Questions Businesses Need Answered Before Enrolling in an OCIP
Subcontractors all across the nation regularly enroll in an OCIP (Owner-Controlled Insurance Program). This program is an insurance policy that covers many of the participants in a construction project, including the developer/owner, general contractor, and subcontractors. Before enrolling in this form of wrap-up insurance, consider asking these questions.
What are the limits of coverage?
Work inside an OCIP wrap up program is commonly excluded on all contractor’s general liability policies. That means coverage is found almost entirely within the policy limits in the wrap-up program. Be aware of the total costs of construction relative to policy limits. Are there other projects being covered under the wrap-up insurance policy? Are the limits of insurance reinstated after a large loss?
What is covered? What’s excluded?
Wrap up programs offer coverage for both general liability and workers’ compensation. Many polices can include builder’s risk, professional, and pollution liability, too. Common exclusions are often commercial vehicle liability, commercial property, and inland marine insurance. Be sure you know the ins and outs of your coverage so that there are no surprises.
What deductible or Self-Insured Retention (SIR) is required?
There are limited protections for wrap participants regarding the amount of self-insured retentions and/or deductibles, particularly with public or commercial projects. For example, subcontractors must identify the size of the deductible and whether that contribution is shared or individual. When a subcontractor is unprepared, a deductible can throw off their balance sheet.
Is OCIP insurance right for me?
If you are managing a large construction project with several contractors and subcontractors, OCIP insurance could be right for you.
To have an expert assess your unique situation and help you decide on OCIP Insurance coverage, contact Nahai Insurance Services. Our staff of experienced wrap policy professionals can help you best protect your upcoming project.