Contractual Risk Transfer in Construction

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This course provides a general overview of contractual risk transfer in construction contracts and subcontracts, with specific attention to those provisions that present risk and insurance implications for contractors. It reviews the structure of construction contracting relationships and the key provisions in which responsibilities and liabilities are allocated to the contracting parties, and suggests methods to equitably allocate these liabilities. It also examines processes for ensuring the effectiveness of contractual risk transfers, and identifies problems that may arise if contracts are not properly reviewed and their risks managed. The educational objectives of this course include an understanding of the following.

1. The key construction contract provisions that present risk management and insurance challenges for contractors.
2. Commonly used contract risk allocation strategies.
3. The scope of allowable indemnification in construction contracts.
4. Typical contract insurance requirements, challenges contractors have in complying with these requirements, and strategies for negotiating changes.
5. Coverage for contractually assumed liabilities in standard insurance policies.
6. The scope of coverage for additional insureds under various editions of the standard CGL additional insured endorsements.
7. The importance of waivers of subrogation on various insurance policies.
8. The purpose and scope of owners and contractors protective liability and railroad protective liability insurance policies.
9. The value of certificates of insurance as a risk management tool.