Cost Savings is one of the main benefits of implementing a Wrap Up. In order to make more money, companies must be creative and find ways to cut project costs. Typically, you don’t want to cut cost in key areas like hiring quality contractors to perform the work or using quality materials to build the project. So, what better way to save than cutting the cost of insurance?
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Just over 10 years ago, Wrap-Up Administration was managed by using paper forms submitted via fax and enrollments tracked via simple excel spreadsheets. Administrators were manually creating weekly reports, and companies were hiring entry-level personnel or third-party administrators for routine data entry. This left a great margin for error.
A wrap-up is the consolidation of workers’ compensation, excess/umbrella and general liability insurance coverage for all or most of the entities working on a project. Construction companies submitting bids for the jobs are asked to deduct these insurance costs from their bids. The wrap-up administrator then purchases coverage for the job. Once engaged in the project, the contractor’s cost of insurance is deducted from the payments it receives as the project goes forward.
I recently came across a blog post on the website for Cobb Strecker Dunphy and Zimmerman, a commercial insurance and surety company that services the construction industry, among others. The post was titled When Bigger is Just Bigger, and one section in particular struck a chord.
As an advisor to the construction industry providing OCIP software and CCIP software, I always enjoy speaking to risk management executives at owner organizations and contractor sponsors. After all, our software is ultimately designed to provide better service to these firms. It’s great to hear directly from the source what they are looking for in their wrap-up administration service, so we can think about how to incorporate these needs into our product.
As the 30th IRMI Construction Risk Conference came to a close yesterday, we were struck by some key takeaways. As a provider of wrap-up administration technology, we were drawn to sessions about OCIPs and CCIPs, presented by key specialists such as Kathleen Creedon of Wrap Strategies and Richard Resnick of Aon.
