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Construction Practice Group Hears From Brian Siska, CNA

The aging workforce, combined with the shortage of skilled labor, is causing more severe construction accident claims and the trend is likely to continue. That was the prediction from Brian Siska, CNA construction industry leader – Mid-Atlantic and North East zones, in a talk to the RiskProNet Construction Practice Group in May.

The construction industry has rebounded from the economic crisis with construction starts up 6 percent in 2016. Residential building increased more than 16 percent and non-residential, more than 9 percent, in 2016.

Key concerns include the following:

  • Shortage of labor.
  • Advances in project delivery.
  • “Green” construction.
  • Marijuana legalization, presenting particular challenges when an injured employee has been prescribed medical marijuana. (Watch for an upcoming RiskProNet article on this.)
  • Prescription opioid abuse, which is considered responsible for a 25 percent increase in prescription drug costs.
  • Cyber liability, with small to mid-size contractors increasingly becoming targets.

The frequency of injuries has been decreasing, even as claims are becoming more severe. More are
involving legal representation. Claimants also tend to be older, and more often have preexisting conditions that can impact the ability to close a claim. Medicare liens are being billed more consistently, increasing claim costs. In additional, overall medical costs continue to rise.

Brian also shared these facts about construction claims:

  • Most residential claims are in California, Nevada and Florida.
  • Most residential claims are against contractors who specialize in other fields and are doing only incidental residential work.
  • 77 percent of construction defect claim losses are from roofers, general contractors and mechanical contractors. Mechanical contractors have fewer claims but they are typically more severe.

CNA offers two products that are difficult to find, Brian told the group.

These include faulty workmanship protection that includes the cost of tearing out defective materials and replacing them, as well as some types of pollution at the insured’s location.

Brian is based in Pittsburgh and can be reached at (412) 562-4119 (office), ( 412) 538-9037 (cell) or brian.siska@cna.com.

Graphics courtesy of CNA.

 

 

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