Construction Managers Professional Liability Insurance is for managers that inspect or supervise construction projects. The Scope of Work (SOW) is a section of the agreement that incorporates measurements and developments necessary for delivery of the final product - a prospectus for the expected results. Construction managers are usually independent contractors with significant experience coordinating construction projects. Although general contractors can perform the necessary work in construction, there are professionals that function as construction managers.

Construction Managers Professional Liability Insurance does not cover risks associated with products or materials. Many policies do not include safety concerns although some policies do provide specific professional activities.

The Insurance Services Office (ISO) furnishes endorsements to Commercial General Liability (CGL) policies that address construction exposure. CG 22 34 is an endorsement exclusion for Construction Management Errors and Omissions. As with most insurance policies, provisions and exclusions differ between companies.

Construction managers incur many risks and responsibilities which should be stated in the contract. These risks include many Occupational Health and Safety Administration (OSHA) requirements. Construction managers must make cognizant decisions relating to the project. Special attention to details should include bonding, workers compensation, and liability. Construction managers have increased responsibilities in cost estimating, scheduling and administration. Assumptions must not be made on coverages for professional liability insurance. A disparity in coverage and protection causes a legion of issues.

Pollution coverage can be essential to construction manager’s professional liability insurance. The coverage includes injuries, property damage, and possible clean up. Some policies include pollution, but there are times that this coverage has to be purchased separately.

It is very important to check and verify policy language in the policy being purchased. Each coverage is different. Understanding the inclusions and exclusions are necessary. Equally important is the understanding of how coverages work if claims arise.

Insurance terms differ between carriers. Always scrutinize the policy for clarification. Knowledge of exclusions are helpful when claims arise, but violations of some exclusions can result in insurance fraud. Knowing the policy language and the coverage can prevent errors and omissions.

Contractors Professional Liability (CPrL) insurance or a Rectification/Mitigation (RM) endorsement covers construction managers for claims involving injuries or property damage from construction/destruction work. This endorsement not only covers employees, but it can also cover volunteers working with charitable organizations.

CPPI (Contractors Protective Professional Indemnity Insurance) and OPPI (Owners Professional Protective Indemnity Policy) are policies that can be specifically purchased for construction managers. CPPI policies include excess indemnity and professional liability claims coverage. CPPI policies are available when primary coverage for the claim is unavailable. CPPI and OPPI policies are sometimes difficult to find as limited companies offer this protection.

Typically, the CPPI and OPPI options are offered depending on the liability insurance options. A CPPI policy is generally purchased with a CCIP (contractor-controlled insurance program). A OPPI policy is purchased with a OCIP (owner-controlled insurance program).

There are many risks that construction managers face depending on the projects. It is best to search early for the best protection. Construction managers must research the best options available for specific projects. There are many questions that the IRMI (International Risk Management Institute) can help with. IRMI provides many benefits and risk management analysis tools for construction managers professional liability insurance.

Contact a local insurance professional that has experience with this business category, someone that can guide you and help you procure the right insurance coverage.