Charles W. Miller III, Esq. Norris, McLaughlin & Marcus

1. How to Manage Risk and Stay out of Trouble on Capital Investment ProjectsRisk Management and Insurance Charles W. Miller III, Esq. Norris, McLaughlin & Marcus

2. Risk Management “It’s Not Rocket Science…It’s Much More Complicated.”

3. Risk Management Process • Recognition of Risk • Risk Assessment • Developing Strategies to Manage Risk • Mitigation of Risk

4. Risk Management Risk Control – limiting risk exposures. Risk Financing – limiting payment due to risk exposures.

5. Construction-related Insurance • Builders Risk Insurance – Building coverage during the course of construction. • Commercial General Liability (CGL) Insurance – Third-party liability coverage. • Excess/Umbrella Liability Insurance – Broader/higher coverage for excess claims.

6. Construction-related Insurance • Workers Compensation Insurance – Employee injuries at work.

7. Construction-related Insurance • Pollution Insurance – • Excluded in CGL coverage.

8. Construction-related Insurance • Professional Liability Insurance – Design and construction professionals. • Project-Specific Professional Liability • Owner’s Protective Professional Indemnity

9. Construction-related Insurance • Subcontractor Default Insurance/Subguard

10. Construction-related Insurance • Controlled Insurance Plan or “Wrap-up” Insurance – Comprehensive insurance program for all project participants.

11. Certificate of Insurance vs. Additional InsuredCertificate of Insurance does not establish insurance coverage.

12. Statute of Repose vs. Statute of Limitation • Statute of Repose – begins at period following completion of services. • Statute of Limitations – begins at date of injury or discovery.

13. Example

14. Night Watchman Worker’s Compensation

15. Joe Smith - Neighbor • Commercial General Liability • Umbrella

16. Electrical Switchgear • Builders Risk

17. Business Income/Rental Income Loss under Builders Risk Policy Delayed Completion

18. Contaminated Soil • Pollution