Construction Liability

Goss LLC A Business-Oriented Insurance Agency

“We are Risk Management Problem Solvers”



In today’s economic and business climate, large construction projects are becoming more difficult to finance because of increasing costs, lack of control, and rising litigation.

Owners and contractors of these projects want innovative solutions to decrease the cost of construction while making the project safer. In recent years, “wrap-up” insurance programs have been used to help achieve both of these goals.

Goss LLC Insurance Agency’s policy provides a coverage solution for contractors who construct commercial buildings, residential projects, including condominiums, town homes, tract homes and single family residences. It protects the construction team against third party pollution claims arising from the performance of covered operations. Mold coverage may also be included.

The Concept
With a wrap-up program, the owner furnishes a single insurance program for all parties involved in the project(s) for duration of the project term. This insurance relates to the exposures of the project and protects the project owner, contractors, and all tiers of subcontractors.

Most wrap-ups include workers’ compensation, general and excess liability, and builder’s risk coverages (auto liability and contractor’s equipment is not included). Wrap-ups can include project architects/engineers errors and omissions coverage and other optional coverages.

Under a wrap-up, the owner experiences a variety of gains:

  • Pays the cost of the insurance on a direct basis, as opposed to paying indirectly through inclusion in the contractor’s bids.
  • Avoids paying the contingency (e.g., inflation and rate increases) and profit loading applied by contractors to their actual insurance costs
  • Eliminates or greatly reduces duplication of premium costs where contractors and each of their subcontractors end up insuring the same cost elements
  • Requests bids with/without insurance costs as a bid line item
  • Benefits by paying only the ultimate net cost of the insurance; all premium discounts, economies of volume purchasing, and dividends for good experience flow directly to the owner.

In addition to the cost savings, the owner experiences a number of benefits:

  • A single, coordinated loss control and claims handling program makes for a safer job site, which also results in a project completed on time and under budget
  • Broader coverage that meets prescribed standards and provides uniform insurance protection; higher limits can be purchased due to a larger volume of insurance
  • The assurance that all parties to the project are insured, instead of reliance on a multitude of certificates of insurance that do not guarantee coverage
  • Extended completed operations coverage on the entire project(s)

Wrap-Up Advantages
The strongest factor in favor of a wrap-up is the potential for significant savings in the overall cost of the project(s). The use of wrap-ups can provide substantial savings through dividends or return premium payable to the owner. These are granted based on favorable project loss experience and consolidated premium volume generated under the wrap-up. Additional savings through cash flow management can also be achieved. It is not unusual for a Goss LLC executed wrap-up to save the owner more than 1 percent to 2 percent (or more) of the project’s hard construction costs.

Large construction or infrastructure projects, typically in excess of $100 million, are more and more frequently insured under a Controlled Insurance Program (“CIP”), colloquially referred to as a “wrap up” program. Under a CIP, one of the participants in the project controls the procurement of insurance for all or the majority of the construction participants. If the controlling entity is the project owner, the coverage is referred to as an owner-controlled insurance program or “OCIP.” If the controlling entity is the general contractor, the coverage is referred to as a contractor-controlled insurance program or “CCIP.” (The project could be insured in a hybrid manner or “Co-CIP”.)


  • Design-build contractors
  • General contractors
  • Construction managers
  • Design professionals
  • Project owners and developers


  • Residential and habitation construction projects
  • Steel and concrete condominium towers
  • Commercial construction
  • Interior build-outs
  • Conversions
  • Mixed use


  • Multi-year policies available
  • Covers claims for bodily injury and property damage, including clean-up costs
  • Policy is written on a claims-made basis and can include up to a 10 year extended reporting period
  • Policy term up to five years of construction
  • Contractual liability coverage when required
  • Option for occurrence form coverage may be available for some types of projects
  • Can cover both on and off-site clean-up costs
  • Defense costs are within the limits of liability
  • Covers both sudden and gradual pollution events
  • Nationwide coverage available
  • Coverage for natural resources damage
  • Broad form named insured available

We realize that risk management is a critical element to a successful business strategy. Therefore, we help our policyholders manage risk by providing complimentary informed guidance and value-added services, including:

  • Quick turn-around contract reviews
  • Environmental Briefings newsletters and publications
  • Risk management workshops, presentations and guidance
  • Pre-claims assistance

Wrap-up – The generic name for an insurance program that is characterized by the centralized purchase of insurance to protect most entities while performing work at a large construction project.

CIP – A consolidated insurance program; also a more formal name for a wrap-up insurance program.

OCIP – An owner controlled insurance program or a consolidated insurance program in which owner of the project is the sponsor of the CIP.

CCIP – A contractor controlled insurance program or a consolidated insurance program in which the general contractor (or construction manager) for the project is the sponsor of the CIP.

Sponsor – The entity that acts as the centralized purchasing entity and also arranges the CIP.

Administrator – The entity to which the sponsor delegates the administration of the CIP – often the insurance broker that also places the coverage for the CIP.

Off-Site Liability Coverage – As the CIP provides liability coverage only at the project site, the CIP sponsor customarily requires evidence of liability insurance for any bodily injury or property damage that may take place away from the project site. Operations such as assembly, fabrication, project meetings, etc. related to the project are examples of off-site exposures to be covered by the enrolled party’s own liability coverage.

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