Recently, Canada’s real estate market has been the subject
of national debate. As the market
remains in a frenzy, contractors and project owners continue to push
forward on new construction projects that add value to and take advantage of the
current market conditions. While experts continue to fear
that some regression is in order, the price of residential homes in Canada
has been on the rise for well over
a year now and contractors have followed suit. Canada’s
addiction to buying and building new houses has lead to more collaboration
in the construction industry, and as a result, new projects are being completed
at a much
faster pace. This has increased the level of risk for general contractors
and project owners, making it imperative for all parties to have project
protection liability coverage. Many large construction projects require
liability coverage for all contractors and subcontractors scheduled to work on
a project.
Every Construction Project is Unique
Each construction project is different, presenting unique risks and challenges.
In today’s construction industry, several contractors and subcontractors work
together to follow meticulously planned construction schedules. A typical
insurance submission for a construction project will include an application
detailing project class, location, size, project participants, experience, and
loss history, as well as copies of any relevant engineering reports. Finding
the right insurance policy for a specific project can be difficult for owners
and contractors alike, however, there are all-encompassing policies that can
protect any and all risks posed by a construction project.
Wrap-Up Liability Coverage
Wrap-Up liability coverage is an insurance policy that serves as protection for
all participants working on a project. While wrap-up insurance is typically
reserved for large undertakings, it can be useful for projects of any size, as it
provides protection for all physical assets, business income, liability
exposures, and employees that are associated with a particular project. Wrap-up
coverage was developed from a need to provide uniform coverage to all parties
in a project, while allowing coverage to apply to each insured separately. When
applied to a particular project, a Wrap-Up policy becomes the primary insurance
policy and holds precedence above all of the individual contractor’s liability
policies. Wrap-up coverage can go a long way towards providing the owner with
the protection and peace of mind necessary to undergo a major construction
project.
Current Conditions Pose Increased Risk
As the price of real estate continues to rise in Canada, contractors will be
incentivized to continue building homes at a record pace. New projects are
expected to finish faster than ever before, which leaves contractors,
subcontractors, and project owners susceptible to more risk. At the current pace,
project protection liability coverage becomes even more important for all
parties looking to manage the risk they incur when undertaking a particular
project.
With
Canada’s real estate market in such high demand, it has never been more
important to have project protection liability coverage. It is important to
disclose all relevant information to your insurance broker in order to ensure
that you are covered for all possible liabilities in a given project. Having
the right insurance policy can go a long way towards saving
your company millions of dollars in the event of an unforeseen event.