CONSTRUCTION AND ERECTION RISKS ASSESSMENT ENGINEERING OUTLOOK

2012

The first object of CAR insurance

2

Lambeth Bridge is the first object of CAR insurance

Would you provide these builders with life insurance?

3

4

How could risks be assessed?

Land subsidence and collapse diagnosis

5

Unfinished fire extinguishing system in the building under construction

6

Combustible materials in the building under construction

7

Stages of construction works

8

Pre-insurance survey

9

Advantages Disadvantages

Making decision before the construction starts

Contractors can be assessed on their previous projects only

Some recommendations can be given before the construction started

All conclusions are made on the base of design examination

Construction stage

10

Advantages Disadvantages

We can assess the performance of contractors at the construction site

Usually the insurance policy is already issued

Some design errors can be revealed at the construction site

Planned and actual way of work performing can be compared

We can define the implementation of recommendations

More recommendations can be elaborated

Start-up and commissioning

11

Advantages Disadvantages

We can define the implementation of recommendations

The final stage of construction, it is to late to recommend something regarding the operations

Some recommendations regarding housekeeping can be given

We have los history for the object

Warranty period

12

Advantages Disadvantages

The majority of problems appear at the initial stages of buildings’ operation

The building (structure) is finished, so we cannot change something in it

Stages of survey

13

• Examination of design• Study of contractors

Before the visit

• Site survey• Documentation examination

During the visit

• Recommendation elaboration• Survey report preparation

After the visit

What do underwriters need to assess the risk?

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• Location map• Over-all contoured side plan – showing contract site,

storage and work areas• Full Contract Value (broken down into major sections of

work) – also include ‘free issue’ or other materials not included in contract value, but for which cover is required

• Detailed description of project works including method of construction, equipment materials etc.

• A copy of the contract specification/feasibility study• Scale drawings, general arrangement drawings and

cross sectional drawings• Construction schedule bar chart• Contractors and Sub-contractors’ experience• Photographs (if available)

15

Survey report content

Survey report contains the following sections:

1. Risk assessment summary

2. Area description – regional features, climatic features, geographical and hydro

geological characteristics of region

3. General data – location, contractors, etc.

4. Construction methods – brief construction methods description, state of means of

production, construction control methods

5. Design parameters of buildings and structures – technical features, construction

materials, current state of buildings and structures

6. Infrastructure – features and state of engineering equipment and communications

7. Loss history

8. Fire protection – technical and managerial procedures aimed at fire prevention and

loss minimization

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Survey report content

9. Security – physical security and engineered safety features

10. Insurance conditions – insured perils, sum insured, significant conditions of

insurance policy

11. Risk assessment – each insured risk is examined separately, its probability and

consequences are estimated. Hazardous occurrence scenarios are elaborated if

necessary

12. Risk improvement recommendations

13. Conclusion and proposals – general conclusions based on the results of

engineering risk assessment, recommendations of insurance coverage

optimization

17

Survey report content

Survey report provided with tables, diagrams and schemes

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Survey report content

Photographs, diagrams and schemes are given to describe manufacturing method and

means of production

Funds application – loss growth

PML Funds application

19

McCormic Place exibition center(before the fire)

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McCormic Place exhibition center(after the fire)

22

Loss estimation

23

Large losses’ causes: EAR, CAR and guarantee

1; Столбец1; 28.50%

2; Столбец1; 18.60%

3; Столбец1; 11.80%

4; Столбец1; 11.10%5; Столбец1;

9.60%6; Столбец1;

9.40%7; Столбец1; 6.20%8; Столбец1;

4.80%

1. Faulty material and workmanship 5. Faulty operation

2. Flood and inundation 6. Storm

3. Others 7. Fire

4. Explosions 8. Faulty design

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St. Francis Dam under construction

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St. Francis Dam before and after collapse

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Inundation of construction site in Dubai

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World Trade Center’s construction site

28

Storm in Sochi Cargo seaport

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Storm in Sochi Cargo seaport

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Fire in Vostok tower of Moscow international business center

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Vladivostok bridge in flames

32

Fire in Transport Tower (Kazakhstan)

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Fire in Transport Tower (Kazakhstan)

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Residential building under construction (China)

35

Connecticut power plant explosion

36

Connecticut power plant explosion

37

Any questions?

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