RiskProNet News

 

Three Ways to Make Wrap Administration Easier

Three types of third-party firms can make the administration of wrap-up construction insurance policies easier. These are the suggestions from Bob Pedersen, AVP, of Chicago’s Brown & Riding Insurance Services, Inc., a wholesale broker specializing in construction.

  • Wrap Administrator –Third-party firms will administer the wrap-up policy and handle the enrollment of all parties.
  • Quality Assurance/Quality Control firm – These companies, usually owned by engineers or former contractors, provide peer review. They will take photos of good construction procedures as work progresses, so that the contractor can have a file showing the quality control if a construction defect claim arises.
  • Coverage Counsel – Having the insured’s legal counsel review the policy in advance is important, particularly in major projects.

Be cautious of general contractors that offer to provide wrap-up coverage and may view it as a profit center. It is usually more economical for the project owner to provide the wrap-up coverage.

Pedersen’s talk was arranged by Don Aberbook, risk manager/in-house counsel at Moody Insurance Agency. See previous post on the advantages of wrap-up policies.