The Basics of Wrap-Up Insurance Policies
Before you start working on a construction project, it is first wise to know what insurance policies you will need to obtain. You may already know that you need wrap-up insurance to stay well protected throughout construction. However, there are options when it comes to wrap-ups. Take a look at the basics of wrap-up insurance so that you are better prepared for selecting your next policy.
Wrap-up insurance is an all-encompassing liability insurance policy that protects all of the contractors and subcontractors who work on a large project. A wrap-up is a risk management and financial product that provides greater control over construction exposures. Under a wrap-up, the sponsor provides insurance coverage, loss control, and claims management for themselves, general contractors, and subcontractors. As a result, each contractor removes the cost of insurance from their contract. This results in an effective and cost-efficient risk management program that covers construction projects.
There are two common types of wrap-up insurance coverage:
- Owner-controlled insurance program (OCIP): The program is sponsored by the owner of the project. The project owner is the first named insured, and the general contractor, subcontractor, and additional participants are named insureds.
- Contractor-controlled insurance program (CCIP): The general contractor sponsors and controls the program. The general contractor is the first named insured, and everyone else will also be named insured. Depending on the program, the project owner could be an additional insured or named insured.
In a wrap-up insurance program, the following coverages are often included:
- Workers’ Compensation
- General liability insurance
- Excess liability insurance
Wrap-up insurance programs are used most frequently for large, single-site projects, though a rolling wrap-up can be used to insure multiple projects under one handy program.
Whether you’re looking for wrap-up insurance, we can help. Contact a team representative at Nahai Insurance Services to discuss the most reliable insurance solutions for you and your project.