Richard Forrest Smith, CEO of ECIC, a leading insurer for electrical construction and other specialist construction services in the United Kingdom, is urging contractors and companies providing MEP services to ensure they get the right coverage for 2021. He says it often doesn’t happen until contractors come in. To make the claim that they understand the true value of their insurance protection. Here it explains why and provides the most important tips when choosing contractor insurance. The saying goes, “Things can only get better,” and staying optimistic that the new year will be better for the construction industry – and the contractors working within it – means being prepared for all eventualities. Professional building services contractors and electricians face many potential risks that they need to protect themselves, their business, their customers, and their employees properly. The pandemic has also affected the industry, which means that many contractors are taking new types of contracts to weather the crisis, and some of them may fundamentally change their business image. And when it comes to accident claims, Injury and Fatalities statistics released by the Health and Safety Administration (HSE) in November 2020 show that construction industry workers had 61,000 non-fatal injuries and 40 fatal injuries in the year 2019/20. . In all, about 2.8% of workers sustained an injury – mainly slipping and falling, and falling from a height. Statistically, this is much higher than the rate seen in all other industries. As the economic pressure due to Covid-19 increases, companies are also likely to become more aggressive in seeking compensation for contractual disputes and other losses, something that usually increases the incidence of both public liability and professional compensation claims. Here are some of Richard Forrest-Smith’s top advice: – Find a good broker: If possible, a broker who works with other construction contractors and understands the industry. They will be able to advise based on the type of trade, type of typical project, volume of work, whether the contracts are for the public or private sector etc. Other contractors may be able to recommend a broker they use. Full disclosure: Contractors should ensure that they explain to their broker or insurance company the full scope of their activities and how they manage the risks associated with their business. Any contractor seeking insurance has a legal duty to make a full and fair presentation of its business to the insurance company. Mediators can explain this requirement in more detail and what information is required. Understand your limits: An insurance policy is a contract that details what is covered and what is excluded, financial limits, required control measures and other terms and conditions. Contractors need to fully understand this, and they should ask the broker or insurance company to explain covers and limits in detail. A change in business is a change in risk: contractors must inform the broker of any changes in their business, and not wait for the renewal to do so. During the past year, due to Covid-19, many contractors have had to change the type of contracts they have worked on. Moreover, if the type of business changes and the insurance is adjusted to reflect this, contractors returning to their previous contract type should not forget to change their insurance again. Check Coverage of Your Subcontractors: Contractors who use bona fide subcontractors should verify that the insurance cover that their subcontractors have is suitable for the work they do. Compliance with each contractor: Every individual involved in a project must be aware of and understand their health and safety responsibility, and the need to comply with any terms or requirements of the insurance policy. Regular reminders as part of toolbox conversations are a good idea. Audit trajectory: Comprehensive records of all training provided and instructions about contracts and incident reporting must be kept. The signed papers should ideally be kept for electronic records. The contractor’s insurance broker must be aware of all accidents so that he can provide expert guidance and support on any steps to take. Site safety assessments: Before undertaking any work on a particular site, risk assessments and road data must be shared with workers to ensure they are aware of the risks, contractor measures and necessary personal protective equipment. Legal Expense Insurance: With the cost of legal disputes in construction in the UK rising to an all-time high and the number of court cases rising sharply in the last year, consider getting statutory expense insurance specifically designed for the contractor market. Look for policies that cover commercial supply contract disputes, commercial registration protection, and commercial operator licensing disputes, as well as providing regulatory protection for trade and engineers. Class A: The financial strength of the chosen insurance company must be verified. Insurance companies receive ratings from credit agencies based on the company’s financial analysis and operations. With all the turmoil of the past year, some insurance company’s service standards are also under pressure. A mediator can provide advice on these important aspects. Taking the time to ensure that the company has adequate insurance coverage is vital. Claims can be rejected unexpectedly if the contractor does not have the proper cover, which can be disastrous for everyone involved. Get the right advice, get coverage of the required scale, and the contractor can go about their business without worry. For more information about insurance specifically for electrical and mechanical specialist construction services, contractors should speak to their broker or visit the ECIC website.
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