We now find ourselves in, what some might consider, a more precarious working environment. This rings true in particular, for construction professionals who were already navigating challenging market conditions.
Taking out of the equation, the already elevated PI rates for these professions, it is worth highlighting some of the new projected concerns and points of interest that 2021 onwards will provide.
As we formally enter a recession and a post-Brexit landscape, below are some key points to consider in terms of claims within the construction sector.
It is proven that there is always an uplift in claims during a recession, or a period of economic uncertainty, due to firms all along the production chain becoming more litigious, in order to rake back some of their financial losses. In particular, delayed projects through site closures and overrun costs.
Here is a reminder of some of the key points that can protect your business when out on site:
- Detailed site notes
- Signed and dated inspection records and notes– Ensure everyone in the team is reminded of best practice- insurers will not honor claims retrospectively if there are no proof of records
- Written chronology of project is key– memories can fade and delegation of tasks can become forgotten
- Are there any current or projected obstacles to delivering your project? – Make notes on productivity and pace of project as overrun costs will be expected. Manage expectations in writing as much as possible.
- Sign and agree a clear written agreement– Qualify your terms of contract appropriately
- Collateral warranties and appointments are reviewed to ensure that it is possible to adhere to reasonable skill and care definition- Brunel offer a free review for all of our clients
- Keep within your scope of agreed services- Comments/sketches and advice on an informal basis can and have been used in claims scenarios. Ensure third party contractors are not able to make a claim upon the basis of an informal recommendation or a ‘he said, she said’ scenario.
- Housekeeping- Your PI policy will likely have a sub-consultants’ warranty which means all BFSC need to have their own cover in place. It’s important to review this annually as part of your housekeeping and audits to ensure PI covers are back to back with each other