2018 RIMS

5 Trends to Watch in Construction Technology

Sensors, 3D laser scanning, virtual reality and more are reshaping the traditional job site.
By: | April 18, 2018 • 5 min read
Topics: Construction | RIMS

Construction is not the first industry to come to mind as a user of cutting edge technology, but that’s beginning to change.  As in health care, manufacturing, transportation and many other sectors, new technologies are offering a way for contractors to do things safer and more efficiently while mitigating risk. Tom Grandmaison, EVP and Construction Industry Leader, AIG, sat down with Risk & Insurance at the annual RIMS conference and exhibition in San Antonio to discuss some of the most promising construction technologies on the horizon.


1. Wearables

Perhaps the most common form of modern technology appearing on job sites, wearable trackers are meant to improve worker safety and reduce workers’ compensation costs. They can alert supervisors when a worker is injured, getting help to them more quickly, but they also perform ergonomic functions like monitoring body position while lifting, reaching, bending and twisting.

“Sprains and strains are a big driver of workers’ comp claims and costs,” Grandmaison said.

Some wearable devices can track heart rate and body temperature to indicate when a worker is overheating. Others measure elevation – data that may come into play during investigation of a fall. Still others, like goggles, can record visual data and transmit it to a site supervisor or project manager on the ground, making it easier to communicate should a problem arise.

“There’s an emerging industrial wearables sector, with about 10-15 vendors out there bringing these products to market,” Grandmaison said

2. Building Sensors

Property sensors can help avoid costly losses caused by water infiltration.

“There’s a variety of different industrial sensors available, but the area we’re focused on is environmental sensors – things that track water, moisture and temperature,” Grandmaison said. “We had a number of claims in recent years where projects in either very hot or very cold areas were nearly complete, and then a pipe burst. When water seeps out unabated, it causes massive problems.”

Tom Grandmaison, executive vice president and construction industry leader, AIG

Building sensors that monitor temperature fluctuations or the presence of moisture can alert safety supervisors, security, or project owners and managers when conditions go awry. Stopping a leak early can save thousands in materials and labor costs.

“Sensors are generally inexpensive, and there’s great value there to prevent major losses,” Grandmaison said.

3. Radio Frequency Identification

The physical challenge of moving workers around on a job site introduces inefficiency.

“One thing we hear frequently, on bigger sites in congested city areas, is that getting workers on the lifts to get them up to the floors they’re supposed to work on – is often very difficult. It can take 45 minutes to get some of the workers to the top floor of a building,” Grandmaison said.

Radio frequency identification (RFID)  technology allows contractors to map worker movement, observing where people are working and for how long. This enables them to better plan project sequences to minimize time wasted getting from one area to another, or devise ways to better transport workers around the job site.

4. Virtual Reality

Virtual reality training modules give workers a taste of the hazardous conditions they’ll encounter on-site without putting them in harm’s way. One such module has trainees practice walking and performing tasks on steel beams hundreds of feet in the air. Perhaps no substitute for the real thing, but certainly a way to introduce new workers to a dangerous environment.

“It creates a realistic scenario for the worker and allows us to help train them in a completely safe environment,” Grandmaison said.

5. 3D Laser Scanning

Also known as LIDAR, 3D laser scanners use millions of beams of light to create three-dimensional blueprints of a finished room, measuring distances down to the millimeter. Contactors can compare these measurement to the original design to determine if the finished product was built exactly as intended.


“This allows for determination of the one truth, if you will. Contractors are leveraging this in a few different ways to minimize liability risk,” Grandmaison said. “The technology helps contractor’s document major milestones during the course of the construction.”

Construction defect claims have long tails and are a costly element of general liability risk, for which the best mitigation is thorough and detailed documentation. 3D scans provide a precise picture of completed work and can serve as a vital defense should a defect claim arise. Scans can also be taken at various stages throughout a project, documenting each major milestone, such as when the steel is erected, the floors are poured, or the roof is installed.

