TYPES OF CIVIL ENGINEERING CONSTRUCTION INSURANCE BASIC AND TUTORIALS

CIVIL ENGINEERING CONSTRUCTION INSURANCE TYPES BASIC INFORMATION
What Are The Types Of Civil Engineering Construction Insurance?


Commercial General Liability Insurance
This type of insurance provides coverage for claims by third parties against the CM/GC and all additional named insured parties. A pedestrian who has an accident while passing by a construction site would be covered under this type of insurance policy.


Builders Risk Insurance
This type of insurance provides coverage against the insured’s loss to the property during the construction process. A break in a water service in the building during the construction process, which damages electrical, mechanical, elevator, and plumbing systems would be covered under this type of insurance policy.

It is a primary coverage rather than against a claim from a third party. One needs to define the policy period for which it is in effect, which could be when the project is completed or a date thereafter.

Errors and Omissions Insurance
This is the professional liability insurance for the CM/GC and design professionals. CM/GCs cannot easily obtain architectural or engineering services Errors and Omission (E&O) coverage. The CM/GC must be careful with this type of insurance, especially if involved with a design-build project.


Environmental Liability Insurance 
This is a specialized insurance policy to cover pollution and hazardous material damages such as asbestos, mold, lead paint, medical waste, fuel oil, etc. The coverage under the commercial general liability (CGL) policy is very limited, and a separate policy with broader environmental coverage is often obtained to deal with these matters.

It is recommended that the owner directly hold the contract for environmental work and provide the insurance policy for the appropriate coverage, with the CM/GC as the additional named insured.


Workers’ Compensation Insurance
Workers’ Compensation (WC) coverage is a state mandatory insurance to provide coverage for the CN/GC’s workers if they are injured while performing their work. It provides for lost wages, medical coverage, and loss of partial or full ability to work because of an accident on the job.


Automobile Coverage
This provides coverage for all automobiles and trucks used in connection with the construction of the project, as well as transporting personnel and material to and from the project site. The insurance company will require the names and drivers license information for all drivers operating vehicles covered under the policy.

If a driver’s report from the Department of Motor Vehicles is not good, that person may be excluded from coverage under the policy, and thus should not drive company vehicles.

SIZE AND REVENUE OF CIVIL ENGINEERING CONTRACTORS BASIC AND TUTORIALS

SIZE AND REVENUE OF CIVIL ENGINEERING CONTRACTORS BASIC INFORMATION
What Is The Size And Revenue Of Civil Engineering Contractors?


The construction industry is composed of about 710,000 businesses, mostly small companies, 91 percent of which have fewer than 20 employees. While the largest U.S.-based contractor had revenues of $22 billion in 2007, the overwhelming majority of builders had an annual volume of less than $10 million.

To provide a snapshot of the construction industry, it can be categorized as one in which building contractors range in size from a small family-owned business operating in a narrow geographic area to giant multinational firms.Finding the right one for your project is sometimes a confusing task but can be made somewhat easier by understanding how the industry works.

This is a business of high risk and relatively low profi t margins. The Construction Financial Management Association (CFMA) of Princeton, New Jersey, is a nonprofit organization serving the construction financial community; every year it surveys the 7,000 members in chapters across the country to obtain financial data and the major concerns of the industry.

The members include residential, nonresidential, industrial highway, and specialty contractors. The 2007 financial survey presented the following national overview as reported by the respondents:

■ The year’s hot topic was fi eld personnel recruitment and the ability to retain qualified workers, a concern that will continue for the immediate future. (This can impact owners, who may see a decrease in quality levels of workers.)

■ Construction jobs are good jobs, with the seasonally adjusted hourly rate of $21.08 per hour as of September 2007, a rate that reflects a 4.5 percent increase over the previous year for the same period. (Owners may find that labor increases in the construction industry exceed the overall inflation figures reported in the media.)

■ Material costs are a major problem. From December 2003 to September 2007, construction material producer prices indices increased 30 percent, more than double the 13 percent rise in the Consumer Price Index (CPI). Steel, cement, diesel fuel, and other petroleum-based products were at the top of the price
increase column.

The construction slowdown in 2008 in the United States has had a dampening effect on price increases of some materials, while worldwide demand has increased the prices of others. The projected building cost index for 2009, as reported by McGraw-Hill in December of 2008, refl ected a decrease of 0.5 percent, as opposed to an increase of 5.5 percent for the year 2007 – 2008.

■ In 2006, shipments of construction materials exceeded $500 billion, approximately 11 percent of the total shipments by U.S. manufacturers, and shipments of construction machinery topped $36 billion, 11 percent of all U.S. machinery manufacturers.

Due to the value of the dollar in relation to other world currencies, heavy equipment manufacturers like Caterpillar saw export sales rise during that period.

■ The typical construction establishment is a small company with an average employment of fewer than nine individuals.

■ Internal Revenue Service fi gures for 2004 show that the 700,000 corporations in construction had a net income of $47 billion, or 3.7 percent of total receipts of $1.3 trillion, considerably below the all-industry average margin of 4.9 percent.

■ Construction is a high-turnover industry. The Small Business Administration (SBA) showed that in 2004, 77,000 companies closed shop.

CFMA reviews the member responses and prepares a Best-in-Class composite for nonresidential and industrial building contractors.