6 Risks for Renewable Energy Construction
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Construction has never been an easy business. There are plans to draw up, approvals to win, materials and heavy equipment to maneuver, workers to manage, and financiers to appease — usually within tight time constraints. Expanded opportunities at brownfields, increased value engineering requirements, and skilled labor shortages all add to the sector’s challenges.
“The complexity of construction exposures continues to rapidly increase,” said Bill Sullivan, Senior Vice President, Head of Construction Casualty, Berkshire Hathaway Specialty Insurance.
In this environment, contactors will want to reevaluate their insurance and risk management programs to ensure there are no coverage gaps, while at the same time addressing these emerging trends.
With the growth of urban centers in the U.S. and a scarcity of suitable building lots, contractors increasingly find opportunities in brownfield sites, which can be located in highly developed, densely populated areas. “At brownfield sites, contractors may have to deal with legacy pollution issues. They must be ready to respond to the possibility of such unknown site conditions. In addition, many brownfield redevelopments are high profile projects that local authorities have spent years nurturing,” Sullivan said.
Sullivan added, “Executing a project in a highly populated area means many potential impacted third parties. The contractor must negotiate and manage the impact work can have on the project’s neighbors. It’s a much different dynamic than working in a less populated setting.”
The growing demand for value engineering means contractors are taking on the responsibility to review each building system and component for value, quality, lifecycle and maintainability. They also maximize value for their customer by providing direction concerning alternative materials and construction methods.
“If the contractor recommends an alternate material that has a shorter lifecycle, it may wind up costing the customer more in the long run to replace that material. Because the contractor is the one who suggested the use of a specific material, they need to be aware that they have taken on a professional liability exposure they may not have had absent value engineering,” Sullivan said.
Shifting workforce demographics create another challenge for today’s contractors. On the one hand, contractors face a maturing workforce that is less experienced with new means and methods, while at the other end of the spectrum, contractors have new workers whose lack of experience can compromise project quality and exacerbate risks. Additionally, with respect to new workers, this inexperience can also create safety issues for both workers on-site and for the general public.
Against this backdrop of complex exposures, contractors are migrating to a new insurance approach that offers simplicity and enhanced protection. “In the past, contractors would typically secure separate coverages at the primary and excess levels from a portfolio of carriers. We’re now seeing customers and brokers looking at ways to achieve more seamless coverage from a single carrier. There is so much potential interplay between lines of coverage in construction that it’s important to have coordination between them,” Sullivan said.
One way to achieve integration is through the use of a single excess integrated follow form policy, which can schedule and follow multiple lines of underlying coverage, such as: general liability, environmental liability, employer’s liability, professional liability, and automobile liability (as opposed to having multiple separate insurance towers from numerous carriers). Aligning coverage through a single excess carrier may help to provide consistency in limits and tower attachment points and reduce coverage gaps. Perhaps most importantly, the integrated approach streamlines claims services through the single carrier, which avoids coverage disputes between multiple carriers providing different lines of coverage. Streamlined claims services also has the potential to reduce frictional claims expenses.
BHSI has been at the forefront in providing integrated excess solutions for contractors. The company brings to market several major advantages:
As Mr. Sullivan noted, “Our integrated excess solutions are not boilerplate programs. They are tailored to address unique challenges and meet the particular needs of each individual insured. We have the unique combination of experienced people, a strong balance sheet, a broad product and service portfolio, and a commitment to long-lasting customer relationships that is truly dynamic.”
To learn more, visit https://bhspecialty.com/.
This article was produced by the R&I Brand Studio, a unit of the advertising department of Risk & Insurance, in collaboration with Berkshire Hathaway Specialty Insurance. The editorial staff of Risk & Insurance had no role in its preparation.
Employee engagement, employee advocacy, employee participation — these are common threads running through the programs we honor this year in the 2017 Theodore Roosevelt Workers’ Compensation and Disability Management Awards, sponsored by PMA Companies.
A panel of judges — including workers’ comp executives who actively engage their own employees — selected this year’s winners on the basis of performance, sustainability, innovation and teamwork. The winners hail from different industries and regions, but all make people part of the solution to unique challenges.
Valley Health System is all-too keenly aware of the risk of violence in health care settings, running the gamut from disruptive patients to grieving, overwrought family members to mentally unstable active shooters.
Valley Health employs a proactive and comprehensive plan to respond to violent scenarios, involving its Code Atlas Team — 50 members of the clinical staff and security departments who undergo specialized training. Valley Health drills regularly, including intense annual active shooter drills that involve participation from local law enforcement.
The drills are unnerving for many, but the program is making a difference — the health system cut its workplace violence injuries in half in the course of just one year.
“We’re looking at patient safety and employee safety like never before,” said Barbara Schultz, director of employee health and wellness.
At Rochester Regional Health’s five hospitals and six long-term care facilities, a key loss driver was slips and falls. The system’s mandatory safety shoe program saw only moderate take-up, but the reason wasn’t clear.
Rather than force managers to write up non-compliant employees, senior manager of workers’ compensation and employee safety Monica Manske got proactive, using a survey as well as one-on-one communication to suss out the obstacles. After making changes based on the feedback, shoe compliance shot up from 35 percent to 85 percent, contributing to a 42 percent reduction in lost-time claims and a 46 percent reduction in injuries.
For the shoe program, as well as every RRH safety initiative, Manske’s team takes the same approach: engaging employees to teach and encourage safe behaviors rather than punishing them for lapses.
For some of this year’s Teddy winners, success was born of the company’s willingness to make dramatic program changes.
Delta Air Lines made two ambitious program changes since 2013. First it adopted an employee advocacy model for its disability and leave of absence programs. After tasting success, the company transitioned all lines including workers’ compensation to an integrated absence management program bundled under a single TPA.
While skeptics assume “employee advocacy” means more claims and higher costs, Delta answers with a reality that’s quite the opposite. A year after the transition, Delta reduced open claims from 3,479 to 1,367, with its total incurred amount decreased by $50.1 million — head and shoulders above its projected goals.
For the Massachusetts Port Authority, change meant ending the era of having a self-administered program and partnering with a TPA. It also meant switching from a guaranteed cost program to a self-insured program for a significant segment of its workforce.
Massport’s results make a great argument for embracing change: The organization saved $21 million over the past six years. Freeing up resources allowed Massport to increase focus on safety as well as medical management and chopped its medical costs per claim in half — even while allowing employees to choose their own health care providers.
Risk & Insurance® congratulates the 2017 Teddy Award winners and holds them in high esteem for their tireless commitment to a safe workforce that’s fully engaged in its own care. &
More coverage of the 2017 Teddy Award Winners and Honorable Mentions:
Advocacy Takes Off: At Delta Air Lines, putting employees first is the right thing to do, for employees and employer alike.
Proactive Approach to Employee Safety: The Valley Health System shifted its philosophy on workers’ compensation, putting employee and patient safety at the forefront.
Getting It Right: Better coordination of workers’ compensation risk management spelled success for the Massachusetts Port Authority.
Carrots: Not Sticks: At Rochester Regional Health, the workers’ comp and safety team champion employee engagement and positive reinforcement.
Fit for Duty: Recognizing parallels between athletes and public safety officials, the city of Denver made tailored fitness training part of its safety plan.
Triage, Transparency and Teamwork: When the City of Surprise, Ariz. got proactive about reining in its claims, it also took steps to get employees engaged in making things better for everyone.
A Lesson in Leadership: Shared responsibility, data analysis and a commitment to employees are the hallmarks of Benco Dental’s workers’ comp program.