Components of a Construction Risk Management Plan

In creating a construction risk management plan, you have four basic methods of dealing with your risk.

  1. Avoid the risk by changing the project, adding resources, or increasing the time allowed for the project.
  2. Transfer the risk by contracting out portions of the project.
  3. Mitigate the risk by reducing the chance of a damaging event.
  4. Accept that there is a risk, and only address if it becomes an issue.

Your insurance helps you reduce your financial losses if you do have an accident on the project, but the most effective construction risk management plan starts before you ever step foot on the site. You need an insurance company that understands the specific risks your business faces when you hire subcontractors to do a portion of the work and work on a construction site.

The resources of your insurance company can help you decide the amount of risk you can afford and how to manage your project most effectively to reduce the risk. You’ll sleep at night knowing your business is protected and that you’ve done what you need to do.

Instead of complaining about the high cost of insurance, work with your insurance agent to find the right amount of coverage to meet your budget. Determine your construction risk management plan to manage costs while covering your company with adequate insurance. Tailor your insurance to meet your needs.

 

photo credit: Enterprise and Business Committee: Inquiry into tourism / Y Pwyllgor Menter a Busnes: Ymchwiliad i dwristiaeth (license)

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