The discussion focused on the comparative benefits of Owner Controlled Insurance Programs (OCIP), Contractor Controlled Insurance Programs (CCIP), and traditional insurance models in construction.
Key topics included program design, cost implications, administrative requirements, and risk management features for each insurance type.
General advantages and challenges of each model were covered without specific action items or formal decisions taken.
Action Items
None.
Overview of OCIP vs CCIP vs Traditional Insurance
OCIP (Owner Controlled Insurance Program)
OCIP is purchased and managed by the project owner and covers all contractors and subcontractors on a project.
Provides consolidated coverage, potentially leading to lower overall insurance costs and fewer gaps or overlaps in coverage.
Streamlines claims handling and administration, offering more uniform risk management.
Challenges can include complex administration and required expertise from the owner’s side.
CCIP (Contractor Controlled Insurance Program)
CCIP is arranged and managed by the general contractor, covering subcontractors as part of a single project-specific policy.
Offers coverage and program control similar to OCIP, but places responsibility and administrative burden on the contractor.
Can enhance coordination and safety among project participants.
May be better suited to contractors with experience managing insurance programs.
Traditional Insurance Programs
In traditional models, each contractor and subcontractor procures their own insurance for the project.
Often results in fragmented coverage, possible gaps or overlaps, and more complex claims processes.
Administrative overhead can be higher due to managing multiple policies.
Can be simpler to implement for smaller projects but may not provide cost savings or consolidated risk management.
Comparative Cost and Risk Considerations
Wrap-up programs (OCIP/CCIP) are often chosen for large projects as they can lower total insurance costs and improve overall risk management.
Financial feasibility studies may be required to determine the best fit for project needs and budget.
Administrative and Compliance Aspects
OCIP and CCIP can reduce the need to track multiple certificates of insurance, but still require diligent compliance management.
Both wrap-up programs and traditional insurance require attention to coverage adequacy, deductibles, and claims protocols.