It is important to reduce your risk in construction as much as possible to ensure you and your workers have a good work experience and you are able to maximize the time and profitability of your company. This review discusses the biggest risks in construction and how to reduce your company’s risks as much as possible.
What Are the Biggest Risks in Construction?
The specific risks your construction company has may be different from the risks of other companies. However, the most common risks construction companies deal with are related to labor, disputes, safety hazards, and documentation. The following is a closer look at each construction risk.
Labor Shortage
Construction is one of the harder industries to find qualified and capable labor. This has led to an industry-wide labor shortage. While finding applicants may not be much of a challenge, finding applicants that are a good fit for your company is where the difficult part comes in.
In addition, a high rate of employee turnover and a lower quality of craftsmanship due to an inability to find enough skilled workers could increase your company’s risk of litigation and subsequent increased legal costs. Workers taking on more of a load than they should due to a labor shortage or having workers that are not qualified could also increase the risk of a workplace accident and the need to file a worker’s compensation claim.
Dealing With Disputes
Disputes regularly arise in the construction industry. This can be due to communication issues, payment-related concerns, errors and omissions, client issues with the quality of the work, and more. Disputes can lead to lawsuits related to liability and to an expensive litigation process for construction companies.
Safety Hazards
Construction crews should do everything within their power to make their construction sites as safe as possible for every worker. However, the reality is working in the construction industry comes with a risk of injury. Since eliminating all injury-related risks may not be possible, it is important for construction companies to protect themselves and their employees with adequate insurance coverage.
Documentation Management
Documentation of construction processes, client contracts and more is important to mitigate risk. If issues occur with documentation, such as clerical errors or misplacing important documents, then it could leave your business vulnerable to lawsuits, the inability to collect payments and other concerns.
How to Mitigate Your Risk in Construction
The best ways to mitigate your construction risks depend on the specific risks associated with your business and work projects. Subsequently, it is best to talk to a construction insurance professional about the associated risks. However, in general, the most notable ways for construction companies to mitigate risk are to eliminate the root causes of common problems, put a plan in place to deal with issues when they arise and appropriately utilize construction insurance.
Eliminate the Root Cause of Problems Before They Occur
The best way to deal with construction risks is to prevent them from occurring in the first place. While this is, of course, easier said than done, it is possible by determining your company’s biggest risks and taking precautions to mitigate those risks. For example, if you and your employees work on scaffolding at high heights, then ensuring the scaffolding rails are strong and your workers are well-equipped with the proper safety equipment can help reduce the risk of a workplace injury.
Have a Plan in Place to Promptly Deal With the Most Common Issues
By understanding your company’s largest risks, you can implement plans to promptly deal with concerns once they develop. Make sure to educate your workers on the processes to follow if an incident were to occur. For example, if someone were to approach one of you or one of your workers with a dispute, you and your workers should understand the best way to diffuse situations and subsequently reduce the risk of escalating tension and possible lawsuits. Of course, this is just one of many possible examples where proper planning can help mitigate risk in construction.
Take Advantage of a Personalized Construction Insurance Policy
Construction insurance is one of the best ways to reduce your financial risk in construction. An insurance policy can protect you financially if one of your workers are injured while on the job; a third party claims you are liable for property damage, bodily injury, or poor craftsmanship; your construction equipment is damaged or destroyed onsite due to vandalism or a bad storm; and much more. Your construction insurance policy can be tailored to meet your specific needs and the biggest industry concerns.
Speak With the Construction Insurance Pros at John M. Glover
JMG Insurance Corp provides insurance policies for construction companies. This can protect your insurance business financially if unexpected concerns develop, such as lawsuits, workers getting injured on the job and more. If you are searching for a reliable construction insurance policy, contact our professional insurance agents today.