In instances when a project gets scuttled and a contractor replaced, these milestone scans mean builders have record of the work they completed before another contractor takes over. It could protect them from being blamed for another’s mistake if something goes wrong down the line, and helps them avoid unnecessary litigation.

We want the people we’re insuring to be safe and to build quality product, if we can help our customers lower their premiums, it’s a win-win.

Cost remains a barrier in implementing these technologies, and most are used primarily by larger contractors, but Grandmaison said the interest is there to make these tools more accessible. The entrance of younger workers could help drive the trend, and they tend to be more comfortable with technology and more open to being tracked on the job.

In addition to privacy concerns, these technologies also come with cyber, product defect and user error risks. But when used correctly, they can help shift contractors’ risk profiles for the better – something than benefits insureds and insurers alike.

“I envision a future where hopefully the use of these emerging technologies can bend the loss curve by multiples. We want the people we’re insuring to be safe and to build quality product, if we can help our customers lower their premiums, it’s a win-win,” Grandmaison said. “If we leverage these technologies correctly, it should deliver value for everyone.” &

Katie Dwyer is an associate editor at Risk & Insurance®. She can be reached at [email protected]

More from Risk & Insurance

More from Risk & Insurance

Risk Report: Manufacturing

More Robots Enter Into Manufacturing Industry

With more jobs utilizing technology advancements, manufacturing turns to cobots to help ease talent gaps.
By: | May 1, 2018 • 6 min read

The U.S. manufacturing industry is at a crossroads.

Faced with a shortfall of as many as two million workers between now and 2025, the sector needs to either reinvent itself by making it a more attractive career choice for college and high school graduates or face extinction. It also needs to shed its image as a dull, unfashionable place to work, where employees are stuck in dead-end repetitive jobs.


Added to that are the multiple risks caused by the increasing use of automation, sensors and collaborative robots (cobots) in the manufacturing process, including product defects and worker injuries. That’s not to mention the increased exposure to cyber attacks as manufacturers and their facilities become more globally interconnected through the use of smart technology.

If the industry wishes to continue to move forward at its current rapid pace, then manufacturers need to work with schools, governments and the community to provide educational outreach and apprenticeship programs. They must change the perception of the industry and attract new talent. They also need to understand and to mitigate the risks presented by the increased use of technology in the manufacturing process.

“Loss of knowledge due to movement of experienced workers, negative perception of the manufacturing industry and shortages of STEM (science, technology, engineering and math) and skilled production workers are driving the talent gap,” said Ben Dollar, principal, Deloitte Consulting.

“The risks associated with this are broad and span the entire value chain — [including]  limitations to innovation, product development, meeting production goals, developing suppliers, meeting customer demand and quality.”

The Talent Gap

Manufacturing companies are rapidly expanding. With too few skilled workers coming in to fill newly created positions, the talent gap is widening. That has been exacerbated by the gradual drain of knowledge and expertise as baby boomers retire and a decline in technical education programs in public high schools.

Ben Dollar, principal, Deloitte Consulting

“Most of the millennials want to work for an Amazon, Google or Yahoo, because they seem like fun places to work and there’s a real sense of community involvement,” said Dan Holden, manager of corporate risk and insurance, Daimler Trucks North America. “In contrast, the manufacturing industry represents the ‘old school’ where your father and grandfather used to work.

“But nothing could be further from the truth: We offer almost limitless opportunities in engineering and IT, working in fields such as electric cars and autonomous driving.”

To dispel this myth, Holden said Daimler’s Educational Outreach Program assists qualified organizations that support public high school educational programs in STEM, CTE (career technical education) and skilled trades’ career development.

It also runs weeklong technology schools in its manufacturing facilities to encourage students to consider manufacturing as a vocation, he said.

“It’s all essentially a way of introducing ourselves to the younger generation and to present them with an alternative and rewarding career choice,” he said. “It also gives us the opportunity to get across the message that just because we make heavy duty equipment doesn’t mean we can’t be a fun and educational place to work.”

