Wrap Insurance Coverage

When you are the owner or general contractor on a large construction project, you have a lot to think about.  Completing the project on time and on budget, keeping your workers safe and making sure all subcontractors are doing quality work are only a few of your concerns. The last thing you want to worry about is whether or not your contractors and subcontractors are carrying the right kind of insurance.

A wrap insurance policy can help give you peace of mind knowing everyone involved in your project is insured properly. A wrap or wrap up insurance policy is a sweeping blanket coverage that protects the owner, the contractors and subcontractors.

There are two types of coverage:

• Owner-controlled insurance program (OCIP): The OCIP is set up by the owner of the project for the benefit of the builder or contractor to cover all listed contractors.
• Contractor-controlled insurance program (CCIP): The general contractor may use a CCIP to extend coverage to all the contractors and subcontractors signed up on the project.

The consolidated policy often includes a number of different types of policies, such as general liability insurance, excess liability, worker’s compensation, builder’s risk coverage, commercial vehicle and property damage.

A construction wrap-up program can insure either a single project or, in the case of a “rolling wrap-up,” several designated projects.

Benefits of Wrap Coverage

Consolidated Coverage

Wrap insurance policies ensure that everyone who steps onto the job site and is enrolled in the program are covered. Project owners and General Contractors most often do not have the time nor the desire to comb through every contractor’s insurance policy to ensure they have adequate coverage and limits. Any gaps in coverage can lead to legal battles and delays in construction. A Wrap insurance policy provides a singular program safeguarding all parties involved.

Cost Savings

Cost savings is a key factor in choosing Wrap Up programs. Contractors typically factor in the cost of insurance, marked up for profit and overhead, into their bids which can run about 2% to 4% of construction costs. Because the contractors will be covered under a Wrap policy and not their own General Liability policy, the Wrap sponsor uses Bid Credits or Bid Reductions, to fund the costs of the Wrap insurance policy. A single Wrap policy may significantly reduce insurance markups on a project.

Fewer Claims and Delays

Centralized safety and risk management services included in the policy reduce frequency and severity of claims. In the unfortunate event of a claim, there is only one insurer, resulting in efficient claims processing. A Wrap Up program can also reduce legal costs associated with a claim by removing expenses associated with cross-complaints, a common element of a construction claim under the traditional multi-policy model.

Alliance West Insurance, Inc. and our partners specialize in Construction Insurance and we understand that implementing an insurance policy for a large-scale construction project can be a complicated task. We are equipped and ready to find a solution to fit all your needs. Contact Alliance West Insurance, Inc. today and let us partner with you on your next project.