A recent industry trend is the use of “wrap up” insurance policies, which cover contractors and subcontractors working on large construction projects for a large variety of risks. As wrap up policies are used more often, here are ten things you should know about wrap-up insurance policies:

  1. Are a single risk management program for most or all participants in a project
  2. Normally are only utilized on large projects, such as $100 million and up
  3. Typically include worker’s compensation, employer’s liability, general and umbrella liability and builder’s risk/installation floater
  4. Typically exclude auto liability, contractor’s equipment and design liability
  5. Some advantages include cost savings due to volume, comprehensive coverages, improved safety and loss control and less finger pointing between insurers
  6. Some disadvantages include unfamiliarity with wrap-ups, disagreements about premiums and deductibles, and gaps in coverage if work performed off-site
  7. That the wrap-up manual, policy and your contract should be reviewed by your insurance broker, perhaps at additional cost
  8. OCIPs are a better choice when the owner plays an active role in the project
  9. CCIPs are a better choice when the contractor controls the contracting process
  10. Result in more administrative costs and challenges

Don Gregory spoke at the CFMA annual meeting in Chicago on June 29 on “OCIP/CCIP issues from a Subcontractor’s perspective.”