Rise of the Cobot

Automation undoubtedly helps manufacturers increase output and improve efficiency by streamlining production lines. But it’s fraught with its own set of risks, including technical failure, a compromised manufacturing process or worse — shutting down entire assembly lines.


More technologically advanced machines also require more skilled workers to operate and maintain them. Their absence can in turn hinder the development of new manufacturing products and processes.

Christina Villena, vice president of risk solutions, The Hanover Insurance Group, said the main risk of using cobots is bodily injury to their human coworkers. These cobots are robots that share a physical workspace and interact with humans. To overcome the problem of potential injury, Villena said, cobots are placed in safety cages or use force-limited technology to prevent hazardous contact.

“With advancements in technology, such as the Cloud, there are going to be a host of cyber and other risks associated with them.” — David Carlson, U.S. manufacturing and automobile practice leader, Marsh

“Technology must be in place to prevent cobots from exerting excessive force against a human or exposing them to hazardous tools or chemicals,” she said. “Traditional robots operate within a safety cage to prevent dangerous contact. Failure or absence of these guards has led to injuries and even fatalities.”

The increasing use of interconnected devices and the Cloud to control and collect data from industrial control systems can also leave manufacturers exposed to hacking, said David Carlson, Marsh’s U.S. manufacturing and automobile practice leader. Given the relatively new nature of cyber as a risk, however, he said coverage is still a gray area that must be assessed further.

“With advancements in technology, such as the Cloud, there are going to be a host of cyber and other risks associated with them,” he said. “Therefore, companies need to think beyond the traditional risks, such as workers’ compensation and product liability.”

Another threat, said Bill Spiers, vice president, risk control consulting practice leader, Lockton Companies, is any malfunction of the software used to operate cobots. Then there is the machine not being able to cope with the increased workload when production is ramped up, he said.

“If your software goes wrong, it can stop the machine working or indeed the whole manufacturing process,” he said. “[Or] you might have a worker who is paid by how much they can produce in an hour who decides to turn up the dial, causing the machine to go into overdrive and malfunction.”

Potential Solutions

Spiers said risk managers need to produce a heatmap of their potential exposures in the workplace attached to the use of cobots in the manufacturing process, including safety and business interruption. This can also extend to cyber liability, he said.

“You need to understand the risk, if it’s controllable and, indeed, if it’s insurable,” he said. “By carrying out a full risk assessment, you can determine all of the relevant issues and prioritize them accordingly.”

By using collective learning to understand these issues, Joseph Mayo, president, JW Mayo Consulting, said companies can improve their safety and manufacturing processes.

“Companies need to work collaboratively as an industry to understand this new technology and the problems associated with it.” — Joseph Mayo, president, JW Mayo Consulting

“Companies need to work collaboratively as an industry to understand this new technology and the problems associated with it,” Mayo said. “They can also use detective controls to anticipate these issues and react accordingly by ensuring they have the appropriate controls and coverage in place to deal with them.”


Manufacturing risks today extend beyond traditional coverage, like workers’ compensation, property, equipment breakdown, automobile, general liability and business interruption, to new risks, such as cyber liability.

It’s key to use a specialized broker and carrier with extensive knowledge and experience of the industry’s unique risks.

Stacie Graham, senior vice president and general manager, Liberty Mutual’s national insurance central division, said there are five key steps companies need to take to protect themselves and their employees against these risks. They include teaching them how to use the equipment properly, maintaining the same high quality of product and having a back-up location, as well as having the right contractual insurance policy language in place and plugging any potential coverage gaps.

“Risk managers need to work closely with their broker and carrier to make sure that they have the right contractual controls in place,” she said. “Secondly, they need to carry out on-site visits to make sure that they have the right safety practices and to identify the potential claims that they need to mitigate against.” &

Alex Wright is a U.K.-based business journalist, who previously was deputy business editor at The Royal Gazette in Bermuda. You can reach him at [email protected]