Owner or Contractor Controlled Insurance Programs (OCIP /
CCIP), referred to as “wrap-up” programs, have won growing
popularity with construction project owners during the last decade
due to wrap-ups’ ability to reduce losses and thereby lower the
cost of construction insurance. Wrap-ups are “all-in-one”
programs that combine most of the major insurance coverages needed
for a large construction project (or series of smaller projects)
into one program.
A lead insurance company provides the primary coverages that account
for the majority of the premium costs. Secondary insurance companies
provide excess insurance and, when part of a wrap-up, specialty
coverages such as environmental and professional liability
coverages.
Wrap-ups work because they consolidate insurance coverages into one
program, largely underwritten by one insurance company. Such a
program:
- Uses loss-sensitive coverage to provide financial
incentives to the owner / contractor to run a safe and
efficient operation.
- Offers potentially significant savings derived
through lower insurance costs when low losses result.
- Is simpler administratively due to the use of
fewer insurers.
- Uses only one loss-control program with a
project-wide inspection service which saves time and money
over traditional programs (that use multiple insurers and
inspectors).
- Reduces the cost of claims handling because one
group is in charge of all claims processing. Legal expenses
are lower since fewer attorneys handle all legal concerns
and requirements.
- Allows for standardization of the coverage for all
contractors on the job.
- Increases the opportunity for small contractors to
participate in the project.
If you would like to learn more about the benefits of such a
program please contact us. We would welcome the opportunity to
perform a feasibility study on your next large project (or series of
projects) at no cost to you
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