Important Factors That Affect Your Risk
Our construction clients are always up to date on the latest in insurance and legal information because it is our job to keep them updated. But when it comes to running a business, we always insist that our clients keep us in the loop whenever anything changes. There are certain types of changes that affect your company’s risk exposure and would require us to make changes to the way you are protected. There are many changes to a company’s business model that can seem routine at first, but can inevitably alter their risk exposure considerably.
Taking On New Technology
Most cities, such as New York City, are requiring contractors to have the latest technology to make jobs safer. Cranes need to be equipped with wind speed gauges to let operators know when conditions have become unsafe, and some newer forklifts come with alarms to warn when a load is off-balance.
Bringing in new technology sounds like it would do nothing but benefit the company, but that is not always the case. An employee who does not know how to use the technology can do more harm than good, and that increases your company’s exposure to risk. Before you implement new technology, you should always get guidance from your risk assessment professionals first.
Our clients always get excited when they take on their first large project because it represents a step closer to their ultimate business goals. But they also forget that larger projects are not just smaller projects on a bigger scale. Larger projects have a tremendous amount of risk, and there are always new dangers to consider when the projects get larger. Before you break ground on your company’s first large project, you should review the entire project with your risk partner first to make sure your company has what it needs to get the job done.
We have some clients that prefer to bring in temporary employees to get certain jobs done instead of hiring subcontractors. There is nothing wrong with this practice, but it brings in a whole new set of risks that you may not be aware of.
A general contractor is responsible for the actions of its subcontractors on any job, but risk mitigation agreements can help deflect financial problems if the subcontractor makes a mistake. But when you use temporary employees, you are responsible for any error. That means that you have to invest in the proper equipment and training for those employees if you want to reduce your chances for risk.
One way smaller construction companies win bigger jobs is to create a temporary company consisting of each separate organization. This is very common, but it comes with great risks. If you do not outline the responsibilities of each partner in great detail, then one of the partners could be headed for financial disaster. Before you sign a temporary agreement with a company to win a larger job, you need to discuss the risks with your insurance partner first.
Risk can go up or down, depending on the situation. Whenever your company’s situation changes in any way, you must get your risk partner involved to make sure that you are always protected from potential financial disaster.