your construction risk management and insurance questions.

 

 

Globally, the construction industry is recognized as one of the most hazardous work environments. You may have the best jobsite safety program in the world, but without the commitment of your workers, it’s little more than words on paper—and words alone can do little to prevent accidents and injuries. Consider the following simple ways to improve your team’s safety attitude today.

Talk about safety every day. The more you reiterate the importance of safety and encourage your team—from entry-level workers to management—to discuss it, the more invested they will become in keeping your jobsite safe. You might do this by starting the workday with a brief safety review meeting or quizzing your workers on safety issues as you tour the jobsite.

Encourage safety suggestions. No one knows the jobsite better than the workers who spend their days there. Encourage them to report potential issues and recommend ways to make their jobs—and the jobsite—safer. You might do this by creating a reward program for workers who proactively implement improvements or eliminate safety risks.

Take safety actions promptly. You want your employees to care about safety, so show them it’s your top priority as well. Whenever they notify you about hazards, act promptly to correct the issue. This goes for minor safety problems as well as larger, more dangerous ones. Never ignore their reports, even if remedying the situation will put you behind schedule or otherwise disrupt work on the jobsite.

Invest in safety training. Sure, training new construction workers on jobsite safety—and periodically re-training old ones—takes time that could be spent on actual work. However, well-trained employees are more than worth it: they’ll have good safety attitudes, make safety a priority, and ultimately help you avoid expensive jobsite accidents and injuries.

Reward safe workers. While you should always be on the lookout for workers who are violating jobsite safety rules, it’s equally important to catch them in the act of following the program. Praise safe performance of duties frequently and loudly. Make safety a key component of annual performance appraisals, and consider tying jobsite safety compliance into raise and promotion decisions.

Set a positive example. Make sure your jobsite managers always set positive safety examples—both in actions and attitudes—for the rest of your workers. Workers will emulate the behavior of their supervisors, safe or otherwise.

The success of your construction company depends directly on the attitudes of your employees towards their own safety and that of their coworkers. We hope these suggestions help you make meaningful improvements in that regard. Please don’t hesitate to contact us for a jobsite safety program review or additional assistance.