The Covid-19 pandemic’s disrupting influence on the construction industry is predicted to have long-term effects on an already high risk industry. Moreover, the unprecedented actions taken to prevent the spread of the pandemic has had a direct impact on contractors, and might be felt for years to come.
The dangers of risk mitigation actions
So, what has been happening that is causing the partial shutdown of the industry across the nation? Here are 2 of the actions that are going to have far reaching consequences:
- Actions by lenders to mitigate financial risk:
Lenders are withdrawing project financial as the viability of many projects has declined significantly.
- Actions by municipalities to mitigate health risks:
In order to limit human contact, local municipalities have shut down projects and closed building sites.
It’s out of your hands, and it doesn’t feel good. So, what can you do to get some control over the survival of your contractor business?
Take back (some) control
You may have heard this advice from some economic experts: don’t do anything until the dust has settled. Furthermore, only once we can assess the true impact of Covid-19 on the industry as a whole and on your business, can you make sound strategic decisions that will move your business forward.
But right now, with your present and future financial state at risk, can you afford to sit tight?
Not many building-related businesses have the luxury to wait-and-see. It makes more sense to be proactive and see what you can do to lessen the impact of the virus on your business.
Coronavirus and Contractors Insurance
Most contractor insurance programs include:
- Contractors Liability coverage to protect your building-related business from third party claims. During Coronavirus, this could include claims brought by visitors to your site claiming health and safety negligence and failure to protect against Covid-19.
- Workers Compensation to protect workers from bodily injury, disability or fatality in the course of their work. Insurance carriers are assessing whether this covers coronavirus.
- Builder’s Risk Insurance to protect the building you are constructing, remodeling or renovating. Furthermore, this coverage is project specific. A well negotiated Builder’s Risk policy could provide much compensation if your building site has received shut down orders from government officials.
Builder’s Risk Coverage
Find out from your insurance agent if your Builder’s Risk Insurance covers the following:
- Direct project expenses and contractor costs
- Site security costs
- Project financing costs
Protect your investment
However, if your Coronavirus and Contractor Insurance claim is going to be taken seriously, you have to come to the party and secure your site. Here is what you should do during the period of shut down and suspended construction activity:
- You can protect the unfinished building against the threat of theft and vandalism.
- Protect building materials by storing according to manufacturer’s recommendations
- You can protect the structure from potential water and wind damage with bracing and covers
- Protect against the threat of fire by removing debris and combustibles
Coronavirus and Contractor Insurance next steps
When it comes to Coronavirus and Contractor Insurance it pays to be proactive. Reassessing your insurance is vital. Find out more from Farmer Brown Insurance. Speak with an experienced consultant by calling (888) 973-0016