Risk Management in Construction Contracts Part III

Those contractor and subcontractor entities performing construction work on the project should be required to carry automobile liability, commercial general liability (CGL) and workers compensation/ employers liability policies, as well as an excess liability policy providing coverage over the automobile and CGL policiesÔÇÖ limits. For those contractors and subcontractors performing any design-build functions, professional liability coverage also should be required.

While the liability coverage referenced above covers most project accidents resulting in (i) bodily injury and (ii) damage to property other than what is being constructed, in most cases it does not cover damage to the structure being built or the materials being used. This damage, however, can be covered by obtaining a ÔÇ£builder's riskÔÇØ policy. While it is sometimes possible to cover damage to construction projects under an owner's existing property policy.

Read the rest of the article in the India Cement & Construction Materials Journal Magazine, Issue 24.