ARE YOUR CONTRACTS AND INSURANCE POLICIES PROTECTING YOU FROM COLLABORATION RISK?

Date: May 5th, 2015
Categories: Contracts, Insurance

Construction is a collaborative process. Always has been, always will be. Despite this reality, market forces have historically prevailed in developing construction contracts to compartmentalize the owner’s relationships with the builder and the designer, keeping designer and builder separate from one another despite the need for these entities to work together in order for the project to succeed.

At its most dysfunctional, collaboration in construction occurs in the field, typically between a superintendent and a field engineer doing their level best to resolve an issue that managed to go unaddressed until well after steel had been purchased, formwork built and concrete poured. Despite the most valiant efforts, collaboration at this point often comes too late to efficiently affect any needed changes.

Enter alternative contracting methods. Construction is no different from other businesses in that the market participants figure out the best way to accomplish a goal while lawyers and insurers follow behind wagging a finger at the risk created by going off script, improvising, being an entrepreneur.

This article discusses the oftentimes unallocated risk that’s created by collaboration and the melding of construction and professional services; the technology incentivizing even greater collaboration and blurring of the traditional designer and builder roles; and how you can effectively manage this risk by reassessing your contracts and insurance coverage.

To read the entire article recently published in the Seattle Daily Journal of Commerce, please click here.