Construction is a complicated and risky business. Any construction business, however, can help manage its exposure to liability by taking preventive steps.

1. General Insurance and Bonding

A Commercial General Liability (CGL) insurance policy is the first line of defense against many common claims, and it forms the cornerstone of most contractors’ insurance programs.

If work performed by a subcontractor fails to meet the standard promised, coverage can still apply to the contractor for whom the work was performed. There is an exclusion that covers damaged work to a third party by a subcontractor working on behalf of a general contractor.

Make sure that your subcontractors are properly insured and bonded. Your company should be listed as an additional insured on the subcontractor’s Certificate of Insurance. In the absence of a surety bond, you can have your surety agent call a subcontractor’s surety or agent and obtain a verbal or written indication of the subcontractor’s ability to bond.

2. Safety Issues and Liability

Look at a subcontractor’s safety record before the bidding process begins. Find out whether the subcontractor has an established safety program.

A good safety program will:

• Have a written safety manual
• Provide safety training and monitoring
• Establish written safety procedures
• Include drug and alcohol testing

Create and continually reinforce a proactive safety culture on every project. Reward good safety performance on the part of subcontractors and have consequences for non-performance. Be willing to remove a subcontractor from a project if that’s what it takes.  Check out unknown subcontractors through the OSHA Web site (www.osha.gov). The site has a query tool that reveals inspection information by establishment, so you can see which companies have OSHA violations.

3. Scope of Subcontractor Work

Another way to head off trouble is to be sure that contracts clearly define and outline the scope of subcontractor responsibilities and how expenses will be billed. Include performance standards, costs and the target dates for completion of construction phases.

If unanticipated work arises that requires modification to the contract, define the procedures to be followed and how major additions, deletions and other changes to the project scope are to be handled.

Look to your insurance agent to partner with you to help proactively evaluate the risks and remedies for subcontractor non-performance. Define penalties and corrective actions. Additional insured endorsements can eliminate some risk.

4. Local Codes and Standards

Hire subcontractors who are familiar with local and regional construction codes and standards, as opposed to national subcontractors who
may not be familiar with the codes in a particular location.  

Many construction codes and standards vary by state. For example, if you are constructing a public works project in certain states, you must make sure the construction subcontractors you hire employ an appropriate number of apprentices to meet apprenticeship standards in that state.

Owners who desire less potential damage and continued use of the building in the event of earthquake, flood or other natural disaster may insist on higher standards for design, construction, and inspection. Consult with an insurance expert whenever you encounter a need for special standards.

Architectural Railings & Grilles, Inc.

CC&A obtained this client by assisting them with a prior audit. They were being charged for a reclassification of a class code and the carrier was going back to the original inception date, instead of the date that the carrier discovered the misclassification. Net result: Insured saved approximately $40,000.

Acme-McCrary.

This CC&A client, a manufacturing firm employing over 690 workers in three locations, completed one million hours without an employee missing work due to a work-related injury. Acme-McCrary worked in partnership with CC&A’s risk management specialist Scott Parrish to help develop their safety program.

Senior Quality Care, Inc.

CC&A was able to win this client’s business by getting them out of the Assigned Risk Pool. Their current agent informed them there were no markets. However, CC&A found one, saving the client $25,000. CC&A also corrected a prior audit, where the experience mod calculation was performed incorrectly, saving the client an additional $11,000. After a complete analysis of the client’s current insurance program, CC&A found several gaps in coverage, which CC&A corrected.

Carpenter, Cammack & Associates Trains More Than 1,000 Workers

Carpenter, Cammack & Associates, Inc. recently completed training of its one thousandth worker through the organization’s risk management courses.

The agency offers courses on workers’ compensation, job safety and OSHA regulations among others, to assist clients in the improvement of health and safety in the workplace. Courses are designed as part of specialized risk management programs to enhance productivity and reduce the cost of insurance to clients over the long term. 

“At Carpenter, Cammack & Associates, we know companies that take a proactive role in managing safety and health issues in the workplace typically enjoy more productivity and pay less for insurance coverage,” said Tom Carpenter, Chief Operating Officer at Carpenter, Cammack & Associates, Inc. “With this in mind, we provide a wide range of training workshops designed to assist any company in the improvement of workplace health and safety.” 

Mike Morketter Named Equity Partner

Chris Cammack, President of Carpenter, Cammack & Associates, Inc., has announced that Mike Morketter has been named an Equity Partner of the firm. Morketter works in the firm’s Fayetteville office and specializes in construction and manufacturing risk management. 

“Mike has been a major contributor within our firm for nine years, always providing quality service to our valued clients,” said Cammack. “I am confident that he will continue to prove his dedication to Carpenter, Cammack & Associates with his strong work ethic and positive attitude.”

Travelers Names Carpenter, Cammack & Associates An ELITE Agency In The Carolinas

Thomas Carpenter, Chief Operating Officer at Carpenter, Cammack & Associates, Inc., has announced that his firm has been named an ELITE Agency in the Carolinas by Travelers, a leading provider of property casualty insurance, surety products and risk management services. The firm earned this recognition because of its consistent history of success, superior potential for growth, and its unique alignment with Travelers’ business objectives. As a Travelers ELITE agency, CCA will receive additional tools and services to help improve its operation practices and prepare for future growth. 

“Travelers is a world leader in the insurance industry, and it is an honor to be named to its highly selective list of ELITE agencies,” said Carpenter. “This achievement is a testament to the hard work of our staff and the loyalty of our clients. This new status will enable us to improve client service and will help to facilitate our future growth.”

1. Overexertion injuries brought on by excessive pushing, pulling, holding, carrying or throwing of objects
   

2. Falls on the same level
   

3. Bodily reaction injuries resulting from bending,
   climbing, loss of balance and slipping without falling
   

4. Falls to lower levels, such as from a ladder or over a railing
   

5. Being struck by an object, such as a tool falling on a worker
   

6. Repetitive motion injuries
   

7. Highway accidents