An RMs Book On Construction Risks

By Caroline McDonald

NU Online News Service, July 15, 4:00 p.m. EST?International Risk Management Institute Inc. has issued a new publication detailing how risk managers can avoid pitfalls in design-build construction.

The book, "Design-Build Risk and Insurance," explains a method of construction that "combines the design phase and the construction phase, and puts that under one contract," said Ann Hickman, editor and contributing author for the book.

Design-build, she said, "creates new risks for either the architect or the contractor who is now acting in the role of providing both of those services."

The book, she said, identifies "what new risks the various parties take on under this kind of a contract arrangement and how to properly insure for them." It addresses some of the changes in the owner's risks as well.

Ms. Hickman said that the method, used for years in Europe, is becoming more popular in the United States because it removes some of the worries for owners. "A construction project owner only has to deal with one party," she said.

By contracting a project to one party, "it is up to that person" to hire qualified professionals for the job, she said.

"It's supposed to reduce finger-pointing, and it offers the opportunity to fast-track what normally is a two-phase project," she said, because "design and construction can be running simultaneously, instead of in two phases."

Though costs may or may not be an advantage, "the method has shown a reduction in claims between the parties," Ms. Hickman said. "So there's less fighting during or after the fact."

The book includes nine chapters that cover a variety of topics, including an introduction to design-build claims, coverage for design-build risks in standard policies, architects and engineers E&O insurance, contractors professional liability insurance, project-specific professional liability insurance, and surety in design-build, according to Dallas-based IRMI.

More information about the book is available at www.irmi.com/products, 800-827-4242, or info@irmi.com

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An RMs Book On Construction Risks

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