As important as blueprints and permits are before breaking ground, a strong risk management plan—specifically in the context of evaluating insurance needs—is an essential pre-build part of any construction project. Taking extra time at the initiation of a project to understand the scope and extent of both coverage and exclusions should be part of counseling a business undertaking a significant construction project.

At the outset, there are various types of insurance policies available to address the type of risks associated with such projects. Sample policies available include commercial general liability (CGL) policies, errors and omissions policies for construction professionals, and owner controlled insurance programs (OCIP) or wrap-up insurance. Additionally, other types of insurance might also be relevant in the construction context, including worker’s compensation coverage and auto insurance. Without adequate insurance coverage, the cost of defending against and resolving claims can be substantial and may negatively impact the financial stability of the parties involved in the project.