Construction Wrap-Up Programs > Benefits
In our last post, we took a closer look at the basics of a Controlled Insurance Program (CIP), commonly known as a “Wrap-Up,”, and what you clients really needed to know. Wrap-up insurance programs streamline the coverage process and allow various contractors and subcontractors to be covered during the duration of the project. In this article, we’re going to explore the benefits of these controlled insurance programs.
Cost savings are one of the main benefits of wrap-up insurance says Construction Executive. This benefit is derived primarily from the project owner’s bulk buying power, as it can purchase insurance coverage at a lower premium than if purchased piecemeal through individual contractors. Wrap-up insurance is also more cost efficient because a single insurer is the control point for all claims and can streamline claims processing. Additionally, wrap-up insurance allows owners to isolate the risk associated with construction away from their core operational insurance.
These wrap-up programs eliminate overlapping and duplicate coverages that are typical when numerous contractors buy their own individual insurance policies. Without a wrap-up policy, each contractor is protecting themselves from the same potential accident. Not only does this cause an issue for the contractors, but the respective insurance companies can dispute the claims and lead to expensive litigation.
Wraps ups ensure that there are no gaps in coverage, as well as no overlapping policies. What’s more, these policies will provide specialized coverages for the contractor, comprehensive workers’ compensation and general liability insurance. One centralized wrap-up program saves time and money for both parties.
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